Cobasys' Owners Want to Sell. Is GM Buying?
The relationship between battery maker Cobasys and parent companies Chevron and Energy Conversion Devices (ECD) is entering the crisis stage. Previously, we reported that Cobasys had no budget or business plan for 2008. They still don't. Chevron cut off funding in September 2007. Oakland Business Review (via mlive.com) reports "the company has been operating on a loan and price increases from an undisclosed customer since February." In February, Cobasys' corporate parents "entered into an interim settlement agreement to negotiate a sale with an unnamed bidder;" they've extended the deadline for completing the sale seven times since then. GM's rumored to be their benefactor and mystery buyer, since Cobasys has the contract to develop and test lithium-ion battery systems for GM's plug-in hybrid electric vehicle program. Given GM's current financial situation, buying into a dysfunctional battery maker seems like a particularly dodgy deal. Which probably means it's exactly what they'll do. [Hat tip to Dan Segal for the link]
More by Frank Williams
Comments
Join the conversation
Manufacturing Capacity for Hybrids and EVs is the new strategic high ground in auto making. Toyota and to a lesser extend Honda have already planted their flag. This could be GMs attempt at getting a piece. I know nothing about their batterie tech, but from what I've seen & heard the thin-film solar modules from ECD are none too hot.
The last thing GM needs to do is to try and salvage one of the failures in the battery wars. There are a lot of companies large and small competing to provide the next generation of batteries and GM doesn't have a good track record in picking winners or in managing acquired companies. Back in the early Sloan days GM was very successful at buying and integrating key suppliers, but not today.