Battery Industry: Does it pay to invest in batteries? Message Board

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Gold/Mining/Energy : Battery Industry: Does it pay to invest in batteries?

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To: Jacob Snyder who wrote (8)	1/15/2009 12:09:37 PM
From: Sam Citron	Read Replies (1) of 18

A123's recent defeat to LG shows what small US operators like Boston Power are up against. I expect that no matter how good their technology might be, US firms will have great difficulty making inroads against their big Japanese and Korean rivals. What US firms are going to be able to compete against firms like LG, Panasonic, Samsung, Toyota and Honda when it comes to battery production? The Asians understand forward pricing and long-term thinking and their governments understand industrial policy to support manufacturing and exports. As a result of the credit crisis and the collapse of cowboy capitalism, US will spend the next decade trying to figure out what Europe and Asia already know about socialism, private-public partnerships, etc. Venture capital will have a hard time funding advanced research and Asian sovereign wealth funds will begin to shift their investments from US treasury bonds to domestic infrastructure and technology. A123 filed an initial prospectus to come public this past summer, but will need to show potential investors a plausible case for hockey-stick sales and earnings projections to do so. Now that they have lost the Volt deal, it will be interesting to see what they do. They are way too dependent on sales of battery packs to B&D hand-tools and desperately need a strong automobile motive power hook-up. They have arguably the best US technology in this space and if they can't make a go of it, you have to wonder: who can? Project Better Place appears to have a good LT strategy in place, so it is worthwhile watching NEC/Nissan alliance on batteries and see how the battery swapping infrastructure rolls out in places like Israel and Denmark. Otherwise, maybe we we will drive "slot cars" around on big electrified tracks as some of us did in our youth. <g> Sam

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