Frost & Sullivan Applauds A123 Systems’ Strategic Shift in Operations to Solidify its Lithium-Ion Portfolio

A123 Systems has modified its focus on the lithium-ion battery market to tap the potentially high-growth sectors of automotive and mass transportation

January 7, 2015  09:00 AM Eastern Standard Time

Mountain View, Calif. — Based on its recent analysis of lithium-ion batteries for the transportation market, Frost & Sullivan recognizes A123 Systems with the 2014 Global Frost & Sullivan Award for Competitive Strategy Innovation & Leadership. Combining advanced lithium-ion technology, strategic acquisitions and a strong understanding of its customers’ needs, A123 Systems is poised for future growth in the transportation sector.

While A123 Systems has historically offered solutions across transportation, energy storage, and industrial segments, it recently sold off its lithium-ion battery integration operations for the energy storage sector to NEC. Although it will remain a supplier of lithium cells to NEC, this change in focus to end-user application will enhance its position in the engineering and manufacturing of lithium-ion batteries. At the same time, this move will help the company target the high-growth automotive market, specifically the micro-hybrid segment where it already has three customers in series production. A123 Systems is also expanding its presence in the mass transit market, another fertile segment in transportation.

Demonstrating its dedication to entrenching itself in the market, the company acquired rights to Leyden Energy’s high-power technology and related technical staff. As Leyden Energy specialized in developing lithium titanate batteries that utilize non-flammable electrolyte material, A123 Systems is able to address a key product safety challenge associated with lithium-ion batteries.

Given the demanding nature of the transportation segment, Frost & Sullivan appreciates A123 Systems’ continuous investment in R&D to improve lithium-ion battery capability. The company recently launched its Nanophosphate® EXT lithium product that offers substantial power capability at low temperatures, while delivering longer life at higher temperatures. This not only reduces the need for thermal management, but also cuts the associated vehicle costs in some applications.

“By extending the life cycle of its lithium product while simultaneously adding reliability and safety, A123 Systems has effectively established itself as a lithium-ion technology innovator,” said Frost & Sullivan Research Analyst, Imran Khan. “Specifically, within the automotive segment, A123 Systems’ lithium batteries offer more power density, thereby helping micro-hybrid vehicle manufacturers comply with regulations aimed at boosting vehicle fuel efficiency.”

A123 Systems has out-strategized its rivals by maintaining focus on the automotive and mass-transit segments, which are less subject to pricing pressures than the consumer market segments. Similarly, A123 Systems’ affiliation as a member of the Wanxiang Group provides it with a solid manufacturing base in China, which is a promising market for lithium-ion batteries across a range of applications, including transportation.

“A123 Systems works closely with its automotive OEM customers across the globe to develop solutions that address their concerns regarding battery capability and safety,” noted Kahn. “Its decision to align resources with its core strengths, and across high-growth markets, showcases its holistic marketing strategy to meet internal and external stakeholders’ objectives.”

With its strong overall product, R&D, and marketing focus on the transportation segment, A123 Systems has rightly earned the 2014 Global Frost & Sullivan Award for Competitive Strategy Innovation & Leadership.

Each year, Frost & Sullivan presents this award to the company that has leveraged competitive intelligence to successfully execute a competitive strategy that results in stronger market share, competitive brand positioning and customer satisfaction.

Frost & Sullivan’s Best Practices Awards recognize companies in a variety of regional and global markets for outstanding achievement in areas such as leadership, technological innovation, customer service, and product development. Industry analysts compare market participants and measure performance through in-depth interviews, analysis, and extensive secondary research.

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today's market participants.

Our “Growth Partnership” supports clients by addressing these opportunities and incorporating two key elements driving visionary innovation: The Integrated Value Proposition and The Partnership Infrastructure.

• The Integrated Value Proposition provides support to our clients throughout all phases of their journey to visionary innovation including: research, analysis, strategy, vision, innovation and implementation.
 
• The Partnership Infrastructure is entirely unique as it constructs the foundation upon which visionary innovation becomes possible. This includes our 360 degree research, comprehensive industry coverage, career best practices as well as our global footprint of more than 40 offices.

For more than 50 years, we have been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community. Is your organization prepared for the next profound wave of industry convergence, disruptive technologies, increasing competitive intensity, Mega Trends, breakthrough best practices, changing customer dynamics and emerging economies?

Contact:

Mireya Espinoza
P: 210. 247.3870
F: 210.348.1003
E: mireya.espinoza@frost.com