Re: [EVDL] Hymotion & A123
Re: [EVDL] Hymotion & A123
>From what I've seen of A123, they are a typical, if innovative,
startup company that has gone into round 4 (or so) of investment. What
this means is they will probably acquire 'like' assets with their
excess capital, their profits will go mostly into increasing share
value and expanding the business, and they will charge absolutely as
much as they can get away with for their product. It's how the game
works for all innovative startups... get the gold before devaluation
due to competition and alternatives pop up in the marketplace. Or buy
up as many alternatives as you can so you can control the price and
the market.
The Hymotion purchase is likely a decision made because they want to
create a submarket where they showcase their technology as being
superior, thus giving them value add. The Plug-In folks are gaining
traction in the business world, and are seeming more legitimate so
this is a decision I applaud. They will be able to control a good part
of the PHEV conversion market through Hymotion, and will be able to
get A123 stickers all over everything involved. Once GM and other
companies (seriously) decide to produce PHEVs, they will certainly
first go to the company that is affiliated with their boardroom
contacts at Chevron, so this makes a lot of sense. I would guess this
has already been discussed over cigars, somewhere.
The next step is doing enough market research to understand where
their PH module pricing models have to be in order to maximize the
value add yet not scare people off with the high price. I doubt we'll
see decreases in price from A123 until several more years have gone
by, or if competition heats up enough so they have no choice BUT to
lower prices.
The huge white elephant in the room that everybody knows but isn't
saying is that once you get 40+ mile range PHEVs out there, the
gasoline consumption in this country will drop like a stone, year
after year as more people buy them and junk their old gas cars, which
will also sink in value. The replacement parts business will suffer
serious losses as well, with everything from brakes to exhaust systems
going by the wayside since they will be lasting 5 times longer, even
if they are made more cheaply. Why? Because the average American
drives 29 miles per day and so huge numbers of people will not be
filling up except maybe once every couple of months.
Hence.... Corbasys' investment/partnership in A123. It's a chess move
to engage stop loss on oil revenue dropping in the hopes that they
will be able to control some significant slice of the battery pie,
which projections show can equal the profits of oil revenue if the
prices were controlled by a pseudo cartel, just as oil prices are. Of
course, batteries are not as vertical as oil, and not as easily
controlled. Plus there is some serious consternation that the biggest
lithium reserves are in South America, in countries that the oil
cartels cannot control. Also batteries can be made from a lot of
different materials, which are all used on things -other- than
batteries. All very messy for a mindset that is focussed on
oligarchical business.
...anyhoo...
All of this seems to mean that A123 may or may not
continue on an independent path, and that they won't provide price
relief unless forced by the marketplace. I would not be surprised at
all to find out in 3 years that Chevron/Corbasys has bought A123 for
some obscene amount of cash.
--T
_______________________________________________
For subscription options, see
http://lists.sjsu.edu/mailman/listinfo/ev
>From what I've seen of A123, they are a typical, if innovative,
startup company that has gone into round 4 (or so) of investment. What
this means is they will probably acquire 'like' assets with their
excess capital, their profits will go mostly into increasing share
value and expanding the business, and they will charge absolutely as
much as they can get away with for their product. It's how the game
works for all innovative startups... get the gold before devaluation
due to competition and alternatives pop up in the marketplace. Or buy
up as many alternatives as you can so you can control the price and
the market.
The Hymotion purchase is likely a decision made because they want to
create a submarket where they showcase their technology as being
superior, thus giving them value add. The Plug-In folks are gaining
traction in the business world, and are seeming more legitimate so
this is a decision I applaud. They will be able to control a good part
of the PHEV conversion market through Hymotion, and will be able to
get A123 stickers all over everything involved. Once GM and other
companies (seriously) decide to produce PHEVs, they will certainly
first go to the company that is affiliated with their boardroom
contacts at Chevron, so this makes a lot of sense. I would guess this
has already been discussed over cigars, somewhere.
The next step is doing enough market research to understand where
their PH module pricing models have to be in order to maximize the
value add yet not scare people off with the high price. I doubt we'll
see decreases in price from A123 until several more years have gone
by, or if competition heats up enough so they have no choice BUT to
lower prices.
The huge white elephant in the room that everybody knows but isn't
saying is that once you get 40+ mile range PHEVs out there, the
gasoline consumption in this country will drop like a stone, year
after year as more people buy them and junk their old gas cars, which
will also sink in value. The replacement parts business will suffer
serious losses as well, with everything from brakes to exhaust systems
going by the wayside since they will be lasting 5 times longer, even
if they are made more cheaply. Why? Because the average American
drives 29 miles per day and so huge numbers of people will not be
filling up except maybe once every couple of months.
Hence.... Corbasys' investment/partnership in A123. It's a chess move
to engage stop loss on oil revenue dropping in the hopes that they
will be able to control some significant slice of the battery pie,
which projections show can equal the profits of oil revenue if the
prices were controlled by a pseudo cartel, just as oil prices are. Of
course, batteries are not as vertical as oil, and not as easily
controlled. Plus there is some serious consternation that the biggest
lithium reserves are in South America, in countries that the oil
cartels cannot control. Also batteries can be made from a lot of
different materials, which are all used on things -other- than
batteries. All very messy for a mindset that is focussed on
oligarchical business.
...anyhoo...
All of this seems to mean that A123 may or may notcontinue on an independent path, and that they won't provide price
relief unless forced by the marketplace. I would not be surprised at
all to find out in 3 years that Chevron/Corbasys has bought A123 for
some obscene amount of cash.
--T
_______________________________________________
For subscription options, see
http://lists.sjsu.edu/mailman/listinfo/ev
