Battery maker A123 headed toward bankruptcy

Electric car battery maker A123 Systems says it is missing bond payments and could be headed for bankruptcy.

NEW YORK (CNNMoney) -- Electric car battery maker A123 Systems expects to be in default on debt payments Tuesday and could be headed for bankruptcy, according to a document the company has filed with the Securities and Exchange Commission.

"No assurance can be given that the company will be able to avoid restructuring, reorganization or a bankruptcy filing," said A123, in the document, filed Monday.

A123 Systems said that it expected to miss its October interest payment on $143,750,000 worth of 2016 corporate notes. The company said it also expected to miss a payment on another $2,759,000 worth of notes.

The company said it may not have sufficient cash to fund operations, and could seek protection under the U.S. Bankruptcy Code in order to obtain new financing and complete deals it is considering.

A123, based in Waltham, Mass., manufactures lithium ion batteries in Asia, Europe and North America, including batteries for plug-in hybrid and electric cars.

The company's SEC filing comes just two months after Chinese auto parts maker Wanxiang Group Corporation announced plans to invest up to $465 million in A123, including an initial credit extension of $25 million.

In 2009, A123 received $249 million in federal funding for advanced battery technology manufacturing in two sites in Michigan -- Romulus and Brownstown -- as part of a $2.4 billion stimulus package.

First Published: October 16, 2012: 7:13 AM ET

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