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Posted on Thu, Feb 7, 2013 : 5:58 a.m.

Ex-A123 Systems office in Ann Arbor set to double in size

By Ben Freed

In January, Chicago-based Navitas Systems purchased A123 Systems' research and development center at at 3850 Research Park Drive in Ann Arbor for $2.2 million, and immediately made plans to invest.

Les Alexander, formerly chief operating officer of A123 Systems and now general manager of the new “Navitas Advanced Solutions Group,” said the center, currently 22,000 square feet housing 40 employees, will likely double in both size and staffing within the next year.


General Manager Les Alexander said part of Navitas' expansion in Ann Arbor will hopefully include an upgrade to manufacturing capabilities.

AP Photo/Paul Sancya

“We’ll be looking at hiring on both the engineering side, and the science and chemistry side,” he said. “So chemical engineers, material scientists, and all of the engineering disciplines, mechanical, electrical and others.”

Most of A123 Systems’ assets were sold to Chinese-owned Wanxiang through bankruptcy proceedings. However, the Ann Arbor facility had done most of A123’s government work, including developing technologies for new battery packs to be used by United States soldiers. The sensitive nature of the research made it unlikely that the office would be included in a deal to a foreign investor.

Alexander said the office is in the process of transferring the government contracts to Navitas and will continue to work on them.

Navitas Systems vice president Tom Golab said the newly acquired engineering and chemistry capabilities will complement the company’s current abilities.

“Our experience has been in the packaging side of energy solutions delivery. We were cell agnostic meaning that we could use any cells and we would do the assembly work to package them in a way that our customer could use it,” he said.

“The area we felt we were missing, and that our customers were interested in, was in the research and development side. This was a tremendous opportunity for us to partner with Les [Alexander] and his team.”

Alexander said the new ownership will allow the former A123 office to branch out into more commercial and industrial work in addition to its government contracts.

“We are going to cross pollinate our focus on delivery with Les’ group’s focus on research,” Golab said.

“This will offer the Ann Arbor office an opportunity to deliver a broader array of services to their existing customers. Instead of being able to deliver prototypes, they will now be able to deliver fully functional battery systems.”

Alexander said it has not been determined whether Navitas will expand their existing offices located off of South State Street or look for a new location. He stressed that they are not considering leaving the Ann Arbor area.

“We are exploring all of our options, we want to have room for continued growth,” he said.

“Our ultimate goal is to have manufacturing capability. We want to build the team and the space with the ultimate focus to go to low- to mid-volume applications and add manufacturing.”

Golab said in an email that Navitas has not contacted Ann Arbor SPARK or the Michigan Economic Development Corp. about potential growth incentives but that it is part of the expansion plan.

Almost 20 engineers at the office have been working on lithium ion battery technology in Ann Arbor since Maria and Levi Thompson were running University of Michigan spinoff T/J Technologies. A123 Systems acquired the company in 2006.

Ben Freed covers business for You can sign up here to receive Business Review updates every week. Reach out to Ben at 734-623-2528 or email him at Follow him on twitter @BFreedinA2


Great Lakes Lady

Fri, Feb 8, 2013 : 1:43 p.m.

Ben: A123 is not the first company to take federal money (our tax money)...after making a substantial campaign contribution.... and in a short period of time go bankrupt, e.g. Solyndra. earning the founders extremely high rates of return on their "investments".

Great Lakes Lady

Thu, Feb 7, 2013 : 10:32 p.m.

You miss the point. They took $249 million of our tax money, then declared bankruptcy. Now they re-surface under a different name looking for more tax money....unethical yes,.....illegal, no. No one seems to care about ethics.

Ben Freed

Fri, Feb 8, 2013 : 3:06 a.m.

Great lakes, With all due respect, you're comparing apples to oranges. First, the office is indeed staying open under a different name but that is because it was bought by another legitimate company. It is not simply re-naming itself and emerging from bankruptcy as the same entity. This office was one small part of A123 Systems and before that was T/J Technologies, a rather successful enterprise. As for the government money, the $249 million was a federal government grant. In that case it was indeed easy to say that the company was "taking tax money." Their future applications for tax incentives will likely be to get tax breaks from city, county, and state taxes that will allow for increased investment and expansion in the area. These abatements generally only last for a period of 5-12 years and then the company resumes paying full taxes on the property and/or employees they have in the area. You can still disagree with the moves by the company, but it helps to come from a base understanding. Ben

David Cahill

Thu, Feb 7, 2013 : 4:54 p.m.

Good news for our local economy! The big stumbling block to a host of technological improvements is the battery. Maybe this company will make the breakthrough.

Ben Freed

Thu, Feb 7, 2013 : 5:01 p.m.

Dave, you're absolutely right. I've been told by a number of people in the auto industry that the incremental shrinking of batteries can only take us so far. There needs to be a major breakthrough.

Great Lakes Lady

Thu, Feb 7, 2013 : 2:39 p.m.

A123 Systems, received $249 million of our tax money, then went bankrupt. "....developing technologies for new battery packs to be used by United States soldiers." These assets were sold to a Chinese company??! Now, they've "re-invented" themselves under a new name...and they plan to ask for incentives from AA Spark and Mich Econ Dev. Corp?!? How much will they receive from the federal gov't?? It's very lucrative to make large contributions to the Obama campaign. Solyndra received $535 million of our hard earned tax payer money. Result: bankruptcy. I would say Solyndra and A123 Systems earned an extremely high rate of return on their investment. Investigative journalists need to dig deeper.


Sun, Mar 17, 2013 : 8:33 p.m.

A123 was awarded a 249 million dollar grant as you stated, but what you fail to state is that they spent approximately 130 million of that grant. That grant was to purchase manufacturing equipment only and the equipment had to stay in United States. It was to create jobs here and it did. Also, A123 had to spend money to get that money. For every dollar A123 spent on manufacturing equipment, they received 50 cents back. It only went for manufacturing. I am in no way defending A123 as I quit the company in 2012. They dug themselves in to their hole by pushing product out the door that wasn't ready for mass production. I just wanted you to have your facts straight.

Ben Freed

Thu, Feb 7, 2013 : 5:04 p.m.

Great Lakes, As mentioned in the article the technologies used for military and government application were not sold to the Chinese company, that is why Veritas was part of the bankruptcy deal. The company plans to ask for incentives as part of their expansion plans, most likely IFT abatements and possibly hiring incentives, which extremely normal for all companies in the Ann Arbor area. Ben


Thu, Feb 7, 2013 : 2:57 p.m.

really, you expect M Live to dig deeper? This is a surface only blog.

Lizzy Alfs

Thu, Feb 7, 2013 : 2:21 p.m.

"We'll be looking at hiring on both the engineering side, and the science and chemistry side," he said. "So chemical engineers, material scientists, and all of the engineering disciplines, mechanical, electrical and others." This is interesting. With all the talk about job openings and companies struggling to find the right talent, I wonder if they will be able to hire locally. A lot of companies take trips to California and other places to fill job openings in Ann Arbor.