General Motors has announced it will work directly with A123 Systems, a start-up based in Watertown, MA, to develop batteries that are fine-tuned for the Chevrolet Volt, an electric vehicle scheduled for production in 2010 or 2011. The new agreement between the companies is designed to speed the vehicle to market.

The co-development deal is the latest in a series of announcements by the automaker indicating it is moving forward with plans for the Volt, an extremely fuel efficient hybrid. The Volt, first announced in January, will use batteries that can be recharged from a standard electrical outlet and is expected to get 40 miles on a single charge, eliminating trips to the gas station for average daily driving. While GM has not ruled out using batteries from another supplier, the agreement is a vote of confidence that A123's technology can meet the requirements for the vehicle, says Denise Gray, GM's director of hybrid energy storage devices.

A123 uses a new lithium-ion chemistry that allows its batteries to be much lighter and more compact than the nickel metal hydride batteries in existing hybrids today, and safer than the conventional lithium ion batteries found in consumer electronics. In June GM announced that it is working with the South Korean company LG Chem, and its subsidiary Compact Power, based in Troy, MI, to make both battery packs and the individual cells inside them. They also signed an agreement with an LG Chem competitor, the Frankfurt, Germany-based Continental Automotive Systems, to develop battery packs. Continental had planned to use A123 as a subcontractor to supply the batteries for these packs. The new agreement puts A123 in direct contact with GM on the Volt project.

At the end of 2005, A123 announced its first product, a cylindrical battery for power tools. For the Volt, A123 is shifting to a much bigger and flat, rather than cylindrical, battery cell that takes up significantly less space. Hundreds of these would be combined in a large pack, with control electronics and a cooling system, to power the Volt.

A123 employees have begun testing the new cell. In one test, a prototype cell, a silvery slab about the size of three decks of cards placed side by side, was crushed from the side to demonstrate its abuse tolerance. Unlike conventional lithium-ion batteries, which use a cobalt-oxide material that can overheat and cause laptops and cell phones to burst into flame, A123's batteries use a much more stable, and potentially cheaper, iron phosphate material. The crushed test battery showed no signs of overheating.

Earlier this year GM had picked A123 Systems as a potential supplier of lithium-ion batteries for a new version of its Saturn Vue hybrid that can be recharged by plugging it in, giving it a 10 mile all-electric range. It could be on the roads as early as 2009.