A123 said it expects to continue operations as it moves toward the sale to Johnson Controls. The company said it is in talks to sell its grid, commercial, government and other operations that weren’t purchased by Johnson Controls.
The company was to supply batteries for the new all-electric Chevrolet Spark subcompact from General Motors Co. It also has a contract with BMW AG.
A123 has struggled for several years, and ran into serious trouble this spring after a costly recall of its batteries. Bragman said it wasn’t able to recover from the expense.
The company warned that it might not be able to stay in business unless it got more financing, and just two months ago, it announced a $450 million lifeline from Chinese auto parts maker Wanxiang Group Corp. But A123 said Tuesday that the deal has been scrapped.
A123 subsidiaries outside the U.S. were not included in the bankruptcy filing.