Apple Inc. (AAPL) Discussing Settlement With A123 Systems
Apple Inc. (NASDAQ:AAPL) is reportedly discussing a settlement with lithium-ion battery maker A123 Systems. Last month, A123 accused Apple of poaching its battery engineers. Apple has asked the federal court in Massachusetts to allow it more time to respond to the accusations because it is considering a resolution.
There have been rumors that Apple Inc. (NASDAQ:AAPL) could start manufacturing electric cars. Apple is said to have assembled a team of automotive experts to push forward its electric car project. The experts in Apple’s car project team have been drawn from automakers such as Ford Motor Company (NYSE:F) and Mercedes-Benz.
A123 Systems claimed that Apple Inc. (NASDAQ:AAPL) was hiring away some of its employees that had been mandated to lead some critical projects in the company. As Apple prepares to enter the electric car business, there have been reports about the company seeking to build a battery division.
This week, Apple told the court that it was exploring a resolution and would need more time to respond to the lawsuit brought against it by A123 Systems. However, both Apple and A123 Systems have preferred not to comment on the matter of potential resolution of the dispute.
Apple has not publicly confirmed or denied speculations that it wants to enter the car business as a manufacturer. However, major automotive players, such as BMW, have already warned that it won’t be business as usual for traditional carmakers with the entry of new players such as Apple.
A123 Systems received $249 million in government backing. The battery company filed for bankruptcy in 2012 and has been offloading some of its assets as part of restructuring efforts. The company specializes in large batteries for industries.
While huge investment has often been cited as one of the major barriers to entry in the car business, Apple Inc. (NASDAQ:AAPL) has enough resources to back its car investment. The company has nearly $180 billion in the bank. However, Apple’s entry into the electric car business could come as a huge challenge for Tesla Motors Inc (NASDAQ:TSLA), an electric carmaker that is struggling to make a profit. Tesla also uses lithium-ion batteries to power its cars, and is building its own battery facility, known as Gigafactory, for $5 billion in Nevada.
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