Plan for battery plant zapped by funding loss: Quallion sees delays for new facility in Palmdale.(CONSTRUCTION)(Brief article)

THE future of a planned $220 million battery manufacturing plant in Palmdale has been thrown into doubt after the federal government last week rejected funding for the project.

Quallion LLC, a high-tech battery maker owned by billionaire Alfred Mann, had hoped to receive $100 million to $200 million for the project from the U.S. Department of Energy.

However, the Sylmar company announced that its application for the department's Electric Drive Vehicle Battery and Component Manufacturing Initiative had not been accepted.

Company President Paul Beach told the Business Journal last month that the company would continue efforts to build the plant regardless of whether or not it received funding. But he added construction could be delayed without it.

"We are disappointed by the decision and are waiting to hear the reasoning from the Department of Energy." Beach said in a company statement issued after the decision. "We are evaluating our options and hope to move forward with the new facility in the near future."

The company has spent the past several months securing $20 million in funding and commitments from other sources, but it was contingent on receiving the federal grant.

Quallion makes lithium ion batteries, the preferred technology for energy-intensive applications such as electric and hybrid cars and trucks. Most production of such batteries is now in Asia.

The plant was expected to create 400 construction jobs plus 400 to 2,000 permanent jobs.

Staff Reporter Francisco Vara-Orta can be reached at (323) 549-5225, ext. 241, or at fvara-orta@labusinesjournal.com

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