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GM set to buy hybrid battery supplier

by Drew Johnson

After a battery recall that cost General Motors at least 9,000 units of its mild hybrid vehicles, the auto giant is nearing a deal to purchase its battery supplier -- Detroit's Cobasys LLC. The move would safeguard GM's battery supply until 2010 and would also help to prevent any future recalls.

Cobasys is currently owned by Chevron Corp. and Energy Conversion Devices Inc., but neither company can agree who is responsible for the battery supplier -- a situation that is ultimately slowing the selling process.

GM has hired BBK Limited to conduct a final analysis on Cobasys and recommend acquisition strategies. According to Automotive News, GM could set up a partnership with Cobasys, but GM would be the 100 percent owner.

GM has a vested interest in Cobasys as its closure would force the automaker to find a new supplier of batteries for its mild hybrid vehicles -- the Saturn Aura Green Line, Vue Green Line and Chevrolet Malibu Hybrid. One source even told Automotive News that GM can't switch battery suppliers until its next-generation technology bows in 2010.

The recall in late 2007 forced GM to replace 9,000 faulty battery packs -- preventing the production of any new vehicles -- but Cobasys' production line is once again up and running.