New York, New York – Ener1, a manufacturer of advanced lithium-ion batteries, has applied for US$480 million in low-interest funds under a new federal program designed to spur development of the next generation of fuel-efficient vehicles in the U.S.

The funds would be supplied to EnerDel, the first and currently the only U.S. company producing advanced lithium-ion batteries, which is a subsidiary of Ener1. The company is applying for the funds under the Department of Energy’s Advanced Technology Vehicle Manufacturing Incentive Program, a $25 billion plan designed to enable U.S. auto companies and their suppliers to build or retool manufacturing facilities in order to improve the overall corporate average fuel economy (CAFE) of the domestic auto industry.

“Advanced lithium-ion battery technology is a basic need for every automaker in the world today, and that need will grow steadily,” said Charles Gassenheimer, chairman and CEO of Ener1. “Building a strong U.S. supply chain in this rapidly emerging industry is a top priority to maintain competitiveness vis-a-vis foreign manufacturers that have already invested very heavily in this linchpin technology.”

If it receives the funding, EnerDel will be able to double its manufacturing capacity to produce 600,000 hybrid electric vehicle packs per year at its existing plant by 2011, and to build a second, larger plant capable of producing battery packs for up to 1.2 million vehicles by 2015. The projects are expected to create more than 1,300 new jobs.

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