Detroit, Michigan – A deal to supply Chrysler with batteries for the Fiat 500 electric vehicle (EV) project has fallen through, as reported by the Green Car Congress.

A123 Systems, which was supposed to supply batteries for the project, has withdrawn after reporting a second-quarter loss of US$34.2 million, on top of a loss of $21.9 million a year ago.

Chrysler and A123 announced a partnership last March to produce an unspecified number of battery-powered Fiat 500 EVs in 2012 at Chrysler’s plant in Toluca, Mexico, where gasoline versions of the 500 will be built starting later this year.

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