'We're entering an exciting new phase for the automotive industry where we increase the electrification of vehicles, reducing consumption of gasoline through advanced batteries. This new facility would greatly accelerate this change and help ensure that the American economy replaces its dependence on foreign oil with reliance on advanced, homegrown batteries,' said David Vieau, CEO and president of A123Systems. Vieau said that he couldn't elaborate on the company's plans since it is in a 'quiet period' because it filed for an initial public offering in August. In November, the state approved $10 million that the company is using to help it scout locations in Michigan, but it has not yet formally committed to building a plant. If it gets the government loan, however, A123 expects to also build an additional plant beyond the Michigan facility and said the combined plants would eventually occupy as much as 7 million square feet and create more than 14,000 jobs. These plants would produce battery cells and systems for A123's automotive clients, which include 19 vehicle models from at least seven manufacturers. Lou Rhodes, vice president of advanced engineering for Chrysler LLC and head of its electric vehicle unit, ENVI, said the company already works with A123Systems and strongly backs the effort. 'Chrysler strongly encourages the efforts of A123Systems to develop and mass produce energy storage systems in the United States,' Rhodes said in a statement. Bob Lutz, GM's vice chairman and head of global product development, also praised the effort. 'At GM, we see the development of vehicles powered by electricity as key to the transformation of our industry. And advanced battery technology is at the heart of this transformation,' Lutz said in a statement. 'A123's proposal to manufacture advanced battery cells and packs right here in the United States is a positive development for our industry and the nation..' A123 grew out of the research labs of the Massachusetts Institute of Technology and was initially backed by a $100,000 grant from the U.S. Department of Energy in 2001. Existing A123 customers include AES, BAE Systems, Black and Decker, Cessna, Chrysler and GM. Michigan officials also praised the effort. 'This plant will be a showcase to our economic turnaround in Michigan. We look forward to working with A123Systems to support their growth in our state,' Michigan Gov. Jennifer Granholm said in a statement. Last fall, Congress approved a tax credit of up to $7,500 for plug-in hybrid vehicles. GM plans to begin producing its plug-in electric dual-mode Chevrolet Volt late next year. Reliable low-cost batteries have emerged as a key hurdle to widespread production of plug-in hybrids -- and the growth of hybrid sales. The Volt's battery is expected to cost GM around $10,000 per vehicle.