DETROIT - Lithium-ion battery supplier A123 Systems said on Thursday that it had signed a deal to supply power packs for the Fisker Karma, a rechargeable luxury car being launched later this year.

A123 also said it would invest $23 million in a funding round for Fisker Automotive, an ambitious venture capital-backed start-up behind the Karma and a lower-cost plug-in hybrid car to launch in 2012.

The announcement of the closely watched supply deal comes a day after EnerDel, an Indiana-based unit of Ener1, said it had broken off talks with Fisker to be its battery supplier for the Karma.

Fisker was the recipient of a $528 million low-cost loan from the U.S. government to help fund its expansion plans, including a still-pending deal to buy an abandoned Delaware assembly plant from General Motors Co.

As a condition of receiving that government loan, Fisker has been raising additional equity from investors.

The Los Angeles-area start-up counts Silicon Valley-based Kleiner Perkins Caufield & Byers as an investor and plans to deliver its first Karma models in September.

In a statement, Boston-based A123 said that making the investment in Fisker would closely align the interests of both companies and allow them to work together on future vehicles.

The Fisker Karma, which is designed to travel 50 miles on a single charge and accelerate to 60 miles per hour from a standing start in six seconds, will sell for $87,900.

The Karma will be built in Finland by Valmet Automotive and will carry a powerful battery pack designed to allow it to travel 50 miles on electric power alone.

Fisker founder and Chief Executive Henrik Fisker said on Wednesday that EnerDel had not been able to meet the automaker's production schedule for the Karma.

He said A123 had been selected because of the company's ability to meet our performance needs and rapidly scale to our production volume.

A123, the recipient of a $249 million grant from the U.S. Department of Energy, is expanding a battery cell plant in Livonia, Michigan and building a coating facility in nearby Romulus.

The expansion will increase A123's production capacity by 18 percent and give it the annual ability to supply batteries for about 24,000 plug-in hybrids like the Karma.

(Reporting by Kevin Krolicki, editing by Dave Zimmerman)