Automotive News - February 11, 2008 - (Page 14) 14 • FEBRUARY 11, 2008 EDITORIAL STAFF Who might kill the Chevy Volt? 3 suspects could foil GM’s plug-in plans Bradley Berman It has been more than a year since General Motors unveiled its visionary Chevrolet Volt plug-in hybrid concept vehicle. GM promises that the Volt will enable most Americans to drive 40 miles each day without burning a single drop of petroleum. Instead, the energy will come from next-generation batteries recharged from a common household electrical outlet. Since the Volt’s introduction at last year’s Detroit auto show, the General’s PR machinery has buzzed with ever-increasing intensity, churning out news releases, keynote speeches and TV commercials extolling the vehicle’s virtues. The intensity of the buzz is matched by the fervor of GM executives and engineers — a level of enthusiasm and dedication bordering on zeal. The target date for Volt sales is 2010. I’ve met several times with Volt team leaders, and I’ve seen the fire in their eyes. But enthusiasm and a big budget do not ensure victory over those who would kill the Volt. Below is a futuristic whodunit; take a look at it five years from now to see which suspect proved to be guilty as charged. 313-446-0361 E-mail autonews@crain.com Web site www.autonews.com Keith E. Crain Publisher and Editor-in-Chief Peter Brown Associate Publisher and Editorial Director DETROIT 313-446-0361 Fax: 313-446-0383 1155 Gratiot Ave. Detroit, MI 48207-2997 David Sedgwick Editor dsedgwick@crain.com Edward Lapham Executive Editor elapham@crain.com Richard Johnson Managing Editor rjohnson@crain.com John K. Teahen Jr. Senior Editor Mary Beth Vander Schaaf Deputy Managing Editor Charles Child International Editor General Motors executives and engineers are enthusiastic about the Chevrolet Volt, the writer says, but enthusiasm and a large budget may not be enough to get the plug-in hybrid to market in 2010, as GM plans. David Kushma Retail Editor Dave Guilford News Editor Philip Nussel Special Projects Editor James B. Treece Industry Editor Karen Faust O’Rourke Insight Editor COPY EDITORS: Bob Allen, Tom Fetters, Patricia C. Foley, Kenn Jones, Gregory Skwira Susan Zavela Bamford/Graphics Editor Rick Kranz/Product Editor REPORTERS: Leslie J. Allen, David Barkholz, Mary Connelly, Ralph Kisiel, Jamie LaReau, Arlena Sawyers, Robert Sherefkin, Richard Truett, Bradford Wernle, Amy Wilson Mary Raetz Senior Statistician Debi Domby, Camille Pippen Research Assistants Dan Jones Office Manager Robertta Savage Editorial Assistant comment Bradley Berman is editor of HybridCars.com. those advanced technologies on the shelf, even though Toyota soldiered on and launched the Prius. A drop of $20 to $30 a barrel in oil prices, even if it lasts only a few months, could deal a crippling blow to the Volt. Then again, oil-producing countries and companies say they don’t manipulate prices. Suspect 1: OPEC Of course, our friends in Dhahran and Caracas are not literally trying to undermine GM’s plug-in hybrid project. But innovations such as the Volt and other advanced renewable energy technologies are born of necessity. As long as the price of oil hovers around $100 a barrel, car companies will try to develop fuel-efficient automobiles. Some predict that the price of oil will climb even higher. The oil price shocks of the 1970s, which brought the first wave of small, gas-sipping Japanese cars to American shores, didn’t last forever. Subsequent oil spikes came and went and subsided to pave the way for the SUV era. In the 1990s, the U.S. government invested $1 billion in hybrid research, but by the late 1990s, oil had dropped to $11 a barrel. With prices at the pump skirting $1 a gallon late in the decade, Detroit decided to leave That was 10 years. Last year, Toyota sold its millionth hybrid, and only now is it claiming to make a profit from its gasoline-electric cars. Recouping the investment on a plug-in hybrid with 40-mile all-electric range may take even longer. If the Volt comes to market by 2010, then GM won’t make greenbacks from its ultimate green car until 2020. That shouldn’t matter if the company has the long-term picture in mind. But stockholders want results this quarter, not in a decade. GM’s broader financial challenges could pull the plug on the Volt. Suspect 3: Sir Isaac Newton The laws of economics are a formidable challenge to the Volt, but they’re nothing when compared with the laws of physics. GM is basing all its plans for the Volt on the development of lithium ion battery technology, which has never been used for powering a production vehicle. That battery technology is unproven yet critical to enabling the Volt to carry enough energy for 40 miles of all-electric driving. Testing of lithium ion batteries in the lab, and even on test vehicles, looks promising, say GM executives. But before any car company can commit to more than a few prototype units, it must know how those batteries will perform in the real world. Any defect in manufacturing could be fatal to the project. Remember those Dell laptops that caught fire? Those were similar lithium ion batteries. When batteries are pushed to and beyond physical limitations — and there are limitations — then the longevity and safety of those batteries are compromised. Will GM be willing to take those risks? Or will the company face a perpetual series of delays because Sir Isaac Newton’s essential law of physics doesn’t bend to corporate will? Any one of those threats— lower gasoline prices, shaky company finances or unproven battery durability — might not be enough to stop GM’s plug-in hybrid project. But two out of three could mean the end of the Chevrolet Volt. What do you think? We would like to hear from you. Send a letter to the editor via e-mail (autonews@crain.com) or to the Detroit address near the top of the box at right. Here’s what we need. No more than 250 words Your name and title, company name if we can print it, city and state; or tell us about your connection to the auto industry Your phone number or e-mail address Your permission to print it Suspect 2: GM shareholders GM will invest tens, maybe hundreds, of millions of dollars in the project before it sees a penny of profit. How long will GM be willing to subsidize a big, splashy project that doesn’t directly help the bottom line — especially if the company continues to suffer billion-dollar losses and dwindling sales in the shrinking U.S. market? I put that to Bob Lutz, GM’s product guru, the morning before the Volt was unveiled in Detroit. He said, “About as long as Toyota subsidized the Prius.” Corinne M. Price, Michael Garrison Information Center LOS ANGELES Mark Rechtin/Bureau Chief 310-739-8009 Fax: 310-832-6362 Kathy Jackson/Reporter 323-370-2481 Fax: 323-655-8157 6500 Wilshire Blvd. Los Angeles, CA 90048-4947 NEW YORK Diana T. Kurylko/Reporter Phone/fax: 908-273-6059 dkurylko@crain.com WASHINGTON Donna Harris/Reporter 540-668-7295 Fax: 540-668-7296 Harry Stoffer/Reporter 202-662-7212 Fax: 202-638-3155 814 National Press Building Washington, DC 20045-1801 MID-SOUTH Lindsay Chappell/Bureau Chief 615-371-6654 Fax: 615-371-6655 April Wortham/Reporter 615-371-6617 104 East Park Drive, Suite 315, Brentwood, TN 37027 TOKYO Hans Greimel/Asia Editor +81-3-3828-9060 Fax: +81-3-3828-9061 hgreimel@crain.com Yurakucho Denki Bldg., 20th Floor 1-7-1 Yurakucho, Chiyoda-ku, Tokyo 100-0006, Japan SHANGHAI Alysha Webb/Bureau Chief +86-21-6226-9485 Fax: +86-21-6226-9483 alyshawebb@yahoo.com TURIN Luca Ciferri/Reporter lciferri@craincom.de +39-011 961 0194 Fax: +39-011 961 0113 Viale Cavaglia, 8 10029 Villastellone (TO) Italy STAFF CORRESPONDENT: Eric Freedman/Legal file, 517-337-0269 www.autonews.com DETROIT Victor Galvan/Web Editor vgalvan@crain.com 313-446-0345 Scott Kennedy/Multimedia Editor Chinese automakers need new-energy incentives Alysha Webb For years it seemed that the Chinese government was ahead of the U.S. government in the promotion of newenergy cars, such as hybrids, electrics and fuel-cell-powered vehicles. But now it seems as though the United States is moving ahead while China is treading water. The Chinese government in 2004 said it would take every necessary step, including policy support, to promote hybrids and fuel cells. Some fuel cell projects got funding from the government. The government also urged Chinese automakers such as Shanghai Automotive Indus- comment Alysha Webb is the Shanghai bureau chief of Automotive News. tries Corp. to develop such cars. But four years later, automakers are still waiting for the preferential policies. Those could include more govern- It seems as though the United States is moving ahead while China is treading water. ment support for research or tax incentives for consumers who buy hybrid or electric cars. Wang Chuanfu, president of BYD Auto Co., says BYD wants the majority of its production to be hybrids or electric vehicles in the future. But that depends on preferential tax policies to encourage consumers to buy them. Meanwhile, American automakers are all developing hybrid and other new-energy models. And the U.S. government just announced a three-year, $60 million public-private partnership to foster plug-in hybrid technology. China still has a chance to be a leader in new-energy cars. But China’s government must get behind the effort with more than just words. You may e-mail Alysha Webb at alyshawebb@yahoo.com http://www.autonews.com http://HybridCars.com http://www.autonews.com
For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.