EVcast #212: News About the VOLT

Hi guys,

I thought that GM's announcement that it was going to build 1 million plug-ins by 2015 is by current production history a pipe dream. Recall that it took Toyota about 10 years to sell 1 million Prius's. They crossed the 1 millionth Prius sold back in May of 2008. http://blog.wired.com/cars/2008/05/prius-sales-top.html That gave the Prius about 2.3% of the U.S. car market. Factor in that there were also limiting factors that prevented Toyota from selling more than what they actually sold.

The first limitation was, of course, that Toyota had to halt production of the Prius when the supply of NiMH batteries couldn't keep up with demand. Now NiMH technology is mature and the performance of these batteries is a known quantity. Toyota also has a preferred arrangement with Panasonic to provide the NiMHs. With Panasonic's pending merger with Sanyo, Panasonic's share of the NiMH market is expected to jump from 10% to 35% of the global market so Toyota should have far fewer problems with battery inventory into the future. http://www.greencarcongress.com/2008/12/panasonic-buyin.html LiONs have not been used in large quantities in EVs and are not yet manufactured in sufficient quantities to fill a tall order of 1 million Volts by 2015. However if the Obama administration has plans to subsidize the domestic battery market this might change. There is historical precedence for setting up a domestic industry.

In the late 1980's the U.S. computer industry got the government to allow a Dynamic Random Access Memory (DRAM) consortium to be setup but the results didn't pan out as expected. The Federal Government's role was to permit the existance of the consortium and not to prosecute the America IT company participants under the Sherman Anti-trust act. Back then the Japanese dominated that industry by the late 1980's. Now many of them are made in South Korea or China. The program was also privately funded but the stakes are higher today and so federal money may be seriously considered as seed money until the domestic LiON battery industry becomes established.

The second limiting factor was that when the price of gasoline went down the demand fell too. An incentive will have to be made to buy a plug-in like the Volt, such as the current $7,500 tax credit, or a dis-incentive, like a carbon cap & trade policy or direct carbon tax, to put a price tag on externalities of using gasoline. Perhaps a combination of the might also be the solution.

Even with all this federal underwriting GM is still going to have a rough road to travel to reach this goal of 1 million vehicles.

That's my take on it.

Rick, from the Oil Capitol of the World, Houston, TX. 

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As GM is the devil-de-jour, I guess a lot of us watch with a certain smug satisfaction as they struggle for their very existence, shedding big hunks of itself as it waddles towards a possible EV future.  While people can point to the decision to kill the EV1 as the reasons for their problems today, I will argue that it really isn’t the MAIN reason.  The modern auto industry is a very complex industry with battles going on at many fronts.  Here are the real problems, in my opinion:

1. big lumbering company with big overhead costs
2. gm doesn’t compete in the small car market (10 truck but only one small car platform? Plus one small car from Korea?  Come-on!)
3. no new or exciting REAL products (I don’t count the volt)

The Obama administration panned the volt, declaring it too expensive.  I’d agree.  Depending on the firmware version (and how far it's driven) it’s either a normal hybrid, a plug-in hybrid or electric car with battery backup.  It’s great technology but too high a cost given the performance.

If I were GM, I would try to leverage their core battery management competency to a hybrid project they can get out the door ASAP.  I would license the Honda hybrid powertrain (or Toyota) and see how much better gas mileage they can get with their battery technology in a cool small car design (think Mini or Nissan Cube) for less than $20k.  The Japanese companies probably already have this… which pains me to think just how far behind GM really is.

GM could also do something really brave and market a pure EV again… somehow, I don’t think it’s in the cards.  Even if it wasn’t the best business decision, they should consider bringing back the EV1 or some pure EV if only because it would garner some decent press.  Even a souped up NEV could go a long way to improving their image.

It’s no secret what’s needed to save GM.  They have to become a smaller (more efficient), decent, modern car company that doesn’t ignore important markets (small cars).  The volt is impressive but it won’t save GM.

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   I have to respectfully disagree with Jonathan. 

      The Chevy Volt is an exciting and innovative car that will bring business in GM's direction.  Simply copying the competition with a small car hybrid is not the best approach because you have no way to differentiate yourself other than being American Made.  Building a GM based Prius killer would be a difficult road.

   With regards to the EV1, sure you could sell some of them, but I don't think the value would be as great as the Volt and volumes would be low.  I look at the EV1 as being very similar to the Old Honda Insight.  A small 2 seater car that Honda pulled from the market due to low sales.  I think this would be the fate of a renewed EV1.

    So I think Chevy has the right product with the Volt.  It clearly differentiates them from all the competition. They just need to keep the costs reasonable and they can leapfrog the Prius with their American Made beauty.  (FYI, I am a Prius owner.)

    I wish the Volt program the best of success even while I have very mixed feelings about GM as a company.

Later
John C. Briggs

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I agree with Jon in that cancelling the EV-1 was really not a big factor in GM's collapse.  It really was due to legacy healthcare costs, cars that people didn't want, and an over-reliance on heavy SUVs & trucks that stopped selling when gas prices went up. 

The EV-1 had an enthusiastic following but it was never profitable and had almost no chance of becoming profitable.  But they way they pulled the plug on it was even more foolish than continuing the program.  They were served a huge PR disaster and they lost a lot of EV development & experience.  They should have kept it as a money-losing program which served as a R&D division for future products.  If they had, they would have had lots of low power electronics & a good low Cd body design already such that the Volt would have been on the road today instead of still in development.

But I agree with John in that the Volt is a great move to leap-frog the current hybrid designs.  With the battery-pack proportional subsidy, the Volt will be able to move people onto pure electric drive which will be needed as gas prices rise again.

But the US consumer needs to start getting used to smaller cars . . . they are inevitable.   You'll either being driving small efficient cars that reduce the needed battery size so they cost a reasonable amount or you will be driving small efficient cars because the high cost $4+ gas is forcing you to drive one.  So either way, get used to it Americans.

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Dag,

You stole my thunder.  I do think we will either have to adjust to smaller more efficient cars like the 2011 Chevy Cruze (built on the same chassis as the Volt but gets 40 mpg highway which is better than the Toyota Yaris and city mileage to be announced) or to hybrids or plug-in hybrids like the Volt.

I still see single occupant Hummer H2s and H3's or Ford F150s with crew cabs on my commute to and from work here in Houston. Texas is the land of the pickup truck and large SUV. Before the price of gasoline and diesel really skyrocketed I saw two tractor trailer cabs modified into personal vehicles on two separate occasions. I didn't notice it at first until I heard the ying, ying, ying of the diesel on a small residential street and it startled me. I figured by this time some people had really gone insane with this choice for personal vehicle. Americans will still want their land based Air Craft carriers and will not give them up easily however, they will, grudgingly give them up as gasoline prices go on their inevitable path upwards.

The problem for me with cars like the EV1, although very appealing to drive, it is a two seater and if I were married with no child I could adopt it but with 3 it's too much to give up to go EV since I need the space for my wife and son. So the Volt gives me the passenger space I need and 40 miles range is about right for me. I don't mind if the engine comes on for the last 5 or 10 miles so that the engine is kept in good shape. But I suspect I might be able to run it completely in battery mode if I moderately hypermile it (NO A/C with slow acceleration and deceleration) on my 50 mile round trip commute.

Rick, from the oil capitol of the world, Houston, TX.

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