GM tries to unplug Volt hype.

[lightfoot]

Good points. But isn't it a gamble either way? If GM sits there and gathers test data for a few years before adopting new battery technologies while a competitor plunges ahead, GM will lose in the short term (until problems with the competitor's batteries crop up) and possibly in the long term (if there are no problems with the batteries). OTOH if GM uses the new technologies, as you say they may face a rash of battery replacement issues in a few years.

In a way, this has already happened with Toyota and Honda gambling to jump into NiMH technology and (apparently) figuring they will deal with any problems that arise. Maybe limiting its exposure with new technology was another reason why Honda didn't push Insights; this was a clever way to gather real-world battery data. The jury is probably still out on the Civic and Prius batteries.

Who knows, the market may come to accept that batteries need to be replaced during the lifetime of a car. The volume of battery production may bring the cost down, and/or a battery rebuilding/recycling industry may develop that will also reduce the cost. As gas prices rise, 4-5 years of reduced fuel costs with a hybrid or a plug-in may cover the cost of a battery replacement.

One strategy for GM might be to use the new technology in only one of its family of brand names, say Saturn. Then if there are problems it might not reflect quite as badly on GM as a whole.

[msantos]

Wayne, you captured some very valid points.

I may also add the following (particularly in case of Honda or Toyota):
Both Honda and Toyota (but especially Toyota) are run like monster oligarchies where all part suppliers are "part of the family". "Outsiders" have a very hard time getting close to either of the companies' core competencies. They are no good unless they can be bought.

Chances are that if an important component in car, which in this case a battery pack would be, is manufactured by an external entity (with a large collection of investors applying pressure for a quick return on their investment) neither Honda nor Toyota will look at that company's technology as viable or even profitable. If they can't control it then they cannot manage risk. It is that simple.
The way both japanese car makers can make money and build upon their reputation is to "own" a significant part of each part supplier so that they control the IP, the manufacturing processes and quality, the price and hence the profit margin... and also retain some exclusivity and the much needed market edge.

I am not too sure about GM (or Ford's) management models, and whether this approach applies to them too. I suspect not entirely if at all.

The thing about companies like A123Systems is that they are not the most attractive business partners to established giants like Toyota and Honda. At this pont, these emerging companies have their own agressive and focused management, investors, goals and great expectations and worse of all, they are too public and not easily controllable in a way that either Toyota or Honda would want them to be as parts suppliers.

So what would either Toyota and Honda do? We'll as they already indicated, they would rather research and develop their own next generation battery technology. They've poored billions over the last decade alone to ensure that if any critical technology is used in their cars that it belongs close "to home". On the other hand, the licensing costs for a technology they do not own would have to be extremely low to mitigate the risks and increase the profit viability.

Where does that leave companies like A123Systems? In my opinion, they may have extremely good and capable technology but unless a favorable 'shift' happens - and this shift can have many faces - their technology may need to continue to develop. Because according to some analysts, there's still much room for improvement and where there is improvement, there is a lower price potential and a higher yield manufacturing that can put most auto makers' worries to rest.

I remain faithful that such a shift can occur. Perhaps GM will be the main driver of that shift. I don't really know.

Anyhow, it remains a complicated world not bound to get any easier.

Cheers;

MSantos

[psyshack]

I don't think its the battery's at all...

I think its a marketing move. Just look at the volt. It looks like it came from the Camaro stable. And in all honestly. I think if produced it could at some level derail Camaro.

[xcel]

Hi Lightfoot and Msantos:

___Thank you for the detailed replies as it makes for an interesting discussion to say the least.

___With what you two have posted, I am very hopeful that A123Systems Li-Ion tech is a success for the domestics HEV/PHEV plans and is protected via enough patents so as to force the Japanese manufacturers to come to our table rather then we to there’s. It is one thing to desire the Toyota Prius III Li-Ion based PHEV before the details are even out (everyone here knows that I do) and yet another to hope for a successful Li-Ion based PHEV from GM, Ford or DCX in order to stave off the hemorrhaging they have endured these past 2 years. I have no ill will towards our domestics and would like to see them succeed in the worst way but it will only happen if “we” push GM/F/DCX into placing a HQ PHEV on the market before the Japanese do. This is a type of “last defense” in the case of the domestics because they simply cannot continue with their heads in the sand any longer. If A123Systems or JCI-SAFT will be the domestic auto manufacturers savior’s, better us then them given the $billions lost over the past 2 years

___In the case of US citizens being harmed because of the Japanese brilliance (or deceit?), it is indeed real and I would like to see a more positive outcome for our country’s large scale employers and our citizenry as a whole.

Hot new thing: driving the message. - Third section down.

___Psy, speaking with the guys in charge of the Volt, they do not believe it will have the current look once production (if production) is finalized. The Volt concept was pushing technology far beyond what I thought was practical or feasible from what we saw and GM has said the same in any number of Volt News items we have posted here since its January release.

___Good Luck

___Wayne

[xcel]

Hi All:

___Just when I thought my A123Systems quest would run out of steam, EV World does an Expose on yet another success story of these magic cels.

The Secret of the Killacycle's Success.


PHOTO CAPTION: Scotty Pollacheck astride the world's quickest electric motorcycle powered by $12,000 of A123 Systems M1 lithium-ion batteries. Despite pushing the batteries to the boiling point of water and sucking 4000 watts/kg of power from the pack, the team has yet to replace a single cell, proof these batteries are different in a big way.

___Good Luck

___Wayne

[Fenrir]

Originally Posted by xcel

I have no ill will towards our domestics and would like to see them succeed in the worst way but it will only happen if “we” push GM/F/DCX into placing a HQ PHEV on the market before the Japanese do. This is a type of “last defense” in the case of the domestics because they simply cannot continue with their heads in the sand any longer. If A123Systems or JCI-SAFT will be the domestic auto manufacturers savior’s, better us then them given the $billions lost over the past 2 years

Agreed. The failure of our domestic auto companies is very bad news for the economy. All the more reason for GM to tell it like it is instead of stretching the truth. They should stop saying "the battery doesn't exist" and start saying "the battery is still too expensive".

[hobbit]

Okay, I've read the posts about risk factor and reputation
and thought about it a bit, but it still isn't sitting well
with me. Look at the very earliest Prius battery packs --
they were crap, and several early-adopter Insight owners
found themselves in so much "recal hell" that they've got
newer packs by now. At this point I would argue that no
battery is 100% bulletproof but what's out there at this
moment in time is pretty good, and certainly usable to build
a BEV around. Darelldd over on Priuschat keeps pointing
out how the old NiMH pack in his rav4-EV is still going
strong and giving him over a hundred miles of range. And
that's without any internal-combustion boost.
.
At some point you've got to declare "good enough" and move
forward, anticipating the few problems that might come up
and handling contingencies. GM is out of time for excuses.
.
_H*

[ericbecky]

GM's Bob Lutz had a great response to this "unplugging the volt" article.

http://fastlane.gmblogs.com/

GM Charging Ahead with Volt

By Bob Lutz
GM Vice Chairman

I knew it wouldn’t be long before the naysayers came out.

We’re not unplugging anything. We revealed the Chevrolet Volt, our electrically driven concept vehicle, to much praise at the Detroit show in January. We said we knew we had a tough challenge to see it through, but that we’re committed to the program. We said, both then and recently here on FastLane, that we plan to keep everyone up to speed on our progress and to discuss openly and transparently the technological, engineering and design hurdles we face. Just a couple of weeks ago we had more than 100 journalists and interested parties join our team, including outside battery experts, to learn more about what is happening behind our lab doors.

I’ve said before that this is not a publicity stunt, but it’s as if people don’t want to believe it if we give them anything short of a guarantee of Volt delivery… with an exact date, time and sticker price.

I will say it here and I know I will have to say it again many times: We are 100 percent committed to making this happen. We are invigorated by the challenge. We are going to continue to be as transparent as we can in this process, knowing that there are some proprietary technology issues we will have to keep veiled. And we understand there are numerous obstacles ahead of us, but our team has set out on a clearly defined mission to develop technology that will transform the automobile. This is probably the toughest and most exciting effort GM has undertaken. There is no turning back.