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The Volt's Uphill Battle at GM
This is an excerpt from Car Guys vs. Bean Counters: The Battle for the Soul of American Business by Haas alumnus and longtime automobile executive bob Lutz, BS 61, MBA 62.
In about 2005, I had the thought of creating a fully electric prototype as a show car. It would be an aerodynamic four-seater using very advanced (but unproven) lithium-ion batteries, giving it a claimed range per charge of roughly two hundred miles. A California high-tech idea and prototype company by the name of Applied Minds assured me it could build a running car. Excitedly, I shared this idea with my peers (and CEO Rick Wagoner) at an Automotive Strategy Board meeting, only to be cruelly shot down.
First, it wasn’t known, feasible technology. Second, it would send mixed signals: did GM believe in fuel cells, or did we believe in EVs? Third, our prior experience with EV1 should have convinced us that no market exists. And finally, the dreaded legal advice: we were engaged, along with most other car producers, in a lawsuit against the state of California over that state’s “EV mandates,” which were to force a certain percentage of vehicles sold in California to be electric. How could we fight the mandate and dangle an EV in front of the public at the same time?
I brought up the idea several more times, and was always silenced primarily by the argument that lithium-ion would not work. Powertrain and GM Research sent a series of battery engineers to my office to explain to me in no uncertain terms the severe limitations of lithium-ion chemistry. They just about had me convinced when the California startup Tesla Motors announced the creation of the Lotus Elise-based two-seat roadster, powered by 6,835 laptop batteries, with a top speed of 140 mph, acceleration time of zero to 60 in four seconds, and a range of 200 miles.
Naturally this gave me the lever I needed. Armed with the Tesla press clips, I once again harangued the Automotive Strategy Board, arguing that somebody out in California with far more battery experience than we had obviously decided that lithium-ion would work and was betting a lot of money on it. How could we, the world’s largest and, arguably, most technologically capable car company in the world, declare the lithium-ion battery not feasible for motor vehicles when some outfit run by a couple of dot-com billionaires was making it work?
This time, the meeting got me the very tentative permission to investigate a lithium-ion EV as a concept. It was, in retrospect, less permission than the absence of prohibition. Whatever . . . I ran with it. This might be called the germination of the Volt.
Hours after the meeting, I sat in my office with Jon Lauckner, now overseeing all vehicle line executives globally. We schemed about creating the GM “reputational shock therapy” vehicle we had both sought after for so long.
Lauckner listened, not so patiently, to my all-electric dream. When Jon has a thought that simply has to get out, he starts banging his knees together repeatedly. Banging them now, he said, “Look, I know you’ve got your heart set on an all-electric, but let me show you why that’s a bad idea. With lithium-ion, you get, assuming an efficient car, 5 miles per kilowatt/hour. So to get a 100-mile range, you need 20 kilowatt/hours. But since you never want to drain the whole battery because it impacts battery life, we’d want a 30-kilowatt battery. That’s huge. And even if we got the world’s best price on a lithium battery, you’d be talking $1,000 per kilowatt, or a $30,000 battery pack. And you don’t even have a car around it. And you’d still only have a 100-mile range on a good day!” He paused, and then continued: “Now, here’s my idea.”
With that, on a lined pad and using his expensive, gold-nibbed fountain pen, Jon laid out what was to become the Chevrolet Volt.
Published by Portfolio, a member of Penguin Group (USA) Inc.
Copyright 2011 by Bob Lutz.