Volt Battery Update Transcript
SPEAKERS
PRESENTATION
R. Peterson: Good afternoon, everyone. This is Rob Peterson. Thanks for joining us this afternoon. As we have done in the past three years we’ve been trying to keep everybody abreast with the Chevrolet Volt. For the last year and a half, every six months or so we’ve managed to get a couple members of the engineering team on a conference call with you to provide you an update of the things that are happening out of the public side.
Today we have two of the leading executives on the Volt Development Team. Micky Bly is the Executive Director for Global Electrical Systems, Hybrids, Electric Vehicles, and Batteries as well as Andrew Farah, who is the Volt and Ampera Vehicle Chief Engineer.
Many things have happened since the last time we’ve spoken about six months ago, in fact, the middle of November. The teams have been busily working as they approach the launch here later this year. And so we thought that this would be a great time for us to bring you up to speed on some of those and to get right into it, I’m going to turn it over to Andrew Farah and let him get started and provide you with any details.
One small note is that we’ve got a brief presentation. After the presentation is over we’ll open up the lines for questions and the Operator will give you the instructions as to how to ask those questions at that point in time.
So, with all that, I’ll turn it over to Andrew.
A. Farah: Good afternoon, everybody. I’m just going to go through a few slides. Again, the idea here is to really get to the Q&A opportunities here, but, again, picking up from where we left off in November, trying to fill in what’s happened since then and hopefully take all your questions.
Just to kind of remind everybody, obviously, we’re going after a great vehicle because that’s what the customer sees, feels, drives. But that takes a lot of players and, of course, in the electric vehicle area it first takes a great battery, which has to be supported not just from the battery with LG Chem, but also by a number of other great suppliers, such as Goodyear, TRW, etc.
But at the same time here we are developing a number of things internal to General Motors, such as the software and controls that we need both for the battery as well as other systems. And also critical to this is the thermal management system, which is sometimes overlooked a little bit here as we go on, but it’s an area where we’re making great internal strides in what we’re doing here for electric vehicles.
Again, we’re always trying to optimize the different ideas of performance, durability with quality, safety, etc., as you see here on the slide. But the most important thing to remember is as we’re going off to make an electrical vehicle; the vehicle is not a support system for the battery.
The vehicle is a support system for modern life and for having people do what they need to do, getting from point A to point B. And in order to be able to do that we’ve got to make sure that electric vehicles like the Volt are viewed as relevant to today’s consumer and we think we’re doing that quite well with the Volt and as you see here the Volt is capable of being your first and only vehicle in the family and that’s a very important distinction with an electric vehicle with extended range.
We are putting in place a large production volume solution. In other words, we are working with our Detroit/Hamtramck vehicle production facility to make this something that we can make in large quantities. We need to have a vehicle that has predictable performance. In other words, you don’t have to plan your day around the vehicle; the vehicle does everything that you want to do like you would normally do.
Similarly, we can be independent of the public electric infrastructure. Infrastructure will continue to develop, but we can be out there today now doing what consumers need. Obviously, we will be safe and up to all General Motors standards. We will also be fun to drive. And this is something that I think some of you may have had an opportunity to drive the vehicle over the last few months and, hopefully, you’ve come away with that same feeling.
We also like to think of the Volt as being very affordable, when you think about what it provides, the idea that it can be your only vehicle in the family, you don’t have to have other vehicles in order to go from wherever it is you need to go and do whatever you need to do.
So, again, progress has continued. Just a quick look here and I’ll kind of review the lower timeline here. We’ve had a number of different vehicles builds that we have accomplished on time. We did our original engineering development vehicles back in ’07 and ’08. We did a number of MULE vehicles and then last summer we did what you see here, called the PPO pre-production vehicles where we built about 80 of those.
We have recently begun pre-production in our Detroit/Hamtramck facility just a couple of weeks ago. We have now six vehicles that are on the ground, some of them scheduled to leave the plant and get out to our Milford Proving Grounds later this week.
Also just to add, too, we will be building the first versions of the Opel Ampera later this month and those will also come out of our pre-production facility in Warren, Michigan.
Just a little recap, again, from November. We said that we were going to build the first battery and that battery was built in Brownstown, along with an investment of some $43 million in that facility. We had talked about making investments in the vehicle assembly plant. We made that announcement in December and have also invested $336 million there.
We have doubled our test miles since November from about a quarter of a million to a half a million and we had cold weather testing that had been set up and I’ll tell you a little more about that in some later slides.
Again, the progress continues and I might add on time. We’ve been able to hit all of the different milestones here and as you can see we used the engineering development vehicles just to work the basic concept. We had the MULE vehicles where we worked the power train and chassis development.
With the pre-production vehicles from last summer we focused a lot on plug in charging and the car customer interaction because that was the first time we had vehicles that were production intent relative to their interiors and controls and things.
And then here as we start in Detroit/Hamtramck we’re working on issues of fit, finish, buildability, those kinds of things, but underlying all these different phases, a very critical area is our software and controls. This is the glue and/or, if you will, muscles and things that really pull this whole vehicle together and make the whole thing work and this will continue to be a focus all the way through our manufacturing validation activities and start of production fourth quarter, later this year.
Okay, just a little bit on winter testing. We’ve done a lot of things; I’ll just focus briefly here on some of the work we’ve done up in Kapuskasing, Ontario where we did a lot of work on vehicle and engine start up. Clearly, electric vehicle you think it is easy to make it start in cold temperatures; well, it isn’t as easy as you might think, but we had a lot of work we had to do there.
Cold weather durability, thermal management, again, making sure that the battery and all the power electronics are appropriately managed and, of course, heating, ventilation and air conditioning, making sure the customer is also feeling the way they want to feel.
Up in Raco, Michigan we were working our winter surface development, both snow, ice, a little bit of off-road, not the kind you might be thinking, but what happens if a vehicle accidentally goes off-road, can you get it back on, those kinds of things up in Raco with TRW our partner there.
And also then out in Summit County, Colorado working altitude as well as mountain gradability. So, all of that really went quite well. I’m very happy with where we are.
In mid-March we had our most recent what we call calibration drive. We basically drove around southeast Michigan trying to make sure that we are ready to go into the emissions testing phases. First phases of our emissions work, we want to have the vehicle at a certain level of capability and I’m pretty happy with where we are there. We made a decision to move forward.
As you can see here on the right is just a screen, actually a photograph of one of the screens in the car showing a portion of that drive, really almost hitting our 40 miles. It’s 39.9 as you can see. I’m not really very disappointed in that. I’m very happy because if you look at the temperature of 40 degrees F, that’s pretty good. So, I think we’re well on our way to hitting all of the numbers that we’ve promised relative to electric vehicle range.
And then recently – and I think we’re going to see a little video here – I talked with you about building the first pre-production vehicles in the Detroit/Hamtramck plant. There’s the first one going down the line here and I think what you’re going to see is the plant manager drive it off the end of the line. This was a great moment in moving forward here to get to production.
The plant learned a lot. We learned a lot about the vehicle, a few little things we need to tweak and tune, but overall very successful. We built six vehicles over the last couple of weeks and some of them have been spotted around town in certain places.
Just to kind of wrap up here with a little bit about the future, clearly we’ll be having a number of additional calibration drive activities over the next few months. We will be doing hot weather testing out at the Yuma proving grounds as well as much, much more.
We will also be doing our typical, if you will, General Motors captured test fleet, which will come out of that next build of vehicles you see there called manufacturing validation vehicles. We’ll have about 300 vehicles being driven by different General Motors employees on the road so we can really learn all of the things that might not have come out in development and engineering usage and those kinds of things and we should have time to make any tweaks and tunes that come out of that.
So, again, moving along we’re on time, everything from the vehicle perspective where it is; batteries performing well in the vehicles. Here to give you a little more on the batteries themselves is Micky Bly and then we’ll go into Q&A.
M. Bly: Thanks, Andrew. Good afternoon, everyone. I’m going to cover what I think is probably the most talked about portion of the vehicle other than the vehicle itself, which is where we are with the battery development. My team has the great pleasure of helping Andrew by supplying all of the electrical systems on the vehicle, including the battery.
I know there has been a lot of news over the last few months and years on the battery development, I just wanted to give you an update on that. As the vehicle has moved along there were a lot of milestones that Andrew walked through, which indicated that we are either completing on time or increasing or pulling ahead a lot of the activities.
This looks at it from a battery perspective. The battery is, obviously, key from the potential of the electric vehicle. As you can see, back in 2007 when we started and announced the cell that we were reusing with this, which was our LG Chem cell, we’ve got a number of items in the last three years, including building the first prototype pack, which was back in October of 2007, which, by the way, is still in our lab running to this day without any issues at all.
We then moved into another build phase in 2008, which we had an outside supplier, which is a division of LG Chem, CPI, to build somewhere between 50 and 300 packs, depending on how you count those. But around that time we also made the decision that not only would we design the pack itself, we’d also start bringing that in house from a fully integrated system and also manufacturing.
So, as we moved forward into the early part of 2010 we did deliver as an engineering and manufacturing team at General Motors our first pack and what we call the Battery Job One. That pack is actually on test today with, again, no issues at all.
We’ll be building about 300 packs as we try out the assembly line the assembly process as we start tuning in everything from the operators on the line to the supply chain to shipping the parts in from all over the world as they come together here in our Michigan facility. Moving forward we’re going to be looking at turning on the production switches, which will be fully productionized, fully capable, fully run at rate over the summer up until the launch later this year.
All these to this date have been outstanding performance of not only the battery, but the people and the process behind it with great results so far. As Andrew showed you how what we promised back at the November update of how the battery was doing and what it will do; if you remember back in November, if you were with us, we had built about 300 battery packs at the time, which were prototype pieces, hand built.
Since that time we’ve built 50 of these now in our GM facility at Brownstown. We had about 300 miles of customer simulated driving in a lab environment. We’re up to about 850,000 miles of testing to date, so, again, we’re able to accumulate miles 24 hours a day, seven days a week and our facility, our lab facility, is absolutely full of these running every condition – hot/cold, high humidity, low humidity, thermal shocks, you name it; we’re able to simulate those all at the same time where vehicles are limited to the geographic location that they’re at.
We opened up the facility as many announcements took place. We started production officially back in December of last year. Since then we’ve brought up our battery pack lab, which has been dedicated to the Voltec program, over 20 packs on test, as I mentioned.
We’ve now increased our capacity to do that with 30 on tests. And then, finally, we went from a pre-production supply chain to exercising the complete production supply chain, literally shipping cells all the way from the production tools in Korea on shipping containers across the ocean, across the country as they landed here in the Detroit area for assembly.
One of the things that’s been an enabler for GM to really move fast in this space and go from a very smart shopper of batteries to a leader in technology development has been our battery lab, our systems lab. About two years ago the company decided that we’re going to bring in our expertise in this area over a year and a half ago, which was in January.
We decided that we would not only build our manufacturing location, but we said we’d get a lab up and running and that came on line in June of 2009. The lab that’s in Warren, Michigan was one of the green projects of the year from the construction association. So, it wasn’t something we just threw together. We really thought through what this lab should be, how it should impact the environment, what materials we should use at the time and very grateful of the award that we received from that. It’s very hard to get.
And a milestone that we just achieved last month was we were able to get our lab fully ISO certified. First time, went through the audit and we were able to certify and the auditor’s comments were, “Unbelievable results for a new lab coming online.” So, really a dedicated effort of what we wanted to do, what we said we were going to do, and then our ability to execute it on time.
Not only do we have a lab here in Warren, but many people may be aware that this lab is just one of many labs that GM has been investing around globally and it really comes down to the people in our labs, the products that we’re working on and tying in our processes globally. We have two labs actually in Warren; one doing more chemistry-based testing and one doing pack.
We have another facility in Mainz-Kastel, Germany and then a third facility in Honeoye Falls, New York. All of these labs are now able to tie together seamlessly our data integration.
Another announcement that came out late last year that we would be and are currently installing a lab in Shanghai, China, so that we’re able to test cells and modules at one of the regions that’s really developing lithium ion technology very quickly and keeps us from having to transport cells across the world for testing in one of our other facilities is really going to be a huge enabler for us.
And, as I said, we’re currently able to run all the labs 24/7. Any of our engineers are able to look at any test, anywhere in the world, any time of the day over the Internet to make sure they understand how their parts are running and how they’re performing all with their own in-house proprietary software to do that.
Some of you may have seen early this morning we did release a press announcement that because of the great success of our battery lab here in Warren and the leadership commitment to not only drive the Volt successful, but actually expand ourselves to the next generation technology, we did announce that we would be expanding the lab here in Warren, Michigan, putting about $8 million worth of investment into it.
It actually doubles the size of the lab in Warren, something we’re really proud of, not only having the state-of-the-art lab but now having more capacity and capability moving into the chargers, the infrastructure, the manufacturing, the tear down capability, the safety/abuse testing that we’re going to be able to do in there; all of these things we think are absolutely key and fundamental for any automotive company to understand the battery, the technology and how to maximize the selection of not only performance, but weigh that off with cost.
We know for a fact that the benefits in the lab today have been outstanding and we decided to move further into this and the announcement came out today. The lab will be up and running later this summer and we are going full throttle on this.
So, where are we going from here? As I mentioned, we’ve had great success up to this point, learned a lot. This has not been a walk in the park by anybody. We’ve brought on a lot of engineers, a lot of talent. We worked with a significant number of suppliers in this and developed suppliers, technology that didn’t even exist three years ago has been created because of the Volt program and because of that we’ve learned a lot, we’re applying that very quickly to generations two and generations three of the battery, something we think is important to ge tit down the cost curve as we move forward.
We’re fully ready and able to support Andrew and the Volt team and should have no issues between now and the end of the year getting the battery up and running.
R. Peterson: Thanks, Micky. Thanks, Andrew. At this point in time I think the best course of action is to get into the Q&A where I think you’ll have most of your specific questions and, again, the Operator will provide you with instructions and we’ll take those questions as they queue up.
Moderator: Thank you. Our first question comes from the line of Matthias Ruch from Financial Times in Germany. Please go ahead.
M. Ruch: Hello, I’m based in New York. I have two questions. First is, when will you start with the production of the Opel Ampera? And, second, did you already decide how many Volts and Amperas you need to produce per year to start a second production facility in Germany?
A. Farah: As I said, we’re starting pre-production; it’s actually already begun and, again, the first Opel Amperas will come out later this month. As far as the production timing, we haven’t announced specific production timing yet on that, except to say that it will be a 2012 model as introduced over in Europe. I don’t think we’ve released the exact dates and things on that yet so I’m not going to jump out and do that here.
Your second question was on volume?
M. Ruch: Yes.
A. Farah: Again, how much volume would we need to have a second facility?
M. Ruch: Right, I know you’re thinking about having a facility in Germany, but, of course, you need a higher volume so that it makes sense. So, how many cars do you need at Opel and Volt combined so that it makes sense to build a second facility in Germany or in England or wherever in Europe?
A. Farah: I haven’t seen that analysis, so I can’t answer your question, I’m sorry.
M. Ruch: All right.
Moderator: Our next question comes from the line of Katie Merx with Bloomberg News. Go ahead.
K. Merx: I was hoping that you could tell us how you’re doing as far as meeting targets for range, how many miles you’re getting per charge and how many miles per tank after that?
A. Farah: Things have been going quite well. We’re regularly hitting our 40 mile target and exceeding that, which is what we expect some people will be able to do. It depends a lot on how you drive, weather conditions, terrain. As you know, around here things are relatively flat so you don’t have to worry too much about terrain and with the weather getting nicer as it has been there’s less need for heating as well as just generally speaking all vehicles are more efficient in warmer weather.
So, as a matter of fact, this weekend alone I had at least two cycles that were over 40 miles. I think I drove one at 41.5 and another at 42.5, which was basically around town, Milford, etc., things like that. So, I’m very confident that the batteries are delivering the energy that they need to deliver and that the vehicles’ efficiency is where it should be.
We’re still doing a few last minute tweaks and tunes on the aerodynamics, but, again, that’s just to stabilize some things as far as that goes. And range on fuel, also very good. As you know, we haven’t announced any specific numbers. I still use the target of the original concept vehicle at 50 miles per gallon as the bogey relative to those kinds of things and so far I haven’t been disappointed. [Editor’s Note: This is a reference to a target of unadjusted fuel economy in extended range mode.]
K. Merx: So, is that 600 mile range then?
A. Farah: Well, that gets to the issue of the tank size. As you know, in every one of these meetings somebody asks me how big the tank is and I say we’re not releasing that information yet and we’re still not releasing it. But, as you know, we’ve also said you’ll get several hundred – you can view that as three or more – hundred miles of fuel range, so that’s still also the bogey.
K. Merx: Okay, so is that 50 miles per gallon after the 40 range or is that 50 miles per gallon total including the 40 range that you get for free kind of first?
A. Farah: No, the idea is more than 300 on fuel, on the gasoline.
K. Merx: All right, thanks.
Moderator: Thank you. And our next question comes from the line of Don Sherman, Automobile Magazine. Please go ahead.
D. Sherman: I was wondering if you could tell me the weight of a finished battery packs. I’ve read several figures for that; I’d like to be clear on it. Second question, do you anticipate air freighting any cells for production from Korea to Brownstown? Third question, has GM or LG Chem done any preparation for end of life for battery packs? What happens to them when their service is finished for Volts?
M. Bly: That’s three really good questions and I’ll try to get to those. I’ll start with the second question first as far as air freighting, our primary path for shipping of the battery cells – we’re only receiving cells in from LG Chem and Korea – is over the terrain, including water.
As you know, probably, and many out there, there has been a lot of discussion on shipability and air freightability of lithium ion. There’s a lot going on with the UN regulatory abilty to do that, a lot of certification of special shipping containers. All those things are in place now. We have been actively helping support that. The ability to ship certain amounts and quantities in air is possible, but we are not planning on exercising that as any of our primary paths.
Obviously, if something happens with our pipeline we would adjust as we do with anything today, but the expense and cost of air freighting is significantly higher and not something that we would want to do at this time as a matter of course. As I said, we’ve been actively working with the shipping industry as have all the battery suppliers around the world and OEMs.
As far as end of life, absolutely we’ve been working on a number of efforts with what happens or what do we need to do with end of life Volt batteries. Obviously, the one that we’re doing and most places are doing today with nickel metal is recyclability. There’s not as much material that’s recyclable and is valuable to the recycling industry.
So, there’s a lot going on with secondary use of batteries, whether it’s stationary power plants grid leveling, interruptable/non-interruptable supplies; a number of different opportunities. Now, the good news is we’re developing and designing this battery to last ten years, 150,000 miles so if we did our job right that’s not going to be an issue for us for a long time.
And it really is just developing as an industry right now to be honest with you. There are a lot of people looking at it, including power companies, switch gear manufacturers, cell phone towers; you name it, everybody has been knocking on the door playing in this space.
And then, back to your first question on the exact weight. I do apologize; I don’t have the exact weight, but 200 kilograms is the rough estimate of that and Brian Corbett could follow up with you a bit later if you need something more precise. But that’s within the realm of a few digits.
Moderator: Our next question comes from the line of Sam Abuelsamid with Autoblog. Please go ahead.
S. Abuelsamid: First of all, I wanted to ask on the prototype, the pre-production vehicles you’ve got so far, what’s the largest amount of mileage that you’ve got on any individual vehicle so far? And what kind of impact have you seen on the electric range as a result of accumulating miles on the vehicles as compared to what you’ve seen in the lab? And just to clarify what I think Andrew said a little while ago about the charge sustaining mode mileage you are, in fact, seeing 50 or so miles per gallon during charge sustaining mode?
A. Farah: Let’s try to take those one at a time here. The first one was number of miles on any car and, of course, I don’t have my sheet here with me with all the different cars and mileages and things, but we’ve completed a number of full durability cycles and things like that.
I think one of the vehicles, probably the one that’s got the most on it is in the low to mid-20 thousand miles. And, again, without a bunch of details in front of me.
M. Bly: But, having said that, Andrew, some of the durability, I think our simulated full life vehicle durability, we do accelerated life testing on those vehicles so they are equivalent to full life of the vehicle and we’re able to cycle through those much faster because of the amount of stress we put on the vehicles.
A. Farah: Not all miles are created equally I think is really the answer there. What was your second question, Sam?
S. Abuelsamid: Clarifying what you said earlier about the mileage in charge sustaining mode, so once you’ve exhausted the battery charge what kind of mileage you’re seeing at that point?
A. Farah: Yes, again, we’re not releasing exact numbers at this point. Again, the bogey that I still keep in my head is 50 mpg unadjusted, work in those numbers there. Again, we’ll release those as we get closer to production.
Moderator: Our next question comes from the line of Lyle Dennis with GM Volt. Please go ahead.
L. Dennis: Yes, hi. Two questions; one is there were some reports that the third generation pack, you know, how you’re working towards future packs, might be looking to have less longevity and be something that could be more easily replaceable and therefore cheaper because you don’t have all of the life sustaining systems in the pack.
And the second question is I understand that you might be working on some 2012 model year IV cars and I’m wondering what changes you’re putting in for that model year?
M. Bly: I’ll try to answer the first one and Andrew will do the vehicle in the second one. As far as third generation technologies, you’re probably referring to some articles or some information that was in Europe a couple of weeks ago.
L. Dennis: Yes, that’s right.
M. Bly: Right now, our third generation literally is at a very high level cell technology and our main focus on our cell technology is trying to decrease the cost significantly and you can read that as over 50% reduction of where we are today, so that we can make it with similar range much less of an expensive proposition for our customer point of view.
But, obviously, as we start balancing that architecture decision you could also easily make that a smaller battery from a cost point of view also, but, obviously, your range would be impacted by that. So we really are not in any position to say what we’re going to decide. In fact, we’re probably a couple of years away from selecting Gen 3 architectural requirements. In fact, Gen 2 is just getting to that stage by the end of this year, but we’re moving very, very quickly.
Generational changes used to mean four and five years between them. In this technology it’s two or three years that we’re trying to work on generational changes, to put it in perspective and I’ll let Andrew answer the second question.
A. Farah: Right, relative to 2012 there are no changes to the propulsion system per se, same architecture, same basic layout, same basic requirements. There are a few customer convenience and customer feature items that we’re looking at for 2010 and I won’t get into the list of those specifics.
But, again, not a significant change to the vehicle for 2012 with, of course, the exception of the Opel Ampera, which will have a different look to it, both exterior and interior in a few areas. So, again, no significant changes planned for 2012.
Moderator: Thank you. And the next question comes from the line of James Amend with Wards. Please go ahead.
J. Amend: Back to that range question, the all electric range. How much can that vary? How much are you seeing that vary between cold weather testing and warm weather testing? I’m also kind of curious about performance at elevations; I know you guys just did some testing in Colorado.
A. Farah: Right, okay, let’s talk a little bit about weather, temperature, and those kinds of things. I know I’ve said in the past that you might see as much as a 20% change in what you might get out of a full battery depending on temperature, how you like the cabin condition, terrain, those kinds of things. And, of course, the way the driver drives the vehicle, how aggressive they are is still the greatest factor. Terrain would be number two and then temperature and weather would be number three.
But, again, a 20% variation both directions is probably not unexpected. One critical part to being able to do that is still we’ve got a good thermal management system that’s trying to make sure that the battery is always ready to go, too. So, there will be a little bit of a difference depending on if you leave the vehicle unplugged in Bimidji, Minnesota at the airport for two weeks versus keeping it plugged in on a daily basis when you come home if you’ve been living, again, in Bimidji, Minnesota where it’s very cold.
So, again, we make sure we’re always trying to provide that consistent experience for the customer. And, of course, the great thing is even if you do have 20% less in range you’ve got the range extender to fall back on and therefore, again, from a customer perspective and doing what it is you need to do every day getting from point A to point B you’re not really inconvenienced one way or the other by the weather or the train or by how you drive.
Relative to gradability, mountains, etc., part of the reason that we went out there was, again, to continue the work we did last summer. We did that work more in the California climate out and into the desert mountains there. We did make a few adjustments in things, some of the different calibration parameters and things like that, but I think the great thing was climbing out of Denver to Eisenhower Pass, when I got to the tunnel I was still moving at over posted speed – I won’t say how much over – but that was really what we’re trying to get to.
And, obviously, there is the scenario of the infinitely long 6% grade and at some point you’re going to run out of battery power and you’re going to be limited in speed to what the generator and engine can produce and that’s just physics and there’s nothing you’re going to be able to do about it, but we think we’re packing enough buffer in there to be able to do most of those mountain passes.
J. Amend: Thanks.
M. Bly: Maybe I can follow up on just one part of that, one of the things that a lot of people like to understand is where is all this energy going in, let’s say, very, very cold conditions and the Volt we spent a lot of time on using the cabin heating system or cooling system and for the southern climates, to optimize the best we can.
But in a vehicle where you would not have paid any attention to that requirement, just kind of a talking point is it takes as much energy to keep a human warm in the northern climate as it does to push the entire vehicle down the road at posted speeds. So, that’s how much energy and if you’re running electrically on a vehicle that’s not really paying a lot of attention to that fact, you’re pulling as much out of that battery to keep the human warm and comfortable than you are pushing it down the road.
So, you can understand what the impact is. It’s not that the battery isn’t necessarily capable, but it’s where we or the other OEMs decide to spend their time to spend that energy. There’s only so much on board and you’ve got to make a choice. And we have made a very high efficiency cabin environment so we can spend more pushing the vehicle down the road and less worrying about trying to heat the drivers.
Moderator: And our next question comes from the line of Chris Vanderdoelen with The Windsor Star. Please go ahead.
C. Vanderdoelen: Good afternoon. I think this question might be for Micky. You said that in Generation 2 and 3 batteries you’re focusing on driving down the cost, but then you said that Gen 3 might be smaller. That hints at perhaps getting more range out of third generation. Is that true?
M. Bly: Let me make sure I heard your statement versus mine correctly. Obviously, Gen 2 we’re focusing significantly on the cost curve to bring down the technology with our supply base. And just so you know, we’re already seeing huge movement in our supply base in that area. Gen 3, what I tried to say is we’ll continue to try to drive the cost down and one thing we could do, not that we are going to do this, is we could look at a smaller battery proposition because also we feel that that time frame energy density is going to be going up significantly or at least measurably for Generation 3 technology from what the cell suppliers are working on today.
So we could get the same range out of a smaller battery, which then has an amplifying effect on cost value.
C. Vanderdoelen: Okay, but same range and smaller means greater range out of the same.
M. Bly: You’re right, absolutely, you could do that.
C. Vanderdoelen: Okay, thanks.
Moderator: Thank you. Our next question comes from the line of Lindsay Brook with Automotive Engineering. Please go ahead.
L. Brook: Yes, good afternoon, everyone. I’m curious as to whether you’ve worked through at this point all the EPA issues related to cold start in charge sustaining mode and when do you expect EPA certification for the ICE part of the package? Will that be later in the summer?
A. Farah: Obviously, as you know, Lindsay, the EPA hasn’t released all their final rules and things on how to do testing and what the label will be and all those different things. We’re still working with them on that, but yes it needs to be done quickly. As you know I want to be selling cars by the end of the year and it would be nice to have an EPA label in the window.
I think we’ll get through that with them. There was a team just out there going through it with them and I think even this week here in GSAE there is a panel on this very topic that I think will have both some people from OEMs as well as EPA on it. So, you know, that work is continuing.
The big question is, particularly with our vehicle because it has, if you will, such a dual personality how to make that work and how to make it not confusing to consumers. And that, I think, is very key also for part of the, if you will, the acceptance of electric vehicles. It’s the way that it works and extended range electric vehicles on top of that. It has to be understandable to the consumer and they’ve got to know what they’re getting basically.
L. Brook: If I could just follow up quickly, Andrew, from what you know that you’ll be expecting in terms of cold start emissions for this very unique power train, etc., are you comfortable at this point that you can meet what you know so far?
A. Farah: Oh, yes. I’m not too concerned about it. We’ve got great engine technology and we’re building on everything that’s come before us, so I’m not concerned about it. We’ve run preliminary tests and we’re not having any trouble meeting the emissions levels that we’re after.
M. Bly: Yes, Lindsay, we’re working in concert with EPA and CARB and all the regulatory agencies, from even NHTSA on a number of areas and every proposal that we’ve been working with them on, we see no issues with certification of emissions. The real issue, to be very direct, is how will the label come out from a fuel economy, fuel status, EV range and what will that label look like?
L. Brook: Very good, thank you.
M. Bly: It’s just a matter of telling us what the instructions are and we can execute them.
Moderator: Our next question comes from the line of Frank Sherosky, Detroit Automotive. Please go ahead.
F. Sherosky: Frank Sherosky, Examiner.com. Three questions; the first one is regarding future packs, we’re talking I guess Gen 3, with all the research labs doing work on ionic fluids for electrolytes and nano tube materials for anodes and cathodes, will your facility be involved in that type of development for Gen 3 or will that still be assigned to the GM research lab?
Second question is just charge times for 110 volt versus 220 volt? And, third question is is there any consideration for natural gas for the range extender engine, yes or no?
M. Bly: On the first question as far as how is the division of labor working on different configurations for Gen 3, I will just say that the two organizations, which is my organization, which really had advanced in production responsibility for the battery and then the research lab, which is underneath Alan Tobbs organization, are linked seamlessly.
In fact, all of the projects, all of the budgets, all of the testing status in our gate reviews are jointly decided, reviewed and approved. In fact, one of Alan’s researcher directors is on my staff as an indirect report so that we have absolutely seamless connectivity in this area.
So, there is no issue within GM at all of who’s doing what. The prioritization of that work is going very, very well and Mark Mathias, who is my Research Lead and Director on that is really just top notch for us in that space, so no issues there at all.
I missed your second question.
F. Sherosky: Second question was charge times for the present technology for 110 volts and the charge time for the 220 volt?
A. Farah: Right now our 120 volt charge times are eight to ten hours, depending on thermal conditioning and those kinds of things. We’ve just come out of the winter here so we were experiencing a little longer times in different things if it was cold out, which is to be expected.
However, 240 volt charging still coming in at around the four hour mark, even with that same level of thermal management, which is good. So, I’m suspecting we’re probably going to see a greater pull in the market for 240 volt charging just because of the basic convenience that it provides.
It’s very easy on a weekend to get multiple charges in a day with the 240 volt charge station, which really is not that different from a technical perspective than the portable cord set because the charger is on board. You know, when you buy the vehicle you’re really getting 240 volt conversion capability with the car.
The charge station is really a question of the national electric code requiring a hard mounted device to a wall, etc. So, again, you’ve got the capability there. We’re going to offer a product to put that in your home as well. For me, it’s very easy for me to get three full charges in a day with a 240 volt charge station.
I come out in the morning, it’s fully charged; I do my things, plug it back in when I get back, go out after lunch to get my home repair supplies, if you will, plug it back in when I get back and then when it’s time to go out to dinner, fully charged for a third round. So, I think we’re going to see that the 240 volt charging is going to be something that is sought after and well accepted.
Moderator: Thank you. Our next question is from the line of Chrissie Thompson, Automotive News. Please go ahead.
C. Thompson: I just wanted to first of all clarify, back to this 50 mile per gallon thing, is this after the charge totally runs out, then that’s what you can expect? Or, does that include the charge?
A. Farah: No, that’s what I was talking about. That’s in what we call the extended range mode assuming that you’ve already gotten your up to 40 miles in electric and not counting that as a part of the equation.
C. Thompson: Okay, great. And then my other question is with the announcement from this morning with the expansion of the battery lab and that sort of thing are you guys continuing to look at more applications of this Voltec technology now that the Converge is shelved?
M. Bly: Well, I’ll try to decouple the two. The expansion of the battery lab is allowing us to have one more capacity of testing, and also which allows us to work with a number of different suppliers that are out there in the battery cell area as we’re always looking for better capable technology as we move forward.
Obviously, what we have today is proving out great, but we’re actually expanding our reach into the electrification of the vehicle, spending more time in the charger development activity internal, some of our teardown capability, our manufacturing capability really looking at increasing more of our internally controlled capacity and capability and GM.
As far as how that expands, I’ll let Andrew speak to the second half.
A. Farah: The issue of being further application of the Voltec system into other vehicles?
C. Thompson: Yes.
A. Farah: Okay. We’re looking at that in a number of different places and things. However, we’re not ready to announce anything at this point.
C. Thompson: Okay, but it’s still on the table?
A. Farah: Oh, yes.
C. Thompson: How long should we expect to wait until we see something like that? Do you have a model year projection or something?
A. Farah: No, I don’t have any numbers for you. I’m sorry.
Moderator: Thank you. Our next question comes from the line of Paul Eisenstein with detroitbureau.com. Please go ahead.
P. Eisenstein: First of all, I have to apologize. I had some problems with the technical getting in and it took me a while to just get in via the phone, so I’m assuming from the part of the Q&A that I have been hearing that this is primarily an update. If there was any breakthrough news could I ask you to give me the thumbnail on that?
But one of the questions that I’d like to turn to is that of cost because there’s a bit of an apples and oranges thing going on out there. A lot of the talk about electrification is based on the best possible world where you have a utility that wants to go along with electrification, that comes up with a reduced rate on special charging where you’re charging is linked to grid load and that might be $0.02 a mile.
But if we’re talking about, Andrew, you mentioned during one of the earlier answers that you might do three cycles of charge during the typical weekend so you can keep going. Wouldn’t that be less likely to be at the overnight rate and wouldn’t that suddenly drive the cost up from, say, $0.02 a mile up to $0.05, or $0.06 or $0.08 a mile?
A. Farah: Actually, Paul, just the opposite. Most of the utilities that already offer a, if you will, time of day or off peak; generally speaking, weekends are off peak so you get the, if you will, weekday nighttime rate on the weekend. Because, again, industry is not out there using the energy and, again, it’s less expensive because they like to keep generating it.
So, I think actually it almost lines up too good to be true, that I can do that. Right now I don’t have that time of day service at my house. I’m still paying I think $0.11 a kilowatt hour, but I am planning to convert in the next few weeks here.
P. Eisenstein: Okay, you just hit the point, though, that there could be a particularly wide range depending on how and where you charge. If for some reason you need to charge during the day and you don’t have the interruptable, for example, that some people have for air conditioning and so on, you could go from a $0.02 a kilowatt hour up to a $0.10 or $0.11 a kilowatt hour, $0.15 in much of Michigan and so on. So the cost of energy could vary widely depending on who your provider is, time of day and so on.
A. Farah: Yes, obviously. I mean every utility has got their own set of rates and formulas, but I think when you sit down and do the calculation per mile and I did this a little bit the other day and I don’t have it all in front of me, but I still think electric rates would have to be significantly higher still to not have it be; I mean significantly higher than any of the numbers that you’ve mentioned before it became an issue relative to gasoline costs, today at $1.89 a gallon.
P. Eisenstein: Okay. And just that last thing, did I, in fact, miss some breaking news announcement when I came in? I do apologize to everyone who has been through; I just could not get on line.
R. Peterson: Paul, this is Rob Peterson. I’ll call you afterwards.
P. Eisenstein: Thank you very much, Rob.
Moderator: Thank you and our next question comes from the line of Alisa Priddle from Detroit News. Please go ahead.
A. Priddle: Hi, gentlemen. I just wanted to check. You made a mention for charging capacity capability that you would have a product to put in the home. Could you just elaborate a little bit about what that would be?
A. Farah: Right, and I think I’ve talked about this in the past. Right now our current plan is that every vehicle will come with the 120 volt cord set. With every vehicle there’s a place to store it in the back. Some of you have probably seen it.
But we also have a product that can be wall mounted and use as a 240 volt circuit, similar to your electric dryer, those kinds of things, and needs to be installed, generally speaking, by a professional or someone who knows what they’re doing anyway. So there is some issue with that. It’s not something that just anybody can take home and plug in, generally speaking because there’s probably not a 240 volt outlet in your garage so you have to have that added.
But, again, it’s not significantly different than having any electrical work done in your house.
M. Bly: But, Andrew, I think the important thing is to restate that the charger is onboard the vehicle. What we’re actually providing is just the cord connection between the power supply in your garage or outside your house to the vehicle. We’re not installing charger based equipment.
R. Peterson: We have time for one more question and we’ll wrap it up here.
Moderator: Yes, our last question will come from the line of Greg Migliore from Autoweek. Please go ahead.
G. Migliore: Good afternoon, gentlemen. You guys have gone over a figure, 230 miles per gallon a while back and I wasn’t quite sure what that was and is that figure still relevant today?
A. Farah: Well, the 230 per gallon number that was talked about I think a few months ago, this was based on some preliminary discussions with EPA and CARB and things about how the vehicle would be rated.
You heard us earlier say that those conversations have been continuing and have not yet completely come to a conclusion. But that was based on a set of information and some assumptions based on how far you would drive beyond your electric capability on some regular basis.
G. Migliore: Okay.
R. Peterson: Okay, with that I’d like to thank all of you for joining, thank Micky and Andrew as well. If you have any follow-up questions please feel free to contact either Brian Corbett at brian.corbett@gm.com or myself, Rob Peterson, that’s robert.d.peterson@gm.com and we’ll be glad to follow up with you.
Again, thank you, everyone for your time and looking forward to your feedback.
Moderator: And, ladies and gentlemen, this conference will be made available for replay today after 5:00 p.m. eastern through April 19th at midnight. You may access the AT&T Teleconference Replay system at any time by dialing 1-800-475-6701 and entering the access code 152834. International participants may dial 320-365-3844.
That does conclude our conference for today. Thank you for your participation and for using AT&T Executive Teleconference Service. You may now disconnect.
Copyright 2010
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