GM-VOLT : Chevy Volt Electric Car Site

If you had envisioned yourself putting in a winning bid and skipping to the front of the line on a 2011 Chevrolet Volt on eBay, this news is not good. GM has decided to not extend the program into October, effectively ending the experiment last Wednesday, September 30th.

In a totally unrelated matter, I have a Californian postal address for sale if anyone is interested.

The eBay-GM collaboration came to life shortly after GM itself came out of bankruptcy protection. Mark LaNeve, GM vice president of U.S. sales, saw it as “…GM and our dealers reinventing the car-buying experience for our California customers.” /very optimistic indeed

Transactions through eBay have been offered from GM (through dealers) since August 11th. During this time, a buyer could choose from the two traditional eBay options consumers had grown accustom to at the site: ‘buy it now’ or ‘best offer.’

During the initial 30 days of the program, GM had amassed approximately 50 sales on over 16,000 listings…none of those sales were of the ‘buy it now’ variety.

According to Edmunds.com, part of the failure of the program was that the TMV (True Market Value) of the vehicles listed on eBay were 2% higher than the actual average selling price that occurred in dealership showrooms.

When the program was first announced, Ed Peper (Chevrolet Brand Manager) was asked by GM-Volt how this new system could impact sales on the upcoming Chevrolet Volt. Could eBay possibly be a tool to enable the company to sell early Volts through the auction system at a profit?

“Exactly right. We actually have been thinking about that same application to be able to do that, It something that’s definitely crossed our mind.”

Now, however, along with Mr. Peper moving to Cadillac, so too seems to have left his Volt idea.

GM-Volt reached out to GM spokesperson John McDonald for confirmation and clarification on this development, and he kindly responded:

GM and eBay concluded their six-week California Program September 30. The program has been a tremendous learning opportunity and a good example of GM trying new, innovative ways to reach consumers. The leads and the quality of traffic was tremendous and we delivered over 15,000 quality leads to our dealerships and had over 1.9M inventory searches on the microsite. This pilot is ending as planned and we will be looking to eBay for opportunities in the future. With our successful certified used pilot and the success of this pilot we see an opportunity to work with eBay to generate qualified traffic to our dealerships. One method that we are currently exploring is the inclusion of eBay in our third party lead program which consolidates internet leads and provides them to our dealerships.

It’s too early to say how we’ll market Volt. I suspect eBay won’t be needed to generate interest or awareness of the product — and that’s the main benefit of eBay.

It would seem, at least for now, that the traditional way to buy a car is still the best way.

Prabakhar Patil is the CEO of Compact Power Inc, the subsidiary of LG Chem that has been working with GM to produce the Volt’s battery packs.

I recently had the chance to ask him about the cost of lithium-ion batteries.  As some sources suggest cost could be as high as $1000 kwh, I asked him what the actual cost is in today’s market.  My question with his explanation follows:

What is the cost of lithium ion automotive batteries?
Is its risky or dangerous to quote direct numbers.

At the cell level, in consumer applications, 100% of the nominal capacity at the beginning of life is somewhere on the order of $350 per kwh.

First, we have to keep adding factors for in a vehicle application, when you look at it as a 10 year life and you have this 25% degradation, then your denominator goes down by 25%.

Secondly, if you’re not using all of the capacity, just the combination of those two factors will effectively cut the denominator in half in terms of usable capacity at the end of life as opposed to nominal capacity at the beginning of life. And that will raise the price in dollars per kwh, if you do it in terms of usable capacity at the end of life, by a factor of two

Third, if you add all of the other stuff you have to put in the pack, and it depends on what you consider inside the pack as opposed to outside, because that depends on vehicle architecture. So that’s why it gets very fuzzy and inconclusive to talk about gross level numbers unless you know specifically on how they are being defined.

The other perspective is that lithium ion in the 17 years since it was first introduced has come down by a factor of 14 in terms of dollars per kwh and it’s not done. It will continue to come down not at the same rate, but I fully expect over the next 5 to 10 years for the cost to get better by anywhere from a factor of 2 to 4 in terms of dollars per kwh as compared to where we are now.

One of the things that has nothing to do with the cell or any technology itself, is at the end of life if the battery still has 70 to 75% of its power and energy left.  Why throw it away when you can recapture it? If you could capture that residual value by effectively leasing the battery and putting it to work again in a utility application, at 50% of its initial value, it will cut the effective cost by a factor of two.

With the demise of the Cash for Clunkers program last month, it was expected that auto sales industry wide would suffer, however the car buying public continues to be reluctant to embrace the two government supported automakers, shunning both GM and Chrysler in September.

For the month, General Motors reported that sales nose-dived 45% on 156,673 vehicles sold, while Chrysler reported sales off 42%. Certainly some of these losses can be attributed to the vacuum left by the CARS program, but it is impossible to ignore the monthly sales of their peers.

Cross town rival Ford posted a much better than expected net loss of only 5% and ended this quarter up 2%.  Japanese rival Toyota was off 13%. The only major automaker to buck the trend this month was Hyundai and its sibling Kia, both offering smaller and inexpensive vehicles, reporting a increase of 27% and 24% respectively.

After the month of August only showed a drop of -20%, Mark LaNeve (VP of US Sales) was hopeful a turnaround was in the works saying, “…our momentum continues to build on the strength of our new cars” and touted the retail sales turnaround at GM. With the failure to make good on that prediction, along with a drop in retail sales of 46%, Mr. LaNeve conceded that August was “a more difficult month than we anticipated.”

Mr. LaNeve is no stranger to showing optimism when looking to the future, and offered this forecast, “Fortunately, the fourth quarter looks brighter and our year-over-year comparisons should look more favorable…we believe that our four core brands – Chevrolet, GMC, Buick and Cadillac – are well positioned with new products to generate enthusiasm with our 60-Day Satisfaction Guarantee and ‘May the Best Car Win’ marketing campaigns”

Inside the numbers, the hardest hit was GMC, widely considered to be GM’s most profitable brand, sales for the month were off 53%. Chevrolet was off 40%, Buick 33%, and Cadillac enjoyed a nice rebound on the strength of the new SRX’s introduction, off 9%.

If numbers like these persist, one has to wonder what the value of a anticipated summer IPO will be for GM, and what hope the government has to regain any of their considerable investment in this American institution. In the short term, with the continuation of poor results, a major executive shakeup seems inevitable.

Like all recent auto shows before it, the upcoming Tokyo Motor Show will offer a showcase of new electrified vehicles.

Two examples that seem particularly important are entries from Mitsubishi and Honda.

Mitsubishi is unveiling what it calls the PX-MiEV. This crossover seems to be a conglomerate of all things; its is a plugin hybrid, a parallel hybrid, a series hybrid, and an EV.

The front and rear wheels are powered by two electric motors that total 60 kw, and there is a 1.6 L gas engine that can both power the front wheels and act as a generator. All of the driving configurations are managed by a power control unit and software called the “MiEV OS.”

EV mode can be automatically switched between front wheel drive or 4 wheel rive depending on road conditions. When the battery is depleted to a certain level, the vehicle transforms into Volt-like series hybrid operation where the generator simply provides energy for the electric motors. However unlike the Volt, when power demands become high, the engine can also turn the wheels supplementing the electric motors as a parallel hybrid configuration.

The EV mode range is 31 miles from a full charge, and the car seats 4.

Mitsubishi claims the vehicle will achieve about 117 MPG overall.

Also Honda has finally taken its first baby step into the electric car arena and is unveiling its pure BEV concept called the EV-N. This is a retro styled 4 seat mini car that Honda says is purely a design study and that there are no plans for production.

They are also revealing the CR-Z sports hybrid which is similar to the Insight in mild hybrid engineering only does 0 to 60 in 9 seconds instead of the Insight’s 11 seconds. It will go into production in 2010.