GM-VOLT : Chevy Volt Electric Car Site

We recently heard that Bolivia has over one half the world’s known lithium reserves, and that mining those salts is very important to the future electric car industry. It is also known that politics and lack of development are stumbling blocks to a successful mining industry there.

A new report from Reuters indicates that Korea-based LG Chem, who has been chosen as the supplier of the Chevy Volts lithium-ion battery cells, has been seeking talks with the Bolivian government.

Evo Morales head the country and has been unfriendly towards the US and has nationalized the gas and petroleum industries there.

According to the report, Bolivia state mining director Freddy Beltran said “LG has expressed a willingness to start talks, to make a proposal. For what we know they have an agreement to produce lithium batteries for General Motors.”

Their goal is to be able to tap into Bolivia’s vast Uyuni salt lake, with rivals Mitsubishi of Japan, and Bollore of France already in the race for the reserves.

A pilot plant has begun construction and there are plans to have it operational by 2010. Although bids from Mitisubishi and Bollore have been made, talks have reportedly not advanced, and Bolivia’s “Morales government would welcome a proposal from LG.”

Source (Reuters)

The US Department of Energy has a loan program called the Advanced Technology Vehicles Manufacturing Incentive Program (ATVMIP).  Colloquially known as re-tooling loans, the legislation is section 136 of the  Energy Independence and Security Act of 2007.

These loans are intended for companies to use to create the facilities necessary to build high-efficiency advanced technology vehicles.

The total sum of available money is $25 billion dollars, and 75 applications were received.  Only 26 of these were considered “substantially complete.”  Funds are expected to be disbursed within the next one to two months.

General Motors has an application for $8.3 billion which they plan to use to build plug-in cars including the Chevy Volt.  Ford has asked for $5 billion to make 90% of its cars more efficient by 2014.

Start-up Tesla Motors has also asked for $450 million for use in building electric sedans and battery packs for selling to other car makers, and A123 systems has requested $1.84 billion to help build a US lithium-ion battery manufacturing plant.

Somewhat surprising however is that Japanese company Nissan has actually requested loans as well, but has not released details of how much or what for.

This move separates Nissan from the Japanese companies Toyota and Honda who have not requested loans.  Toyota’s US VP Irv Miler said “we’re not interested in being beholden to the government” and Honda’s VP of US affairs said “if it’s worth doing, we’ll do it on our own.”  Technically, there was no wording in the loan application to prevent foreign automakers from requesting them, something critics point out as a weakness of the loan’s language.

What do you think?

Source (Bloomberg)

Larry Burns is GM’s VP of R&D. After the Converj unveiling, he wrote a post asking the public to help GM make the Voltec drivetrain a widespread reality.

He indicates there are challenges to do so.

His solution is to create a partnership between automakers, suppliers, utilities companies, and the government to ensure electric transformation of the US automotive fleets.

He directs us to detailed remarks he made to the Transportation Research Board.

Those remarks are here and summarized as follows:

Burns says we now have a “once in a century” opportunity to change the way we drive, and directs us to the problems of pollution, dependence on foreign oil, and greenhouse gas emissions as some reasons for enacting this change. He notes nothing has to be invented for this to happen but all we have to do is exchange the “DNA” of current cars, by switching from combustion engines to electric motors, from petroleum to electricity, and from hydraulic controls to electronic ones.

He presents the Chevy Volt and how it works, and says of the car “we expect to announce an impressive combined city/highway fuel economy very soon.”

He also notes the Volt will cost 80 cents or less per day for most people to operate, and that renewable sources could create its electric energy.

He says that electric car manufacturing has to mature and that they actually use 60% less parts and 1/10th the number of moving parts.

To make electric vehicles the norm he recommends an agenda be set and that 5 steps be taken:

1. All parties should act with a collective will to transform holistically.
2. Develop a comprehensive transportation blueprint among all stakeholders
3. Focus on attain market tipping point in favor of electrification
4. Embrace a portfolio of solutions, not “a silver bullet,” i.e. E-REVs, BEVs, and fuel cells
5. Set ambitious goals and hold ourselves to attaining them

He concludes “General Motors, therefore, is urging the creation of such a partnership that would involve the U.S. government, auto manufacturers and suppliers, the energy and infrastructure industries, and other key stakeholders.” and says “This is also a promising time. President-elect Obama’s initiatives regarding transportation infrastructure and technology and his commitment to science and fact-based decision-making are very encouraging.”

Source (FastLane)

Today is truly a historic one for the US automotive industry, and for the dream of petroleum independence and the Chevy Volt.

After weeks of intense political wrangling and nail-biting financial drama, US President George Bush has agreed to grant low interest loans to GM and Chrysler.

As he just announced those loans will be sufficient to allow GM and Chrysler to operate until March 31 2009. GM will receive its first $4 billion on December 29th, and an additional $5.4 billion on January 16th 2009. It could get another $4 billion on February 17th if the second half of the TARP is released.

Bush said normally he wouldn’t have intervened and would have allowed the companies to fail, but cited the current finical crisis as being extenuating circumstances. He determined allowing the automaker to collapse would be devastating to the economy. Bush also agreed with the automakers that a disorderly bankruptcy would cause them to fail and liquidate as consumers wouldn’t buy their cars.

The automakers will be given until March 31, 2009 to prove they can restructure and obtain net positive value, but not necessarily profitability. They must obtain meaningful compensation from labor and debtholders. If they fail to meet those goals, the loans will come due and they will have to file for an orderly chapter 11 bankruptcy.

Government would take non-voting stock in the companies, and there would be limits to executive compensation. The Treasury would oversee the restructuring.

The following specifics have been published by Politico.com:

Binding Terms and Conditions: The binding terms and conditions established by the Treasury will mirror those that were voted favorably by a majority of both Houses of Congress, including:
—Firms must provide warrants for non-voting stock.
—Firms must accept limits on executive compensation and eliminate perks such as corporate jets.
—Debt owed to the government would be senior to other debts, to the extent permitted by law.
—Firms must allow the government to examine their books and records.
—Firms must report and the government has the power to block any large transactions (> $100 M).
—Firms must comply with applicable Federal fuel efficiency and emissions requirements.
—Firms must not issue new dividends while they owe government debt.

Targets: The terms and conditions established by Treasury will include additional targets that were the subject of Congressional negotiations but did not come to a vote, including:

—Reduce debts by 2/3 via a debt for equity exchange.
—Make one-half of VEBA payments in the form of stock.
—Eliminate the jobs bank.
—Work rules that are competitive with transplant auto manufacturers by 12/31/09.
—Wages that are competitive with those of transplant auto manufacturers by 12/31/09.

The drama of the end game seems to be picking up steam. Despite early reports that the Bush administration would announce loan plans to GM by Wednesday, still no word. Most recently, White House press secretary Dana Perino said “there’s nothing new on the auto front.”

President Bush discussed the topic on Wednesday on a Fox News interview and said the following:
“I’m thinking through, you know, it needs to get done relatively soon. I’m looking at all options. Two principles by which I’m making this decision is … a disorganized failure, disorganized bankruptcy or disorderly bankruptcy would cause, could cause great harm to the economy — beyond that which we’re now witnessing, and that concerns me. And the other point is that … I’m not interested in, in really putting good money after bad, so it’s … an issue that I’m thinking through.” (Reuters)

Chrysler announced it will be shutting down all vehicle production at all of its 30 plants beginning this Friday for a period ending no sooner than January 19th. As we’ve heard GM has had to shut down construction of the Volt engine plant.

However, a senior GM executive stated that GM will continue efforts to build the Volt even if the government loans don’t come through. This person said “although we are temporarily absolutely stopping all work on everything, the Volt will be out as originally scheduled.”

Reportedly there are plans in place such that even if GM goes into bankruptcy it will still have funds set aside to carry the Volt to production. It was noted that even if the Flint factory doesn’t get built in time, the 1.4 L engine generator could be sourced from overseas. (CNN)

Sources familiar with the White House discussions advise me though that the bailout negotiations are progressing and because there is “no playbook for this” it takes time. Those sources reassure us that a conclusion will be coming soon.

Furthermore new reports indicate that Chrysler is attempting to revive merger discussions with GM again in an effort to prove to the government they are serious about restructuring. GM has denied this.

GM is down to only days left of funding and we wait anxiously to see if and how the Bush administration will provide loans to keep them going, and keep hope alive for the Chevy Volt. It seems an answer will be coming very soon.

As of Late Monday Bush himself gave reassurance to the automakers saying, “We’re now in the process of working with the stakeholders on a way forward. We’re not quite ready to announce that yet.”

Even Vice-President Cheney confirmed these intentions noting “We’re on the downside of a recession that may be the worst since World War II. And if the automobile industry goes belly up now, there’s a deep concern that that would be a major shock to the system.”

Senator Carl Levin (D-Mich) thinks the deal the White House gives GM will mirror what the Democratic bill had offered, $8 billion for GM and have the Treasury Secretary acting as car czar. Levin also said an announcement could come as early as Wednesday.

Since there is only $15 billion conveniently left in TARP that would cover their immediate needs as well.

In any event time is running precariously short and Mr. Bush recognizes that noting “this will not be a long process because of the economic fragility of the autos.”

And the clock ticks on.

Source (AP) and (Reuters)