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Wednesday, June 24, 2009

Is the US auto industry headed in the right direction?

Are US automakers really prepared for the future? Can US automakers compete in the fuel efficiency game? Can they compete at mass producing hybrid cars and plug-in vehicles?China's BYD hybrid on track for 2011 US launch

The other day a new University of Michigan study found that US automakers have perpetually underestimated the importance of fuel efficiency in the American market. However, a robust change towards fuel efficiency could be a huge cash cow for US automakers.

But are US automakers making the right moves?

America's most notable future product, in terms of fuel efficiency, is the Chevy Volt. Yet, the Volt's most important piece of technology, the lithium battery, is based on South Korea's LG Chem chemistry. Interestingly, LG Chem is also developing the cells to power Hyundai hybrids, another Korean company. Yet, if Hyundai has perfected the lithium polymer battery, Hyundai's battery technology might already be superior to GM's.

And what of smaller, cheaper cars and hybrids?

Again, there is Hyundai, but also BYD, Mahindra, Tata, and many other emerging automakers that could become very competitive within the next decade. And, many of these automakers - which have far cheaper labor costs - are building their entire business models on cheap, small vehicles and alternative technologies.

Moreover, like Hyundai, BYD has a hometown lithium cell provider, itself. BYD also has far easier access to lithium than does any US company.

Ultimately, I'm certainly not arguing that US automakers cannot compete, especially Ford. However, it seems US automakers need to think far beyond CAFE. If US automakers are to be successful a decade from now, don't they have to raise and lead the fuel efficiency bar across all automotive segments?

Labels: Hybrid Vehicles, lithium battery

posted by Dahcredyns at 9:00 AM

5 Comments:

Anonymous Anonymous said...

GM should be a battery producer if it should ever want to produce. Stop giving money to Chrysler and GM! This country, if anything, needs to get off their asses and realize that the American dream will DIE if we continue to allow China, Japan, and others to take advantage of us. Lets spend BILLIONS on battery technology and battery PLANTS/factories. We have the resources; why are we sitting around and let China do all the work... Oh wait! Cheap Labor! The American people should go on strike against the damn unions... Working 60 days, 8 hours a day 5 days a week, with the summer off and like 20 paid vacations/sick days doesn't work.

GM needs to get their feet on the ground with NiMh before they try lithium. They've basically failed with their two mode/mild hybird systems... now they're trying to be successful with Lithium? A technology which is extremely expensive and will put GM in the red for another 5-10 years? So what if Toyota gets their first; Americans will wait for the Volt, so long as the prospect doesn't escape their minds. Toyota and Honda did the right thing by staying with NiMh, for they will make millions on the Prius, along with Honda, with the Insight.

Oh, I'd rather die then buy a Chinese car, by the way.

10:45 AM  
Anonymous Anonymous said...

Oh, and Ford needs to get a smaller hybrid out fast.

And, I would rather buy a Kentucky and Tennessee Toyota and Honda then a South Korean-made GM...

Even Nissan manages to build over here...

10:48 AM  
Blogger Dahcredyns said...

i largely agree. somehow, however, the american people have to get involved. we have to accept that cheap gas and guzzlers is not the path to the american dream.

more important, we have to accept that the price of a gallon of gas costs far more than what we pay at the pump.

if the people can't accept that reality, then i'm not sure anything can really be done because we simply can't handle the truth.

11:08 AM  
Blogger Larry G said...

China? Try Hyundai (Korea), 5th largest in the world... and check out where it sits in the initial quality ratings also:

http://blogs.edmunds.com/strategies/2009/06/jd-power-releases-2009-initial-quality-study-results.html

Will Hyundai bring a plug-in to market before GM and will it be cheaper than the volt?

The good news in the JD Power quality report is that Ford and Chevrolet .. Cadillac, Mercury are playing up there with the big boys... Lexus, Toyota, Honda and... err.. Hyundai...

I think even Toyota fears Hyundai. Toyota is the "GM" of Japan - right?

8:36 PM  
Blogger Dahcredyns said...

Toyota, the GM of Japan, that's pretty funny, Larry. Unfortunately, Toyota is starting to feel like the GM of Japan, at least in terms of size. Fortunately, Toyota's product development has been a good bit more visionary than GM's. Still, Toyota has some obstacles in the road ahead.

I'm with you on Hyundai, and it was the quality rankings that really got my attention. In addition, I am very excited to see how Hyundai's lithium polymer technology plays out.

Nonetheless, Hyundai will not beat GM to the US market with a plug-in. However, Hyundai might have the best battery technology on the road, so their upside is huge.

11:58 AM  

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