Bob Lutz, the Chevy Volt and the Easter Bunny
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Bob Lutz, GM's vice chairman for product development, told a group of
automotive journalists that the feasibility of the Chevy Volt plug-in
hybrid concept will be proven by next Easter. By that time, he said that
GM will have put the Volt's electric drive system and lithium batteries
in stripped down Chevy Malibu bodies -- referred to as "mule" vehicles
-- and tested the ability of the Volt system to achieve 40 miles of
gas-free range. The vehicle is primarily powered by an electric motor,
with a small gasoline engine on board to extend its range.

Mr. Lutz made his comments in San Francisco at a meeting of the Western
Automotive Journalists association, where he received the organization's
"Anti-gravity Award," for a lifetime achievement in the automotive
industry. The playful title of the award was meant to recognize Lutz for
his ability to repeatedly resist naysayers to his plans for producing
ground-breaking vehicles.

Fighting Words

Mr. Lutz then took on naysayers of GM's advanced technology plans --
throwing barbs equally at competitors, environmentalists, the oil
industry, and Democrats. The most direct attack was levied at Toyota.
Lutz referred to comments made by his counterpart at Toyota, Kazuo
Okamoto, executive vice president of R&D and product development.
Okamoto questioned GM's ability to deliver on its plans for the Chevy
Volt at the recent Tokyo Auto Show. The two companies have been waging a
war of words over competing plans for hybrid and electric vehicles.
According to Lutz, Okamoto accused GM of using the Volt concept as a
marketing ruse, and chatacterized the lithium battery-powered Volt as
"completely wacky" and "nonsense."

Referring to GM plans to demonstrate extended electric range of the Volt
next spring, Lutz said, "Let's wait for the Easter Bunny. Somebody's
going to have egg on their face. And I don't like having egg on my
face." He said that Japanese companies were guarding its advanced
battery technology research and refused to bid on GM's battery
proposals. "Lithium battery technology is being husbanded in Japan. It's
like a secret weapon." At the same time, Lutz criticized the U.S.
government for not keeping up with the Japanese government's funding of
advanced battery research.

Higher Gas Taxes

Mr. Lutz, considered GM's product guru, was critical of
environmentalists, especially the Union of Concerned Scientists (UCS)
which advocates for using existing technologies -- such as better
aerodynamics, lower tire resistance and more efficient transmissions --
to produce significant fuel economy gains. Mr. Lutz and UCS officials
met privately last spring. "I'm not sure if they are concerned," he
said. "But they are certainly not scientists." According to Lutz, GM and
the auto industry has already "tapped out" on obtaining fuel efficiency
benefits from conventional technologies. "We are at the very steep part
of that curve."

Mr. Lutz then criticized current Democratic proposals to raise Corporate
Average Fuel Efficiency (CAFE) standards. He singled out Barack Obama
and Hillary Clinton as a playing a political game of one-upmanship with
competing unrealistic plans to raise required fuel efficiency to 40 mpg
in the next decade or so. "CAFE is a totally flawed strategy," said
Lutz. "It has never worked and it never will." He remarked that
achieving those levels of fuel efficiency will raise the cost of
vehicles by $6,000 or $7,000, which consumers will not be willing to
pay. Lutz suggested that raising gas taxes was a more effective solution
to getting consumers to drive less and to drive smaller vehicles. "If I
were dictator of America, I would gradually raise the price of gasoline
by 25 cents every six months or so, until it's more in line with gas
prices in the rest of the world."

When the floor was opened to questions, Mr. Lutz was asked about the
wisdom of producing vehicles that can run on an 85-percent blend of
ethanol -- based on the questionable environmental, energy, and economic
benefits of the alternative fuel. He responded by accusing the American
Petroleum Institute of running a multi-million dollar smear campaign
against ethanol. "They make it sound like ethanol is taking food out of
the mouths of babes. According to them, we're going to have taco riots
in Mexico because of ethanol." Lutz did admit that the net energy
benefits of corn-based ethanol are "not what we would like to see" and
pointed to the development of next-generation cellulosic ethanol as a
necessary step.

Countdown to Easter

Lutz's barbs could be dismissed as mere bravado, if it were not for his
conviction that GM has a genuine solution to the long-term environmental
and energy challenges facing the auto industry. The company is
allocating considerable resources to the Chevy Volt. More than 600
employees across the globe are working on the project, and the company
is aggressively hiring battery engineers. Lutz said, "Whether you're
talking about weaning us off imported oil, reducing CO2, or cleaning up
air pollution in the L.A. basin, the electric vehicle with a gasoline
range extender is the ideal solution." There's never been so much
anticipation for the Easter Bunny in Detroit.

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