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GM's Lutz Says Automaker Must Have Hybrids Despite Expense and Doubtful Benefit

PHOTO (select to view enlarged photo)
Lutz makes a point while launching GM's full size SUVS in Detroit last September

London UK July 19, 2006; Just-Auto interviewed GM's Bob Lutz at the London Auto Show: "Hybrids are technologically of doubtful benefit, and expensive, but necessary from a political and public relations point of view", according to General Motors vice president, global product development [aka ‘GM product czar’] Bob Lutz.

Speaking on the sidelines of the Opel/Vauxhall Corsa global launch in London today (18 July), Lutz said GM currently offered two levels of hybrid systems. The “simple one”, in the Saturn Vue, “has engine shut-down at idle, automatic re-start with the throttle, a limited amount of electric drive which keeps the motor small and lets you get away with a very small, inexpensive battery pack.

“It gets 18% [fuel consumption reduction] on the US urban cycle so it’s worth it,” Lutz said.

GM also offers a “very complex, very sophisticated” two-mode hybrid system which, Lutz noted, came from the Allison bus transmission operation and is being re-engineered for light trucks and passengers cars in the joint venture between GM, Mercedes and BMW.

“We will launch it next year in full-size pick-up trucks,” Lutz said. “That is a very sophisticated system. We will get between 25 and 30% fuel economy gain but it’s also a pretty expensive system.”

He agreed that these trucks were upmarket enough to carry the extra cost but cautioned: “It becomes the issue of how much of the extra cost you pass on to the customer.” He admitted GM would absorb some of the cost, in fact.

So are hybrids the way to go?

“Toyota has said, economically, hybrids make no sense. The reduction in fuel [consumption] does not pay for the technological content and cost of the vehicle so therefore economically it remains fairly nonsensical, so that’s the left-brain analytical argument.

“The right brain is it’s the popular thing to do, many people believe that if we all drove hybrids the world would suddenly get cooler again and then it’s the patriotic thing to do because if you drive a hybrid you will no longer be funding the Arab terrorists, and so forth.

“So, with all those beliefs out there, you have to do a hybrid for public policy reasons.”

Lutz added that hybrids were technologically interesting and he enjoyed driving them.

“We’ve got some big electric [Chevrolet] Tahoe prototypes and I enjoy driving those because you can drive them electrically if you drive carefully.”

Asked if hybrids were a pain for automakers, Lutz said: “I would say it’s a necessary technology from a public policy and PR standpoint and technologically of doubtful benefit - costing every company that does them a lot of money.”

Turning to the subject of diesel hybrids, he noted: “The modern diesel is becoming more and more expensive as we have to have to gear up to meet Euro 5, which is very difficult.

“Then you have US Bin 5, which in terms of NOx emissions is five times tougher than Euro 5 and very difficult to meet - with a lot of control technology plus it will require an NOx reduction catalyst using urea which the US government hasn’t quite approved yet.

“Assuming we can do all that, [for] a diesel hybrid you would be adding $US5-7,000 on-cost for the sophisticated hybrid system to the $5-7,000 on-cost for a Bin 5-compliant diesel. Now you’ve got a $12-14,000 cost penalty in the vehicle which the customer would simply never, ever [pay].”

Told that PSA had said recently, also coincidentally, in London, that it hoped to get the cost of its diesel hybrids, currently in prototype form, down to a “meaningful level”, Lutz said: “Toyota says the same thing and we will undoubtedly get cost out of the system [but] you take 50% out and you’ve still got a $6,000 cost penalty.

“Let’s not forget, a diesel engine is always going to be more expensive than a conventional petrol engine, that’s the laws of physics. Adding electric motors, regenerative braking, a lithium-ion battery pack and an extensive, multi-function electronic control unit that deals with all these algorithms to make sure everything work together smoothly is on-cost!

“I don’t care how much money you get out but when you’ve got two drivetrains, the sophisticated electronics and a big lithium-ion battery, you’ve got cost.”

Graeme Roberts