By on May 7, 2010

Bob Lutz may have left GM, but TTAC’s not through with the man of Maximum just yet. One quote in particular, from an “exit interview” with gm-volt.com, exemplifies the kind of candor that seems likely to disappear from GM along with Lutz. Possibly for good reasons. Well, good PR reasons, anyway. After all, with Lutz unable to deny that GM will lose money and/or battle sticker shock with its forthcoming Volt EREV, he’s the kind of guy who will tell the unspeakable truth instead of playing coy like a good PR man. To wit:

How do we get the cost down without in any way diminishing the value of the car in the eyes of the customer? By just doing some more elegant engineering than we did the first time around where we inadvertently did some belt and suspenders stuff because we wanted to move fast. Now as we look back at the car we say ‘gee I wish we’d done his different,’ …’ gee I wish we’d done that different’ because this is a very expensive solution and we could have done that for a lot less money.

That faint sound you just heard was Ed Whitacre expelling fillet of rattlesnake out his nose after reading that little nugget. Meanwhile, you’ve heard it from the horse’s mouth: the Mk.1 Volt will be expensive, unprofitable, and unpolished. Or, to use a PR term, “belt and suspenders.”

But don’t worry, there’s more. But hell, this Bob Lutz we’re talking about… you knew there was more:

Gen two will have all these intelligent cost saving things built in. Ultimately there’s no question that we will make some money on the Volt.

On pricing, its going to be higher than people would normally expect to pay for a car of that size, but on the other hand there’s a federal credit of $7500. Many states are now talking about credits, some cities are talking about credits, and some employers are offering credits, like Google.

So that at the end of the day if somebody has a federal credit, a California credit or whatever state, a major urban credit, and she works for Google, she’ll wind up writing a five thousand dollar check and getting a Volt.

Can you see the ad now? “Do you have a job? Do you have five thousand dollars? Well, come on down to Maximum Bob’s House of Volts, where you don’t buy a car… the government does.” And, in typical GM fashion, though the marketing come-on has already been committed to memory, there are still a few things to work out. Specifically, the “some restrictions may apply” part.

Without committing to [a] ten year or 150,000 [battery] warranty basically we are very very confident in the capability and the life of this battery in all but the hottest climates. So it could be that in certain very hot climates where people leave this thing in a baking supermarket parking lot all day, these lithium ion batteries, if they get much over 95 or 100 degrees Fahrenheit, they quickly start losing life. So we may have to adjust warrantees, but we really haven’t decided how to do that yet.

Too bad GM didn’t have time to do its two years of “customer experience optimization” testing until after the Volt goes on sale in California. At least it never gets too hot in California, right? But, as Lutz himself told Newsweek back in December of 2007

If some Silicon Valley start-up can solve this equation, no one is going to tell me anymore that it’s unfeasible.

You know, eventually.

Get the latest TTAC e-Newsletter!

33 Comments on “Quote Of The Day: Maximum EVolution Edition...”


  • avatar
    Some Guy

    Bob doesn’t sugarcoat. He’s so interesting to listen to.

    As for the issue with baking the batteries in blazing hot sun shortening their lifespans, I’m sure that the Volt isn’t the ONLY electric car that is prone to this. At least with the Volt, you won’t be left stranded once the battery starts losing capacity (as long as you have a gallon or so of gas sloshing around in the tank) whereas with the Leaf, Nissan’s projected battery lifespan is half of what GM is predicting for their car, and once it’s drained, you’re stuck.

  • avatar
    gslippy

    He may as well have added that the extreme cold will kill the batteries also, as well as the economy they allegedly offer.

    The difference with the Volt and Leaf batteries is that I think the Volt has an active thermal management system for them, whereas the Leaf’s thermal management is passive. This could play in favor of the Leaf for the scenario that Maximum Bob describes.

    As for ‘unpolished’, the initial (limited) reviews have been positive, although those cars were carefully prepped for the audience.

    I don’t believe his claim about the potential $5000 price after multiple credits. I call foul.

    Anyway, the primary competition for the Volt is not the Leaf, but the Cruze, and a host of other small efficient cars.

  • avatar
    tparkit

    A few nuggets:

    “we inadvertently did some belt and suspenders stuff”

    – no doubt he meant “seat-of-the-pants” stuff.

    “So we may have to adjust warrantees, but we really haven’t decided how to do that yet.”

    – he really does mean “we”, paleface. With Washington standing behind him, he’s free to offer any warranty necessary to move the car.

    “…if somebody has a federal credit, a California credit or whatever state, a major urban credit, and she works for Google, she’ll wind up writing a five thousand dollar check…”

    – I’ll bet GM wants to thank you for that “she”, Bob. Yup, it’s a Chick Car. And you really ought to have extended your list of beneficiaries to include anyone who works for any level of government. They already make far more in salary and benefits than the rest of the population, and now they’ll get free runabouts.

  • avatar

    “belt and suspenders” = redundant systems

    All he’s saying is that to get the 1st gen Volt on the road, they’ve had to do some quick and dirty engineering, with possible redundancies that will be eliminated as they do more elegant work. Eliminating redundancies will save cost.

  • avatar
    FromBrazil

    Well glad that to us 3rd worlders hybrid tech is deemed too expensive and thus unavailable. Can you imagine the following scene in a Chevy dealership?

    Customer: “but you promised and advertized 100km free driving?!”
    GM dealer; “go blame it on the sun”

    Uhmm, could end up in court!

  • avatar
    Lexingtonian

    “no doubt he meant “seat-of-the-pants” stuff.”

    No, “belt and suspenders”, in (at least some forms of) engineering jargon is redundant engineering. He’s saying that it’s more expensive than it *needs* to be because they’ve been overcautious at various parts of the design, and future generations will be able to get around it. Reading between the lines, he’s saying that it’s going to have imperfections because they spent too much time in some areas, too.

    Just think “we worked too hard on it, that’s why it’s so expensive”.

    But anyway, refreshing to hear M.Bob saying pretty clearly to wait for the second generation and admit they don’t have a long-term solution for batteries.

    But with the low expected production of the first gen, I doubt it will hurt them all that much. The more I think about it, that part actually sounds smart about the Volt — they put a half-baked, overpriced yet desirable product out in limited numbers and lose money on it. If other companies compete seriously, economies of scale bring down the cost of external components. If there’s no serious competition, price competition isn’t as important.

  • avatar

    “So it could be that in certain very hot climates where people leave this thing in a baking supermarket parking lot all day, these lithium ion batteries, if they get much over 95 or 100 degrees Fahrenheit, they quickly start losing life. So we may have to adjust warrantees, but we really haven’t decided how to do that yet.”

    I see… and how hot does your average car get while sitting in a parking lot in July?

    Ah, Bobbo… thank you for letting your mouth run free, and speaking the truth. Even if it apparently implies your average office drone had better stay the hell away from the Volt, lest their government-supported buzzboxes wither in the all-day sun of pretty much anywhere in the US, save Alaska.

    What a “volt” of confidence! Sign me up for this train wreck!

  • avatar
    Paul Niedermeyer

    GM has all along been quite transparent about the Volt’s development, and made it clear that the short development schedule was going to require “belt and suspenders” solutions that they knew would be more efficiently solved in gen 2 and gen3.
    Ford’s and Benz’s first internal combustion cars left some room for improvement too.

    • 0 avatar

      I was discussing the oil platform explosion with my kids (all adults now). Most people don’t have a clue how engineering works or how products are designed and developed. My son, who now majors in math and physics started out in engineering, so I asked him, “How do engineers learn?” and he gave the right answer, “From failure”.

      Just think about how much more we know about (and can control) what goes on inside the combustion chamber of an ICE than we knew only 20 years ago. Right now, hybrids, EVs and PHEVs are at the Model T level of development. Give the engineers the reins and enough money and they’ll do amazing things.

  • avatar
    Samuel L. Bronkowitz

    So what he’s really saying is that GM did its usual half-assed job on the first edition of a new model and the poor suckers that buy it will be the beta testers.

    If this were old GM I wouldn’t give a rip, but now that it’s Government Motors it’s my money they are blowing and I’m not happy about it.

    • 0 avatar
      dwford

      Sadly, this is exactly the same as the old GM. They never want to take the incremental steps to greatness, but instead always try for the moonshot that invariably comes up short. We can’t just get a better Prius from GM, no we have to have the Volt. We can just have a regular minivan, no first we have to have the Lumina/Transport space ship, then the too small Venture/Montana, then the uglified wanna be SUV Uplander. We can’t just have the best Camry/Accord they can build, no we have to have 4-5-6 mediocre sedans all built on the same platform from several different brands all costing the same. Why is the Malibu a 1/2 size too small?

      I think GM knows it can’t compete heads up in any category, so it tries and tries to come up with something that can’t quite be pigeon holed into the established category, and fails every time.

  • avatar
    Mister Sparkle

    As an engineer who designs non-automotive things, I think the “belt and suspenders” comment is quite reasonable and not a sign of half-assitude. If you are designing something new and going beyond the limits in which anyone has previously operated, calculation, simulation, and prototype testing will only take you so far. In this setting, it is quite reasonable to jack up your factors of safety in recognition of the unknown potential for problems. Experience provides knowledge on how theory and real-world performance are agreeing. As you become more able to predict how things will behave, you can start making your designs more efficient without sacrificing reliability or performance. This is the art of engineering, with apologies to Audi’s ad agency.

    An example from another era of this tendency can be seen in the design of suspension bridges. If you look at the Brooklyn Bridge and the other suspension bridges of the late 19th century, they have a very deep, very stiff deck because the designers of the era did not exactly know how stiff the deck should be and the theory to calculate it was in its early stages. But, they knew it was important. So, they made them very stiff to make sure the design would function safely. This created excess weight and cost, and limited the span length.

    Fast forward about 50 years to the Golden Gate bridge, and the engineers had roughly tripled the span of the Brooklyn and the length/stiffness ratio was much higher, although still relatively conservative. The designers were able to use 50 years of experience and advances in design theory to create a much more efficient structure. Does this mean the Brooklyn Bridge was/is a pile of crap? No, it just means that Roebling used a belt-and-suspenders solution in the face of the unknown.

    Fast forward roughly another ten years to the Tacoma Narrows bridge. If you look at photos of that bridge, the deck is an extremely light and shallow structure compared to the Brooklyn and even the Golden Gate. The designer of the Tacoma Narrows was consciously trying to push back the boundaries on suspension bridge design and lightened the deck to an unprecedented degree in accordance with what the equations said would work. If you haven’t seen it, do a search and watch the video that showed how it worked out. (If you look at pictures of the replacement bridge, you can see that they used belt, suspenders, and two-sided tape. But, it’s still there.)

    The engineers at GM are doing the automotive equivalent of the Brooklyn Bridge while fearing they are going to be building a Galloping Gertie instead. It would be reckless of them to do anything but a belt and suspenders, ultraconservative design. The payoff is that they will know more than anyone else about range-extended EVs and, if they don’t squander their knowledge and just coast, could become the market leader. Of course, GM’s past history is not comforting in this regard, but I would hope that the abyss of bankruptcy and shame of a government bailout would be instructive. Additionally, early market leaders do not always prevail in the long term, as the Kaypro computer with CP/M operating system in my closet shows.

  • avatar
    RogerB34

    California debt is 57 percent of its 2010 budget. Paying for Volts not likely on the priority list. Arizona, Nevada, Illinois, New York, to New Jersey at 37 percent. States paying to defray Volt purchase is not likely. USA only 9.9 percent of 2009 GDP. Obama will welcome the opportunity to Stimulus.

    • 0 avatar

      Yeah, like what’s more important, energy efficient cars, or grossly overcompensated entitled and slothful public employees with guaranteed golden pensions?

    • 0 avatar
      Dr Lemming

      Ronnie Schreiber: I’ve been a public employee for 15 years. I work hard, get paid less than if I were in the private sector, and wouldn’t bet the farm that I’ll receive my promised pension.

      You’ve sidestepped the inconvenient fact that there are many different kinds of public and quasi-public employees. Federal agencies, states and local governments often deal with pay scales and pensions quite differently. Even within one unit of government you’ll find a multitude of agreements with whichever unions are involved (if any).

      But let’s not confuse the issue with actual facts.

  • avatar

    Not to change the subject (much), but was Maximum Bob’s pension bankruptcy proof or not?

    • 0 avatar
      Juniper

      Sorry you are jealous of people with pensions but you chose your career path and now you have to live with it.
      Same goes for Ronnie.

    • 0 avatar
      gslippy

      @Juniper:

      What’s with the venom? RF’s question is relevant if you’re a taxpayer. Unless it doesn’t bother you to feed pension money from your paycheck to M.Bob’s, regardless of his role in guiding GM toward bankruptcy during his illustrious career.

    • 0 avatar
      newcarscostalot

      What? You mean my taxes are finding their way into Maximum Bob’s already fat wallet?

    • 0 avatar
      Mike999

      You know, if you’re going to bring Politics into this Blog.

      Then, Why aren’t you Protesting outside the Walton Family’s Gated Community, for all the LOST JOBS SENT TO CHINA?!?

      These guys WORKED for their Pensions, They aren’t causing CA’s bankruptcy, You REPUBLICAN Crackpot’s are by sending US jobs to China.
      Here’s a clue: Chinese workers DON’T PAY US TAXES!!!

      You crackpots had better start learning that it’s the top 1/10 of 1 Percent of this country Destroying America. And 400 MILLION DOLLAR DumbA** Limbaugh is just their Rear End Kisser.

      Stop listening to Fox[ Saudi ] News And Start Fixing things.

    • 0 avatar

      Mike, Mike…

      I choose to spend money at Wal-Mart, because they offer a handful of cost-effective products that I use, and have been largely satisfied with.

      Back in 2006 I vowed to never own another GM product, or contribute in any way to that company, because it couldn’t meet those same criteria.

      Yet the feds insisted on taking my money to prop up Government Motors, the UAW… and, apparently, Bobbo’s fat ass.

      It really is as simple as that choice

    • 0 avatar
      gslippy

      @Mike999:

      If by the “top 1/10 of 1% of this country” you are referring to those who take risks, start businesses, hire people, offer job benefits, and get things done, then we must disagree.

      I don’t argue whether Bob Lutz earned his pension; RF’s question was whether it is contractually guaranteed with respect to the bankruptcy.

      As for “sending jobs to China”, every American consumer is responsible for that, including you. I’m a flag-waver, too, but I also want to pay competitive prices for products. The only way to NOT “send jobs to China” is to close off our economy from outside influence, which would make us look a lot like North Korea.

  • avatar
    KixStart

    Lutz: “By just doing some more elegant engineering than we did the first time around where we inadvertently did some belt and suspenders stuff because we wanted to move fast.”

    Fast? It will be very nearly 4 years from green light to revenue, on a previously developed platform. Is that fast?

  • avatar
    KixStart

    Lutz: “So it could be that in certain very hot climates where people leave this thing in a baking supermarket parking lot all day, these lithium ion batteries, if they get much over 95 or 100 degrees Fahrenheit, they quickly start losing life.”

    I hope he’s wrong about this… it sometimes reaches 100F here in Minnesota. I’ve encountered 105F in North Dakota. Degradation at those temperatures could be a serious problem across much of the US.

  • avatar
    John Horner

    There is an old engineering manager’s maxim which goes:

    “Cost, Quality, Time to Market: Pick Any Two”

    On the other subject, just what does he mean about “adjusting warranties”. Is GM going to deny warranty claims if they find out that the car spent some time in desert climates?

  • avatar
    newcarscostalot

    Lithium-ion batteries don’t like heat. High ambient temps. will hasten permanent capacity loss. Hopefully there will be a long no-hassle warranty. Realistically, I would imagine the batteries would hold up fine in normal everyday usage. Also, does anyone know what the projected life span of these batteries are under similar conditions? The Prius and Insight both use Nickel Metal Hydride.

  • avatar
    eastcoastcar

    Well, since I have an income of 150k/yr, I can certainly afford to buy a Volt AND pay for maintenance on its 1)gasoline engine and 2)electrical and 3)battery systems, so that I can drive 50 miles round trip to my job each day. And all will see me on the road and wish they were me, and that they too could waste their hard earned money on another crummy GM pre-beta test product. Meanwhile, I will try to hide the look of superiority on my face as I drive around town, especially on those ‘cruising Friday nights’ where I display my Volt and my stupidity to onlookers.

    • 0 avatar
      mcs

      4) Move to an urban neighborhood with nothing but on-street parking so your Volt never gets plugged in to recharge – at least until you can manager to locate a 2,500 foot extension cord.

  • avatar
    SherbornSean

    I learned 2 things this morning, both of which are good news.

    The first is that GM engineers are actually LEARNING. There really hasn’t been a lot of evidence of that the last 30 years, at least not at the pace of competitors.

    The second is that Farago lives.

  • avatar
    pleiter

    Lutz is an Executive that emits something like real information. Where the heck will the world ever fond a replacement for that?


Back to TopLeave a Reply

You must be logged in to post a comment.

Subscribe without commenting

Recent Comments

New Car Research

Get a Free Dealer Quote

Staff

  • Contributing Writers

  • Jack Baruth, United States
  • Brendan McAleer, Canada
  • Marcelo De Vasconcellos, Brazil
  • Vojta Dobes, Czech Republic
  • Matthias Gasnier, Australia
  • W. Christian 'Mental' Ward, Abu Dhabi
  • Mark Stevenson, Canada
  • Cameron Aubernon, United States
  • J Emerson, United States