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LG Chem has won the battery contract to produce battery cells for the Chevy Volt. The lithium power cells, developed by LG subsidiary Compact Power, are similar to the cells shown here. While the cells are made overseas, GM will manufacture the battery packs domestically in Michigan.  (Source: EV World)
GM makes big battery announcements at NAIAS 2009

GM finally resolved its battery quandary, announcing at the North American International Auto Show this week that it was selecting Korean battery maker LG Chem's batteries for the first generation of Chevy Volt.  The decision puts to rest months of uncertainty between LG Chem and its competitor for the contract, a team of A123Systems Inc. of Massachusetts and German auto supplier Continental (formerly part of Siemens).  LG Chem is teamed with its Troy, MI-based subsidiary, Compact Power, which helped design the cells.

While the cells will be produced overseas, the Volt's battery packs will be assembled in Michigan.  The batteries will likely be produced in a retooled midsize facility.  As automotive assembly tooling is not very applicable to manufacturing the packs, they will likely need a freshly tooled line.  The tooling cost to GM to achieve a volume of hundreds of thousands of packs could be $1B USD or more, according to a conversation DailyTech had with GM representatives.

GM's representatives said the decision to pick LG Chem over A123 was simple business, and that GM will continue to support A123's growth and development, calling the company a key business partner.  According to these representatives, the key reason why A123 was not selected was the company's inability to hit mass-production scales by GM's 2010 launch date for the Chevy Volt.

Bob Lutz, GM's vocal vice chairman, stated, "A123 is still sort of a startup, they're still ramping up, and A123 has been specializing mostly in ...cylindrical cells, which are good with power tools and stuff. What we need here is prismatic, which is flat cells. And LG Chem is just farther along."

He continues, "And this is one of the things why we say, if we're serious about the electrification of the automobile, as part of the national energy policy we do need government support for advanced battery development, which of course Japan has... LG Chem has massive support from the Korean government in terms of a whole research campus was paid for by the Korean government because Korea recognizes that advanced battery technology is a key component of the country's competitiveness."

Prabhakar Patil, Compact Power's CEO, had no harsh words for his company's competitor, stating, "It's a business decision.  Some people try to make it into an emotional issue but it really isn't. It's driven by the volume.  The bigger question is actually infrastructure. The labor content in the cell is relatively low. So as a result, there is flexibility. But in order to make that kind of an investment, not only for LG Chem but for suppliers for materials, etcetera, that's a significant level of investment and therefore you need to have enough of a business proposition, sustainable business, and of course infrastructure."

He comments that the U.S. currently does not have the infrastructure necessary to support internal cell production, but is moving toward such a manufacturing base.  He comments, "That's something that is evolving and I have to give state of Michigan a lot of credit for what they are trying to do to support that.  That's something we continue to evaluate and when the time is right we are open."

Competitor A123 currently manufactures its lithium ion battery cells in China, but it has applied for federal grant money to build a plant in southeast Michigan.  It hopes that bringing its production to the U.S. and building a large capacity will help it win a next generation Chevy Volt battery contract.

Ultimately, much of the jobs resulting from GM's final battery plan will be created in the U.S. as one of the most intensive parts of manufacturing battery stacks, is assembling cells, their cooling equipment, and other necessary equipment together into a finished product.



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Is it just me?
By Raidin on 1/13/2009 6:04:04 PM , Rating: 5
Does anyone else wonder why one of the two battery manufacturers is simply called A123Systems, Inc.?

- "So what do we name our new company?"
- "Oh I dunno, how about BattTek?"
- "No, that makes us sound like we manufacture Batman's entire line of equipment."
- "Well, I'm out of ideas. How about we just call it A123... like my password."




RE: Is it just me?
By Motoman on 1/13/2009 6:08:59 PM , Rating: 2
...that's what I was thinking. Like "AAAA Bail Bonds"


RE: Is it just me?
By 67STANG on 1/13/2009 6:15:06 PM , Rating: 5
I had first heard of A123 Systems (http://www.a123systems.com/) on the discovery channel. Some show about future technologies... forget the title. Seems like they have a pretty good battery tech. Probaby lost the contract to the fact that they are a start-up.

Anyhow, according to the website:

A123Systems owes its name to the Hamaker force constant which is used to calculate the attractive and repulsive forces between particles at nano dimensions, and which begins “A123...”


RE: Is it just me?
By Raidin on 1/13/2009 6:27:31 PM , Rating: 3
Ah, so that's it. Thank you. Good to know there really is a good reason behind the name.

Still like my explanation better, though.


RE: Is it just me?
By RamboZZo on 1/14/2009 4:58:27 PM , Rating: 2
If you work with power tools A123 is pretty well known. They were one of the first manufacturers to achieve lithium ion cells capable of high current discharge without blowing up. They've had an exclusive contract to supply DeWalt li-ion cordless power tools for years. They make the best li-ion cells for high current applications.


RE: Is it just me?
By codeThug on 1/13/2009 6:32:08 PM , Rating: 3
The absolute worst company name in existence:

http://www.infragistics.com/


RE: Is it just me?
By creathir on 1/13/2009 7:06:47 PM , Rating: 3
I actually think A123 is worse, though the explanation above at least makes it somewhat better...

What is wrong with Infragistics exactly? No worse than ComponentOne...

How about Adobe Systems? Or Macromedia?

*cough* Google *cough* (Which comes no where near explaing what it does, how it opperates, or anything regarding anything other than a semi reference to a very large number...)

Names are names. I do personally prefer when they are more creative than A123 or AAAA Bail Bonds (this is done by the way, so their name is first in the yellow pages... quite stupid if you ask me...) but a name is still a name.

- Creathir


RE: Is it just me?
By ebakke on 1/13/2009 11:15:55 PM , Rating: 2
quote:
*cough* Google *cough* (Which comes no where near explaing what it does, how it opperates, or anything regarding anything other than a semi reference to a very large number...)
Which is amusing, since their whole goal was to provide us with relevant results, not a large quantity of results.


RE: Is it just me?
By exanimas on 1/13/2009 11:58:11 PM , Rating: 3
They should've named it something cutting edge, like Cut Corp., or Edge Co. I know, Flancrest Enterprises! Doh.


RE: Is it just me?
By ianweck on 1/14/2009 6:06:16 PM , Rating: 2
Or Kramerica for you Seinfeld fans.

http://kramerica.tv/


RE: Is it just me?
By Torched on 1/14/2009 10:37:10 AM , Rating: 2
Reminds me of how Microsoft was named. Bill Gates wanted the name to sound harmless so he picked a name that is small and squishy. Har.


RE: Is it just me?
By 67STANG on 1/13/2009 7:18:22 PM , Rating: 2
Hey now... I actually use their WPF suite for application development. It's not half bad... Not as good as Telerik's stuff, but still not bad.


RE: Is it just me?
By FuzionMonkey on 1/14/2009 1:24:44 AM , Rating: 2
RE: Is it just me?
By MrPoletski on 1/14/2009 4:20:06 AM , Rating: 2
www.therapistfinder.com


RE: Is it just me?
By matt0401 on 1/14/2009 9:54:54 PM , Rating: 2
After having been warmed up by "Analtech", this one made me truly LOL.


RE: Is it just me?
By Kenny1234 on 1/13/2009 6:48:48 PM , Rating: 1
a123 is a type of battery cell


RE: Is it just me?
By foolsgambit11 on 1/13/2009 7:01:24 PM , Rating: 3
Yeah, there's double a, triple a, 123 a....


RE: Is it just me?
By Fenixgoon on 1/13/2009 9:51:37 PM , Rating: 5
well they could be 12345. that's the same combination i have on my luggage!


RE: Is it just me?
By ebakke on 1/13/2009 11:17:12 PM , Rating: 3
Do those seriously stop anyone? Why do they even include them why you buy the luggage? You could break the dang thing with a spoon.


RE: Is it just me?
By 67STANG on 1/13/2009 11:33:24 PM , Rating: 2
If I hadn't already posted, I'd give you +1 for the vague Spaceballs reference.


RE: Is it just me?
By therealnickdanger on 1/14/2009 8:06:43 AM , Rating: 1
She's gone from "suck" to "blow"!


RE: Is it just me?
By MrPoletski on 1/14/2009 4:19:08 AM , Rating: 2
quote:
- "No, that makes us sound like we manufacture Batman's entire line of equipment."


That's a bad thing?


Sad
By InternetGeek on 1/13/2009 6:10:28 PM , Rating: 2
quote:
He comments that the U.S. currently does not have the infrastructure necessary to support internal cell production, but is moving toward such a manufacturing base.


I wonder if this is just an odd case, or a reflection of the state of many industries in the US?




RE: Sad
By mdogs444 on 1/13/2009 6:28:14 PM , Rating: 3
Its most likely the reflection of many, if not all of them. Its not that they can't build plants to manufacture this stuff, the problem is that the labor costs are so high that they'd need be able to keep the costs down.


RE: Sad
By foolsgambit11 on 1/13/2009 7:04:19 PM , Rating: 4
Or, put another way, it's not that they can't build the plants, it's just that cheapass Americans won't pay a premium for American products, nor will they work in sweatshops to ensure competitive product pricing.


RE: Sad
By mdogs444 on 1/13/2009 7:19:53 PM , Rating: 1
Considering that these "cheapass Americans" who could afford these products are already paying 25%+ in federal income taxes to support, above all things, entitlement programs - why exactly would they want to pay MORE money out of pocket to support these types of products when the workers at these plants are getting $60+/hr to sweet floors?

quote:
nor will they work in sweatshops to ensure competitive product pricing

Ahh yes. Damn that industrial revolution that helped increase the standard of living for everyone in the United States. How dare those Americans refuse to be slave labor so you can afford a better car while not working as hard!


RE: Sad
By foolsgambit11 on 1/14/2009 4:45:32 PM , Rating: 1
quote:
Considering that these "cheapass Americans" who could afford these products are already paying 25%+ in federal income taxes to support, above all things, entitlement programs - why exactly would they want to pay MORE money out of pocket to support these types of products when the workers at these plants are getting $60+/hr to sweet floors?
I never claimed to have an answer. I was just pointing out that the problem can be viewed from multiple angles. Yet another angle to view the problem from could be to blame the government. But not how you'd like to blame it. You could blame the government's free trade policy. Without free trade agreements, we could place import duties on foreign products so that products from Korea or Singapore cost the same as similar products made in America. That was the old way of doing things, and it 'worked'. (I personally like the idea of free trade - but I also like the idea of the free movement of labor.)

By the way, workers don't get $60/hr to sweep floors; you're misunderstanding labor costs versus wages. But, anyway, I would say the problem with the U.S. tax structure isn't the percent of income spent on taxes, but rather the lack of benefits generated by those expenditures.

The cost-benefit analysis would be perceived as much better, for instance, if we moved to a nationalized health care system. We're currently all paying for health insurance for the most expensive people to care for. The addition of the millions of healthy people in America to a national health care program would decrease average costs per person, and would give everybody a sense of getting something for the money they put in. And it wouldn't cost that much more - the additional taxes would be less than current insurance costs.

Additional cost savings in government could be achieved by cutting Defense's budget by 25%, with the possibility of further cuts. The total military defense budget for 2009 is roughly $650 billion - plus the costs of Iraq and Afghanistan. The average individual (or married filing jointly), assuming all savings went to their taxes, would get a $1000 (or $2000 if married filing jointly) tax rebate every year from a 25% cut in defense spending. That's twice the stimulus proposed in Obama's one-time stimulus package.

We could increase sales tax and excise taxes (consumption taxes) in place of income taxes - this would ensure that the tax burden was more equitable, since it was based on how much you spend. Excise taxes could also decrease the relative difference between foreign and domestic product prices (a $25,000 US-made car costs 25% more than a $20,000 foreign car, let's say. If you put a $5000 excise tax on both, then the $30,000 US car is only 20% more than the $25,000 foreign one.) The down side is that consumption taxes have negative economic effects, by discouraging consumer spending.

quote:
Damn that industrial revolution that helped increase the standard of living for everyone in the United States. How dare those Americans refuse to be slave labor so you can afford a better car while not working as hard!
I think you may have forgotten your history. The industrial revolution didn't do much to increase the standard of living for everyone in the United States. Unionization did that. That same unionization you curse in your first paragraph. I'm not saying unions are perfect (far from it), but they have done a lot of good when it comes to raising workers' compensation standards.


RE: Sad
By Spuke on 1/14/2009 5:08:27 PM , Rating: 2
quote:
but they have done a lot of good when it comes to raising workers' compensation standards in the past .
Fixed that for you.


RE: Sad
By Alexvrb on 1/14/2009 11:05:15 PM , Rating: 2
quote:
The addition of the millions of healthy people in America to a national health care program would decrease average costs per person
Yeah lets shift the costs onto the healthy working citizens. Not to mention every time little Timmy gets a sniffle, he's off to the doctor at everyone's expense. Why not? It's already paid for. It's like having all phone plans come with mandatory unlimited minutes. Might as well use em. Not to mention that fact that you seem to think putting control of ANYTHING into the hands of the government is going to decrease costs. That's interesting. Say, I've got a bridge for sale...

quote:
and would give everybody a sense of getting something for the money they put in.
Yeah right. Just like all the other programs we benefit from, which are paid for with our tax money. Give it a while, and most people will take this for granted too. It would be yet another entitlement.


RE: Sad
By ebakke on 1/13/2009 11:20:58 PM , Rating: 2
quote:
it's just that cheapass Americans won't pay a premium for American products
Call me a cheapass all you want, but I'm only willing to pay a premium for a better product. Where it was produced is irrelevant to me.
quote:
nor will they work in sweatshops to ensure competitive product pricing
For whatever it's worth, we'd also get "competitive pricing" (albeit, at a higher net price) if citizens of other nations refused to work in sweatshops as well.


RE: Sad
By rudolphna on 1/14/2009 9:14:07 AM , Rating: 2
I hope your looking forward to the US as a 3rd world country because noone has jobs, as everything has been relocated overseas.


RE: Sad
By ebakke on 1/14/2009 12:24:24 PM , Rating: 2
I tell you what. If you're right, you can freely say "I told you so!"

Until then, I'll keep living my life knowing that the sky isn't falling, and I'll still have my job tomorrow.


RE: Sad
By Spuke on 1/14/2009 12:34:13 PM , Rating: 3
No one, huh? LOL! 92.8% of the participating workforce is working (7.2% unemployment). Hardly, a "noone has jobs" situation.


RE: Sad
By rudolphna on 1/14/2009 7:15:05 PM , Rating: 1
Right now. What happens when They computerize stores, so everything is done by computer. No need for people, except maybe security and to clean up. Airplanes will likely be one day completely computerized, since with sufficient redundancies, they would probably be much safer than human operated craft. Also, that would allow computers in ATC so no need for human controllers except a few to oversee to make sure there are no problems. This is nowhere in the near future, but if things keep going the way they are, it will eventually happen. Maybe.


RE: Sad
By ebakke on 1/15/2009 4:57:31 PM , Rating: 2
Who's going to build all of these computers? Who's going to write the software? Who's going to update it? Install it? Fix it?

Who's going to improve it, and develop the next greatest thing?

Oh... yeah... humans.


RE: Sad
By Wierdo on 1/14/2009 12:54:22 PM , Rating: 2
Well look at the bright side... if that happens then Mdog444's complaint about "Americans not working in sweatshops" will be addressed :/


Why not two suppliers
By CardPuncher on 1/13/2009 7:09:54 PM , Rating: 2
Why be beholden to just one supplier, seems like you would want two or more not only for competition, but in case one company gets wiped out by an asteroid, or more likely has a disruption in meeting demand due to a labor strike.




RE: Why not two suppliers
By meatless on 1/13/2009 8:30:41 PM , Rating: 2
Because they make different types of cells, so the battery packs would not be the same, and they will engineer the Volt to a specific pack?

Because if an asteroid wipes out korea, we have bigger problems than the batteries of korea?

Because they probably won't have a labor strike in korea? :P


RE: Why not two suppliers
By Spuke on 1/14/2009 12:35:50 PM , Rating: 2
30k Volts per year. Don't really need two suppliers.


RE: Why not two suppliers
By ianweck on 1/14/2009 6:03:49 PM , Rating: 2
60K first year, 100k the next. I forget where I read that now. You're right though, hardly worth the effort of getting two suppliers on the same page regarding specs. I wouldn't be surprised if the gen2 has two or more suppliers though, if it ever gets produced.


RE: Why not two suppliers
By Spuke on 1/14/2009 6:54:11 PM , Rating: 2
Oh, they upped the production? Hmmm. Interesting. Speculation alert!!!! I wonder if GM did that because the truck market imploded? Anyone know what GM's expected profit is on the Volt?

Answered my own question. It seems GM is NOT expecting a profit on the Volt unless the batteries last longer than expected.

http://tinyurl.com/7cfwbr

They don't expect a profit until 2016 when the 2nd gen is in production.

http://tinyurl.com/85rs6u


RE: Why not two suppliers
By ianweck on 1/15/2009 2:33:15 PM , Rating: 2
Here's some info on how GM hopes to make up for the loss on each Volt sold, looks like profits might hinge on whether or not the concept Converj gets produced:

http://gm-volt.com/2009/01/15/video-exclusive-gm-v...

"Lutz said he does feel Volts wouldn’t sell as well if gas stayed at $1.50 per gallon, and that at first they won’t make GM a profit.
He said the Converj would cost only slightly more than the Volt to build but yet could be sold at double the price and actually make money for GM, and that’s one of the reasons why he said he’s so enthusiastic about bringing the Converj to production."

BTW this is the site where I read about the production numbers, just don't have time to dig for the article right now.


RE: Why not two suppliers
By Spuke on 1/15/2009 4:08:13 PM , Rating: 2
quote:
BTW this is the site where I read about the production numbers, just don't have time to dig for the article right now.
No problem. That's very much for that info. I'll pay more attention to that site.


This seems stupid
By rudy on 1/14/2009 1:49:31 PM , Rating: 2
The high cost of US labor is the main problem companies whine about yet they decide to produce the battery over seas then bring it to the US for assembly which will probably be manual labor intensive? This sounds like another political fiasco like the Air Bus A380 where efficiency is sacrificed to try to keep a bunch of politicians happy, and tons of money is made, just give up the Koreans have you beat hands down for batteries let them make the whole thing and wait till someone can compete here. In the end GM will go down. They just can't win.




RE: This seems stupid
By ianweck on 1/14/2009 5:59:08 PM , Rating: 2
GM probably plans on having the cells produced in the US too at some point. If that's true then it would make sense to have people around who are already used to putting the packs together. Does seem a little counterintuitive though.


Japan != Korea
By the goat on 1/14/2009 4:07:45 PM , Rating: 2
quote:
as part of the national energy policy we do need government support for advanced battery development, which of course Japan has... LG Chem has massive support from the Korean government


Last time I checked Japan and Korea are separate countries.




RE: Japan != Korea
By ianweck on 1/14/2009 5:53:01 PM , Rating: 2
I think his point is, that we're in competition with Japan WRT electric automobiles. Apparently Japan gets support from their government for battery research, and so does LG Chem from their government, Korea.


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