GM and LG jointly to develop EVs; expanding corporate partnership in multiple areas
25 August 2011
General Motors and LG Group will jointly design and engineer future electric vehicles, expanding a relationship built on LG’s work as the battery cell supplier for the Chevrolet Volt and Opel Ampera extended-range EVs. The definitive agreement signed Wednesday will help GM expand the number and types of electric vehicles it makes and sells by using LG’s proven expertise in batteries and other systems.
For LG, the arrangement represents a widening of its portfolio as an automotive solution provider. LG has a number of subcompanies with technology and products beyond batteries, power electronics and electric machines that might be of interest in vehicles, said Micky Bly, GM executive director, electrical systems, hybrids, electric vehicles and batteries. A short list includes instrument clusters, telematics inside the vehicle (LG supplies OnStar modules), heat exchangers, and air conditioning systems.
|“This is a strategic development for LG and we fully support GM’s goal to lead the industry in the electrification of the automobile.”|
|—Juno Cho, president and COO, LG Corp.|
Teams of LG and GM engineers will work together on key components, as well as vehicle structures and architectures. A formal structure for the engineering teams is not yet in place. Vehicles resulting from the partnership will be sold in many countries worldwide.
The GM-LG relationship that began with LG delivering the cells for the battery pack of the Chevrolet Volt and Opel Ampera expanded last year with work on a demonstration fleet of Chevrolet Cruze electric vehicles. (Earlier post.) The Cruze EV demo fleet will be powered by batteries (31 kWh pack) from LG Chem and propulsion systems (motor/inverter) from LG Electronics.
These vehicles were used as official vehicles of the G20 summit in Seoul are now in the phase of market-testing to learn more about capabilities and requirements.
The new GM-LG strategic relationship is much larger and broader than their current partnering on specific technology. As an example, in January, GM and LG licensed Argonne Lab’s layered-layered composite cathode material for Li-ion batteries, which promise a substantial increase in energy capacity and safety. (Earlier post.) Commercialization of that technology “is something that would have happened naturally,” Bly said.
This [new agreement] is much broader, much larger, and at a vehicle level. We are trying to bring an EV to the market together in the future. We are jointly designing at a vehicle level, and potential synergies and potential assets may be brought forward. If we have a great electric car solution, we may use it in many areas across vehicles.—Micky Bly
Timing of the launch of the first vehicles resulting from the partnership will be announced closer to market readiness. Although there is no firm timetable, Bly suggested that LG’s participation may help shorten the design, development and engineering process, however. The agreement does not involve an exchange of equity between the companies.
There's almost no limit to what LG can design and economically produce. LG could effectively reduce the R&D, design and mass production phases time for many parts and sub-assemblies used in future GM electrified vehicles.
What will happen to other local GM historical suppliers?
Posted by: HarveyD | 25 August 2011 at 09:43 AM
GM has a century of experience building cars. They know enough (we assume!) to second source all critical components - including battery cells and packs. Hence the recent deal with A123 Advanced Energy Storage Systems.
Interesting to see if they use the layered composite cathodes for the 31kWh Cruze pack.
Posted by: Reel$$ | 25 August 2011 at 10:05 AM
GM's suppliers (Lear Corporation, Johnson Controls, etc) are not solely dependent on GM for business - they produce products for numerous carmakers.
Posted by: ejj | 25 August 2011 at 10:45 AM
Is it a question of (lower) prices?
Posted by: HarveyD | 25 August 2011 at 11:50 AM
The only way for GM to maintain local vehicle production competitive may be to buy all parts, ancillaries and all sub-assemblies from Asia and put the finishing touch and the 'Final Assembly in USA' stamp locally.
Posted by: HarveyD | 25 August 2011 at 11:55 AM
Look what the production of the Chevy VOLT has created. A global EV company?
Posted by: Reel$$ | 25 August 2011 at 12:01 PM
Or a US car company with labor 80% outsourced.
Posted by: ToppaTom | 25 August 2011 at 07:56 PM
"Is it a question of (lower) prices?"
If it is NOT, then something is wrong.
Posted by: ToppaTom | 26 August 2011 at 06:01 AM
TT - at the moment only the battery pack is assembled in Korea. The rest of VOLT, (less some outsourced part) is assembled in Hamtramck MI. GM plans to assemble the cells and power control electronics in MI as well.
As for GM China, or India, or EU, yeah they employ locals to build the localized products.
Posted by: Reel$$ | 26 August 2011 at 09:38 AM
Eventually, every country will do and manufacture whatever they can do more efficiently. Free trade promotes competition.
One hundred years ago, USA could under price most other nations with mass produced goods.
For the last 50 years, many other nations have learned to do it cheaper and sometime better. Out went phones, TVs, PCs, batteries, cameras, clothing, shoes, car parts, cars, locomotives, trains, subways, trucks, heavy machinery, ships, etc.
Currently, agriculture-food industries, forestry and other primary products (with the exception of crude oil), software, engineering, aircraft, films, etc are still doing good but they do not create enough local jobs for a growing population.
To compete, USA may have to overhaul its tax system and switch from current Income tax based to selective Sales and registration based revenues. A well design system could reduce local manufacturing cost and make most imported goods more expensive. Secondly, the current unsustainable imbalance between low wage earners and people with increasingly very high revenues could be addressed at the same time.
Posted by: HarveyD | 26 August 2011 at 11:15 AM
By the way, Apple has managed to sell higher price gadgets and is having great success with their higher price, more innovation and high quality approach. Mercedes and BMW are also very successful with similar high price higher quality approach.
The right price is not always the lowest price. Cheap lemons had their days. Cheap junk foods will hit more resistance soon.
Higher quality electrified vehicles will sell even if the price is higher. The Toyota Prius HEV is a good example of what can be done. Their near future PHEVs and mid-term BEVs will also sell well, if the higher quality is maintained.
Posted by: HarveyD | 27 August 2011 at 10:31 AM
One of the reasons Toyota has taken an equity position with Tesla is the Tesla Model S. This car will compete with any other luxury car i.e. Lexus, Mercedes, Cadillac, etc. And will WOW the public with its attractive look and EV performance. The option to purchase one of 3 battery packs will make the Model S the most versatile EV on the road.
Posted by: Reel$$ | 27 August 2011 at 12:29 PM
"General Motors and LG Group will jointly design and engineer future electric vehicles, expanding a relationship built on LG’s work as the battery cell supplier for the Chevrolet Volt and Opel Ampera extended-range EVs."
"..General Motors will jointly design and engineer future electric vehicles with Ovonic Battery Co. in Michigan, expanding a relationship built on work as the battery cell supplier for the GM EV1 extended-range EVs.."
Posted by: kelly | 27 August 2011 at 04:18 PM
The Volt has a 54% US content, last time I checked.
Posted by: Herm | 27 August 2011 at 04:31 PM
Could this 54% be reduced to 20% (or less) if motors (ICE and Electric), batteries, transmissions, tires, wheels, seats, all parts, ancillaries, cabling, sub-assemblies etc were all imported thru worldwide bidding?
Automated local factories could do the final assembly and paint jobs.
Walmart, Costco, Target etc could do the distribution and service.
The selling price come probably be reduced to $30K or less.
Posted by: HarveyD | 28 August 2011 at 08:46 AM
We'd like to see the US content move to 65% over ten years. The UAW still holds sway with GM. And may soon hold a seat on the GM Board.
I wouldn't buy a car from Walmart or Target. But EVs require about 25% maintenance an ICE does - so it might be the cheapest way to go.
Posted by: Reel$$ | 28 August 2011 at 11:29 PM
GM may end up just doing chassis, painting and final assembly work in the US.. small electronic components lend themselves well to manufacture in the highly advanced factories of the east.
Posted by: Herm | 21 September 2011 at 04:57 PM
them to “explain” variables that have no material relationship to US ethanol production: the US price of natural gas and unemployment rates in the US and the European Union. Relationships by Precise Irrigation
Posted by: Edward Son | 07 December 2012 at 03:37 AM