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Lithium Economics
The
Obama Audit Task Force and the Volt
Apr 18, 2009
In several articles
published over the last year and a half or so both in Bolivia and the United
States I have advocated GM‘s Volt as a technological innovation that would
revolutionize the global car industry. So, on March 30 2009 I was astonished by
the main conclusion of the Obama
Audit Task Force (OATF) regarding the Volt:
“GM is at least one
generation behind Toyota on advanced, “green” powertrain development. In an
attempt to leapfrog Toyota, GM has devoted significant resources to the Chevy
Volt.”
This conclusion only
reflects the OATF´s failure to understand what advanced “green” car technology
really means.
In a recent
blog I
have argued that by relying on (obsolete but still commercially viable)
nickel-metal hydride batteries for their conventional hybrids, both Toyota and
Honda have been following a similar but rather cautious and conservative
approach to a lithium-based transition to electric propulsion in the global car
industry.
This entirely rational
behavior not only comes down to a different business strategy than that of
their main competitor: General Motors (GM); it also implies their lagging
behind GM insofar as electric automobile technology.
In fact, while
conventional hybrids have played
a big role in
raising driver´s consciousness over the last ten years or so, everybody now
agrees that Plug-in Hybrid Electric Vehicles (PHEVs), Range Extended Electric
Vehicles (REEVs) and Battery Electric Vehicles (BEVs) are the obvious steps
forward. Something all these new EV technologies share in common is their
dependence on lithium.
Both Toyota and Honda
know that for sure; that is precisely why they are now investing a great deal
in lithium. But given the critical situation of the American motor giant, it
simply does not (and did not) make any sense for them to become GM´s technology
followers or even leapfroggers.
Had they decided to
become followers or leapfroggers of GM, they would have had to lose part of
what they seem to value the most nowadays: their reputation. One just needs to
remember that at the time GM made its Volt announcement, it was already facing
severe financial problems, and Toyota and Honda were still the second and third
largest auto makers of the world (As of today, Toyota is first and Honda
remains third).
It was then probably
wise for Toyota to stick – at least for the time being - with its much proven
and praised Prius technology and let other car makers undergo the painful
“trial and error” process of the new way of doing things. One must keep in mind
also that to leapfrog GM, Toyota first would have had to kill the Prius.
In a similar vein, it
also made sense for Honda to be inclined towards a two-step approach to
electrification: first, emulate the know-how (i.e. the Prius technology)
advanced by a much more respected firm (Toyota) than GM and, second, come up
with something revolutionary, something beyond lithium; the hydrogen-powered
FCX Clarity model, for instance.
Of course, one should
not be surprised if, also as part of their business strategy, sometime down the
line both Toyota and Honda introduce some sort of lithium-powered electric cars
into the market. As I have recently commented on Seeking Alpha, however, this may
occur only at the expense of a technological lag.
Hence the OATF in its
recent March 2009 report did not appear to have a clue in terms of what
advanced “green” car technology really means. Perhaps some consumers in the US and
the UK
government could
have provided the Task Force with some valuable hints in this regard.
Times Article Viewed: 4608
Note.- This is a republication of a blog originally published on EVWorld.com on April 18, 2009.
