Plug In America suggests reducing warranty time to lower cost of Chevy Volt
Click above for a high res gallery of the 2011 Chevy Volt
One of the Obama Auto Task Force's findings RE the Chevy Volt was that it will be a wee bit pricey, too pricey, in fact to play a role in saving GM from itself. Plug In America (PIA), the advocacy group for vehicles with a cord, is trying to make the case that part of the problem for the Volt's expected high cost (GM hasn't given any official price estimate, but there's a general agreement that $40,000 is a reasonable expectation) is a California law that requires batteries to be waranteed for 10 years. To try an reach this goal, GM is putting in a 16 kWh lithium-ion battery pack, but only expects 8 kWh to ever be used. GM engineers have expressed nothing but confidence that their battery will work, but everyone knows it will be expensive.
PIA's solution: allow an exception to the California law for this new technology, say a five year warranty instead of 10, and let the automakers phase in the decade-long deal. Reduced warranty time could mean a smaller, cheaper battery and, presto, a cheaper Volt. As PIA's Paul Scott writes, "In order to comply with a stringent 10 year warranty, we have to buy twice the battery we need. This is an example of perfection being the enemy of the good. [...] Getting EVs on the road is more important than waiting till they are perfect."
PIA's official statement is available after the jump.
[Source: PIA]
PRESS RELEASE:
Plug In America Refutes Obama Auto Task Force Conclusion on GM Volt
Advocacy Group Proposes Plan to Make Car More Affordable
In response to an Obama Administration auto task force report, Plug In America on Tuesday proposed a plan to make GM's Chevy Volt and other plug-in cars more affordable, noting that most advanced new technologies are initially more costly.
California law requires that the Volt and other plug-in hybrids come with a 10-year warranty. To ensure this longer life, automakers are as much as doubling the size of the battery pack, increasing cost to manufacturer and consumer. But not a single production plug-in electric vehicle sold to date, from GM's early EV1 to today's Tesla, has had a warranty of more than five years, noted Plug In America advisory board member Chelsea Sexton.
"To support early deployment, California should relax the warranty requirement for cars like the Volt to five years, phasing to 10 years over time," said Sexton, a former GM employee. "This alone could cut the number of batteries required by as much as half and reduce the cost of each vehicle by thousands of dollars."
The warranty reduction would not impose added liability on GM or consumers, Sexton noted, because President Obama has said the federal government will guarantee the warranties of GM and Chrysler vehicles should they go bankrupt. And dealers can sell extended warranties, providing additional security for consumers who want it as well as revenue when auto companies need it most.
"The minimum Volt warranty we're asking for has historically been the maximum ever given for any plug-in car," Sexton said.
Plug In America's legislative director Jay Friedland further noted that the existing $7,500 tax credit for plug-in vehicles would further reduce the Volt's cost. Moreover, several states are implementing additional tax credits of up to $5,000 per vehicle.
"These incentives reduce costs for consumers and will increase sales, helping auto manufacturers reach economies of scale sooner," Friedland said.
Said Sexton: "We applaud the Obama Administration for its robust support for plug-in vehicle technology. But, this discouraging statement about the Volt's early viability is counter-productive to the President's own goal of 1 million plug-in vehicles by 2015.
"It is unreasonable to expect the Volt and any similar new technology to be immediately profitable when others that similarly started with a price premium, such as the Toyota Prius, became wild successes. Even the first DVD player costs many times more than it does today."
About Plug In America: Plug In America leads the plug-in vehicle movement. The nonprofit organization works to accelerate the shift to plug-in vehicles powered by clean, affordable, domestic electricity to reduce our nation's dependence on petroleum and improve the global environment. For more information: http://www.pluginamerica.org.
Reader Comments (Page 1 of 1)
ronEbear 3:05PM (4/02/2009)
With 10 year warranties being the norm these days, who the eff will want to settle for anything less?
10 year warranty: Awesome, the manufacturer guarantees me that my costly purchase will last me at least 10 years.
5 year warranty: So...the manufacturer guarantees me, although at a slightly lower cost, that my costly purchase will last me just 5 years?
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MT 3:44PM (4/02/2009)
I don't buy it. You never fully discharge batteries if you want them to last any length of time. Therefore you limit DOD to say 50% of the total battery capacity. If you half the size of the battery pack in the Volt, there's no way the Engineers would leave the EV only range where it is. They'd dial that back to ensure the batteries easily last 5 years. Now you have a shorter warranty and shorter range. There might be some wiggle room in there, but I don't think there's any way you 1/2 the pack size, keep the 40-mile range, AND expect the batteries to reliably last 5 years. This is the kind of stupid stuff that happens when the marketing and finance people start telling the Engineers what to do.
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Nick 3:48PM (4/02/2009)
Since Americans keep their cars for 4 years on average, this makes perfectly sense. Furthermore, since the batteries are already expected to last 10 years, no first time buyer will need to worry.
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paulwesterberg 7:35PM (4/02/2009)
I always keep my vehicles more than 4 years. I don't like car payments, I'm weird like that.
Chris M 3:51PM (4/02/2009)
The government shouldn't be setting the terms of the warranty, only requiring that the warranty be clear and unambiguous, and that the manufacturer make provisions to honor the terms of the warranty. That way, teh manufacturer can determine what a reasonable warranty is, and they can compete for "best warranty".
I suspect that "10 year warranty" requirement came about with good intentions, requiring emission controls on cars to be warranted for 10 years may have seemed like a good idea at the time. But batteries for EVs and hybrids were then considered "emissions controls" and the warranty rules applied to them also, putting up an extra barrier to plug-ins.
The law of unintended consequences strikes again.
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Nixon 4:28PM (4/02/2009)
The law of unintended consequences for 5-year batteries would be the failure of electric cars. The 10 year requirement must be kept, or this whole enterprise will end up being a silly 5-year fad.
When new car buyers are done with their typical 4 years owning a car, they expect to have a decent resell value. If the perception in the market is that a 4-year old BEV is just months from being nearly worthless, there will be no resell value left in these cars (even if that perception is wrong).
When new car buyers find out that their car has no resell value after 4 years, they will never buy a new one again. Thus the unintended consequences of 5-year batteries ends up killing BEV's for at least one whole generation of new car buyers.
Taking care of the second buyer is part of taking care of the first buyer. The exemption is a horribly short-sighted move that will destroy the used-BEV market that is an essential part of continued new-BEV sales.
The law of unintended consequences strikes again.
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sidewinder 10:10PM (4/02/2009)
I believe the article on Ford hybrid taxis indicated that those batteries lasted some 300,000 miles. Perception means a lot, that is true, but the evidence looks good even without the warranty.
Richard in FLA 5:24PM (4/02/2009)
I want to know why these batteries need to be replaced if they malfunction. Why can't they be remanufactured or the bad cells be fixed like the auto parts stores do? If bad batteries come in, they test the bad cells and replace/fix them and resell them. IF your Volt has issues with the batteries, the bad cells would be fixed or replaced. This would cost much less than completely replace the whole battery pack.. Am I the only one thinking of this? Maybe because I don't believe in a disposable society and disposable products, but this should have been the first question asked by the Obamamites!
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feaf 3:50AM (4/03/2009)
stop the volt and produce 100000 ev1 then they'll turn a profit in 2 years time.
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Chad 3:19PM (4/03/2009)
ev1's would have to be redesigned to meet up-to-date safety standards, including more airbags, increased reinforcement, stability control, etc.
Anth 5:57PM (4/02/2009)
Who knows what will happen with batteries by 2016 or 2021. By 2016, Volt 16kWh batteries could be replaced with better formulated batteries that are 12kWh (due to higher cycle count), smaller and cheaper. By 2021 the "T" shaped battery could be only the top of the T in size and 10kWh.
Warranties on this are tough because we don't know how quickly or slowly we'll progress on battery technology and what the costs will be. With a 10 year warranty the consumer knows they're protected for a long while.
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Phaedrus 6:53PM (4/02/2009)
Won't putting in a smaller battery reduce the amount of money you get from the government? The Volt barely qualifies for the $7,500 incentive...
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Way2trivial 8:28PM (4/02/2009)
Here's an idea. Don't offer the car in California.
Don't kowtow to that one states requirement.
Tell california to go duck themselves.
When the car is available to everyone else, then the law should end up being changed at the request of the state residents.
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gorr 9:22PM (4/02/2009)
It's not only the warranty the problem, it's the not uniform performance and inpredictability of the gas pedal that can cause easily an accidents not to mention the renegerative breaking that can works bad when the battery is full because the electricity cannot be stored. The battery will kill itself in the real world with real drivers. the experimentations done by gm is worthless. Consumers will drive in all sort of conditions, even below freezing where the battery and regenerative breaking will cause accidents because of the malfonctions.
This is a car proposed by big-oil and politicians to continue collecting taxes on gasoline and electricity made from nuclear, natural gas and coal.
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Dan 9:26PM (4/02/2009)
It's not really clear in the article or the statement, but the mandatory 10 year warranty is for emission control equipment, not the powertrain. A few manufacturers offer a 10 year powertrain warranty, but that has nothing to do with California regulation.
I think the logic is that if the battery fails, the engine will run more and then increasing emissions. Most of a new car's pollution comes from a cold start, so reduced battery capacity and more cold starts will definitely make a difference in pollution. Still, I agree it's a case of perfect air quality being the enemy of the good (efficiency, getting off oil).
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Paul 9:57PM (4/02/2009)
The 10 year - 150,000 mile warranty for EVs is unreasonable.... the sort of requirement only a public servant who is Anti EV would come up with. For an ICE car that is effectively a lifetime warranty.. and we all know ICEs don't last that long without something major falling off them.
The standard warranty for 'other' products is 1 year and the legal minimum is 3 months to be classified as merchantable. The battery in your laptop doesn't last 10 years and the routine life for a sealed lead acid battery can be as little as 12 months... there's no law saying either of those batteries have to last 10 years!! So making it law for untested EV batteries to last 10 years or your money back really is a tall order... I can't think of a single other product with that requirement.
The thing is, they won't fail at the 10 year mark anyways just because the warranty runs out, but we will only find out how long they DO last after a decade+. With the current pace of battery development increasing power density by 8% annually the batteries in a volt will be outdated within less than 5 years and due to mass production the replacement cost will be less than 50% of the current price by then.
The good news is.. with the much reduced heat stress of an electric motor, they routinely last over 20,000 hours and up top 100,000 hours is possible... all without any servicing. That's between 1.2 and 6 MILLION kms expected vehicle service life... another dimension compared to anything powered by an ICE.
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galant14b 8:05AM (4/03/2009)
"The 10 year - 150,000 mile warranty for EVs is unreasonable.... the sort of requirement only a public servant who is Anti EV would come up with. For an ICE car that is effectively a lifetime warranty.. and we all know ICEs don't last that long without something major falling off them."
I recently sold two Miata's....one of them with 164k, the other with 149k....Aside from regular maintenance, I put a new coil pack and a coolant temp sensor on one car, and both cars got a new set of shocks. Friend of mine had a 1986 Honda CRX up until last year that had 275k on it when he sold it with nothing but a replacement clutch and regular maintenance. Same with a '96 Mitsu Galant I got when I was 16...Donated it to charity at 192k...alternator, clutch, one suspension bushing that decided to self-destruct for a still unknown reason.
Your 'theory' that ICE cars can't last over 150k without falling apart tells me you've likely driven nothing but American made crap. If everyone used their buying power to purchase well-made vehicles, rather than 'throw-away' junk that the Big 3 has been spewing for decades now, perhaps requiring a 10 year warranty on powertrain bits wouldn't seem so outlandish to you....it certainly doesn't to me.
baetens willy 6:54AM (4/05/2009)
GM works together with tesla built the S end puth drivetrain in the volt problems over for both ,do it fast, green world fan belgium
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