GM’s China Dream Falters Because Of Bad Batteries

AUG 30 2018 BY DOMENICK YONEY 146

Chinese-built EVs not as easy as A123

General Motors has big plug-in plans for China with 10 models scheduled to launch in that country by the end of 2020. Now, though, it seems that plan has gone at least temporarily awry. The batteries that its in-country supplier A123 has been producing are not up to specification and can not be used as originally intended.

The first vehicle to have production impacted is the Buick Velite 6, a plug-in hybrid. Set to begin manufacture next month, it has now been pushed back with no revised timeline being yet made public. GM also currently makes the full-size Cadillac CT6 PHEV and the diminutive Baojun E100 in China. With, according to the Wall Street Journal, 22,000 copies sold, the tiny two-seater doesn’t seem to be affected and there have been no reports of production problems with the Caddy.

The setback underlines some of the difficulties faced by auto companies manufacturing in China. As many who have done business in the People’s Republic will tell you, it’s a great place to get things made, with low costs and high quality. But, if every step of the manufacturing process isn’t intensely scrutinized, shortcuts may get taken and corners cut. The result? Well, this sort of mess.

And it’s not like GM can now just turn to another supplier, say a Samsung SDI or a Toshiba. For one, it is obligated to use Chinese-made batteries in cars built in that country. It could also prove difficult, if not impossible, to find product with the exact specification needed sitting on a shelf or a producer with slack in its schedule to begin production any time soon.

Now, not only does GM have to scramble to get the proper battery for its Buick, but it also needs to redouble its quality control efforts at A123 and any other cell suppliers. If it doesn’t meet a certain quota of plug-in vehicles by the end of 2020, it may end up buying electric vehicle credits from other manufacturers who’ve managed to meet their production goals.

Source: Wall Street Journal

Categories: Chevrolet, China

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146 Comments on "GM’s China Dream Falters Because Of Bad Batteries"

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David Green

That rendering is a pretty good looking car, Is that the Chinese version of the Volt?/Bolt? or something all new?

Will

Volt

Doggydogworld

It’s a sketch of the Buick Velite 6 mentioned in the article.

Prsnep

How does a mere statement that the car looks good and a legitimate question get downvoted?

TomBrown

It’s not the statement and question but who it’s coming from. He’s a peculiar sort that seems to enjoy ruffling feathers in the Tesla related articles so it’s come to the point that anything he writes is downvoted. For the record I don’t like his tactics but don’t downvote him… I wonder if downvoting just fuels the fire and reminds him people are reading his statements.

Prsnep

Why not simply downvote him when he’s ruffling feathers and upvoat genuine comments?

Mark.ca

LOL…now you can talk from own experience.

Tom

It’s the Buick version of a Volt. I’m not much of a GM design fan, but that’s a nice looking car and gives the impression of upscale. Makes no sense to my why the US doesn’t get this vehicle. I would think people would more willingly buy a $40,000 version of this Buick and spending that cash on a Chevy.

Dav8or
Because China is more important than the US. All the R&D money as well as expenditures for new production go to China first and foremost. The US market still trends away from plug in hybrids and cars in general. CUVs, SUVs and pickups (all fossil fuel burning) in that order are the most important here. There’s not a load of incentive for GM to bother to import a car like this when they already have the Volt. Chances are, they were planning to import this car here from China and cancel the Volt, but this new battery fiasco has likely pushed that plan way back. Oh well, sucks to have to suck up to the Chinese government, but that’s the game over there and those are the rules well known to everybody. Making he big bucks comes with risk. Maybe Mary Barra can score some Ambien from Elon so she can sleep at night. Take note all you guys commenting here that can’t wait to get awesome new Chinese cars that will be super deluxe but somehow super cheap. GM put the brakes on this car due to poor supplier performance. Chinese companies typically just ship regardless and let the… Read more »
REXisKing

Well then, this makes Trump right about trade.
Wrong on taxes, deficit policy, global warming( which will kill the economy ) and policies based on racism. But, he’s right here.

REXisKing

Between a Chinese Volt and an American made Tesla.
There’s no question: Tesla.

GM can not be serious.

Dav8or

Don’t be so smug. Tesla has plans to build in China too, they’re just late to the party. Once they have have their factory we will see Chinese made Teslas here too. In fact it was rumored that the Model Y was going to be built in the new Chinese factory, not here. So you may end up with Chinese Volt vs. Chinese Tesla.

earl colby pottinger

However, they will build their own batteries or have contract that really hurts a supplier who does not deliver to specs.

antrik

I seriously doubt Tesla will export Chinese production to the US, considering how outspoken Elon is about local manufacturing.

rey

Tesla will build in China With Panasonic battery cells just like in US , Nevada,for Chinas market,the cars will be in demand there for years to come,no need to export.

scottf200

Buick Velite 5 is the Volt.

BroncoBet

What a disaster for GM, keep us up to date on this important story.

David Green

I am not sure if this is a disaster for GM, although it is certainly not optimal. I think GM dodged a bullet, as if these batteries started production and then had a massive recall, that would have been much worse financially. This is just a delay, while they figure it out. Maybe A123 fixes the production, and solves the issue, or GM has to go to a different supplier.

CDAVIS

@David Green said: “I am not sure if this is a disaster for GM… This is just a delay, while they figure it out…”
—————

Imagine if article headline instead was:

Tesla China Dream Falters Because Of Bad Batteries

ffbj

Are you saying that he would be all over that like a cheap suit. Well, yes, we all know which way the wind blows when it comes to comments from that source.

Doggydogworld

Of course. To be fair, though, a battery supply problem is less of a disaster for a carmaker that’s 98% ICE than a pure BEV company like Tesla.

earl colby pottinger

Cheap, make that a rice paper suit.

Chris O

Welcome to the snakepit…

ffbj

Good call, as usual, and that is what everyone who knows something about the subject is saying.
I would amend that to say unmitigated disaster for there is no clear immediate remedy for the problem.

Speculawyer

Remember how people thought that Elon was totally crazy for wanting to build a MASSIVE battery factory to build their own high-quality and mass-produced batteries in to to ensure they had an adequate supply of quality batteries? They said it was a white elephant.

Yeah, that move is looking pretty damn good these days. No other car company can even build a decent number of EVs these days even if they wanted to because they lack a good supply of batteries.

(Of course Solar City’s call on building a giant solar PV panel factory in upstate New York is not panning out so well. But maybe it will if they can start pumping out those solar roof tiles out in quantity and at reasonable cost. Jury is still out on that one.)

Viking79

Not sure what that has to do with here. The issue here is that GM is forced to use a Chinese battery supplier instead of LG for protectionist trade reasons. I am sure they will work through this issue, but I don’t like that kind of trade policy. In the US the EV incentive is available to any company, not just ones with batteries made in the US, for example.

Right on. It’s for reasons like this that we do need to fix some of our trade issues with China. I don’t know that a trade war is the right approach, but this protectionist stuff is crazy and other countries are at a large disadvantage in China because of it.

Brian

The US has required that 25% content of imported pickups be made in the states for a few decades. I’d say that protectionist policies are bad regardless of the country.

Toast

Don’t forget the chicken tax. Those imported pickup trucks are also subject to a 25% tariff that other types of vehicles don’t have to pay. So you get stupid stuff like Ford, who still imports their Transit Connect vans. Iin order to not be classified as a light truck, they install seats and windows in the back when they build them in Turkey. But then after they arrive in the US, they put panels over the windows, pull the seats out and throw them in the trash. It’s cheaper to waste the money on the seats than to pay the tariff. But those costs still have to be paid, so they just get passed on to the consumer. Extremely stupid.

Viking79

Yes, the chicken tax should go away. It is one of those protectionist tariffs I am referring to 😉 However, it was effective at getting a bunch of SUV and truck factories here, like BMW X5, Toyota, and Nissan truck factories.

Toast

The BMW X5 isn’t subject to the tariff, so that factory would be here regardless. And Nissan and Toyota build most of their domestically purchased vehicles here, even though the chicken tax only applies to a small fraction of their sales. Those factories would be here with or without the tariff. The only difference is that with the tariff, consumers have fewer choices and pay more.

Brian

I heard they ship the seats back to the UK and get installed in the next van coming over.

Stimpacker

Yup, like it or not, these unfair rules are tantamount to a trade war. Fight back or lie down?

Pushmi-Pullyu

We should fight back using smart “trade war” strategies, not extremely stupid, self-destructive stupid ones. The problem with a one-on-one trade war is it hurts both countries equally, so that makes it very hard to “win” such a war.

The smart way to go about conducting a trade war is to get allies for the coming war before you impose tariffs, so it winds up being several countries ganging up on one. The Trans-Pacific Partnership (TPP) should have been the U.S.’s natural ally in a trade war with China. But one of the first things the current presidential administration did was to exit the U.S. from the TPP. As I said: Extremely stupid and self-destructive. Seems par for the course for this administration. 🙁

Speculawyer

Oh, I’m just pointing out a different subject. And I agree that the Chinese trade policy needs to change. But that said, GM could have build their own battery factory in China (with a local partner) or in the USA but has chosen to do neither.

theflew

Tesla built a building that Panasonic is co-located in. Tesla did not build a battery factory – Panasonic did.

Speculawyer

That’s just silly. Did Panasonic buy the land? Come up with the idea? Raise most of the capital? Negotiate with states for tax breaks? Do any assembly beyond the raw cells?

Yes, Panasonic is an important sub-contractor. But it is not their factory.

Viking79

Doesn’t matter, Tesla needed a partner to produce batteries in the volumes they needed without huge up front capital expenditures. Panasonic took a huge risk that Tesla would actually be successful. Tesla needed Panasonic. They aren’t just a subcontractor here, they are a partner, as in co-owner. Panasonic spun off a Panasonic Energy Corporation which resides in GF1. Tesla couldn’t afford to build GF1 by themselves.

Pushmi-Pullyu

That’s right; Panasonic is a true partner (not just a sub-contractor) with Tesla in Gigafactory 1. This isn’t a zero-sum game where only one company can be responsible for what’s made at the factory. It’s a true partnership and a win-win situation for both Tesla and Panasonic!

But Tesla is clearly the dominant partner in the partnership, in terms of capital investment, in terms of negotiations with the State of Nevada and with suppliers to the factory, and in terms of control of production.

rey

It is mutually beneficial to both companies, in early start of production of Giga1 Panasonic CEO was so grateful to Teslas vision and leadership in getting Panasonic to commit to partner with them, and Panasonic was reaping profits as a result,The electronics division was suffering a clobbering by the Korean Chaebol giants of Samsung and LG ,and to this day stands so.
I was in SE Asia last year ,you will see Samsung & LG everywhere and Panasonic displays are a fraction of the floor space,the same with FsTVs,Panasonic dominates in Ricecookers, LOL

Pushmi-Pullyu

“Tesla did not build a battery factory – Panasonic did.”

Hmmm… let’s look at the facts.

Tesla built and owns the factory; Panasonic rents space inside, and has installed a lot of equipment there. Tesla, not Panasonic, manages the input of raw/ pre-processed materials to the factory, including the materials Panasonic needs to build battery cells. Tesla, not Panasonic, chooses the level of production.

That’s not to belittle Panasonic’s contribution to Gigafactory 1; it’s a true partnership, a win-win situation. That’s something that increasingly factional and tribalistic political camps in the U.S. need to be reminded of: That it’s not only possible, but commonplace, to have a win-win situation!

But to say that Panasonic “built” Gigafactory 1… well, that’s at best a wild exaggeration. The idea was Tesla’s, and Panasonic went along with it only reluctantly, with much hesitation and foot-dragging. It is Tesla, not Panasonic, which is in charge of construction there. Correct me if I’m wrong, but the construction permits all say “Tesla”, not “Panasonic”.

rey

Tesla owns the Bakery and the Building ,hires most of the employees ,Panasonic owns some of the pots and pans and mixing bowls, if you want to do a comparison to a bakery. The sign outside says TESLA not Panasonic , clear enough??

Spider-Dan

So if GM had partnered to build a Chinese factory with A123 – exactly as Tesla partners with Panasonic in the U.S. – how would that have changed the outcome here?

Speculawyer

Well, presumably they would have much better insight in the problems earlier. They would also have their own dedicated supply of batteries that they could grow as needed instead of being at the whims of the supplier.

Matt

“Well, presumably they would have much better insight in the problems earlier.”

THIS. So many companies, my employer included, import so much junk and put them into the final product in the U.S. but can’t control the quality issues that start outside of U.S. borders. Cheap labor? You get what you pay for.

Spider-Dan

You can get the same insight with a battery partner without building your own factory; simply assign full-time employees to work with them at the existing battery factory. And the problem here was not that the battery supply was too low, it was that the batteries were out-of-spec. Having a greater number of out-of-spec batteries doesn’t solve the problem.

Pushmi-Pullyu

Auto makers need to partner with a battery maker to build high-production factories to supply future needs for long-range EVs. Those which do, will have a much better chance of surviving the EV revolution. Those which don’t… well, let’s just say the chances aren’t good that they’ll still be in business 15-20 years from now.

But the auto maker has to choose the right battery maker as a partner. Tesla chose the right battery maker, Panasonic, to build Gigafactories. Contrariwise, for example, Nissan chose the wrong battery maker, NEC, as their partner to build AESC battery factories. NEC batteries have proven inferior. Nissan doesn’t want to use them any more and wound up trying to sell off AESC.

Did GM choose the wrong battery maker in A123? Or is this a case where Chinese suppliers (all too many of which are infamous for trying to cheat their customers in any way possible) cheated both A123 and GM? I dunno. I can only go by what this article says, and it’s definitely not clear.

Spider-Dan

Automakers don’t need to build their own battery factories any more than they need to build their own tire factories or run their own iron quarries. There is no evidence that the global battery market will be unable to meet the needs of EV production, and even if that turns out to be the case, there is no evidence that owning your own battery factory will exempt you from this issue.

For example, if there’s a global lithium shortage that prevents LG Chem from ramping up battery production, why would Tesla/Panasonic be exempt from that? There is no Tesla Gigamine.

Pushmi-Pullyu

“There is no evidence that the global battery market will be unable to meet the needs of EV production…”

You write as if there was some question about. No “evidence” is needed; that’s the reality of the near-term battery shortage in the market.VW was complaining about that reality rather recently.

https://insideevs.com/lithium-ion-battery-shortage-looming/

“…there is no evidence that owning your own battery factory will exempt you from this issue.”

I’d say Tesla is providing pretty good evidence for that. Something north of 75,000 pieces of “evidence” so far this year, and perhaps another 100,000 or more to come.

“For example, if there’s a global lithium shortage…”

Oh, please. The only people talking about a lithium shortage are those trying to sell us junk stocks in speculative mineral exploration companies.

But even if there would be a shortage of, let’s say, cobalt, those battery factories with long-term commitments to keep increasing their supply for EV makers will certainly be in a much better position, with their long-term contracts with their suppliers. It’s the battery makers (such as LG Chem and others) who are waiting until they have contracts in hand, who will wind up without a chair when the music stops.

rey

It’s not LG or SDI who will have no chair when the music stops Its the Car co.s as they are all chasing the same Battery suppliers , so they all will overpay for those batteries ,Audi has just delayed the launch or their ETron as of last Friday,Oct 26 ,2018 this post late i’m reading a month behind.

earl colby pottinger

When it is your factory you control the workers, management, inspectors and equipment.

When it is not your factory you do not control the workers, management and equipment.

And as for your inspectors, if you do not have the control on the other factors too often they can be fooled. Going half-measures to save money tends to bite back in the long run.

rey

The Tesla mod3 has now surpassed 100,000 units and have Outsold even German ICE car sedans in the USA with a full quarter to go in the yr 2018,the 2170 Panasonic cells tailored to Tesla specs. has the lowest cobalt content, much lower than the competitions futures batteries.

rey

2 words : Quality Control .

Dav8or

Yeah? How many batteries has that Chinese Tesla Gigafactory produced?

Pushmi-Pullyu

A more pertinent question: How many Tesla bashing posts have you produced?

TwoVolts

If GM had developed their own battery design, wouldn’t they just be able to join with a Chinese partner – as required by the Chinese government – and have a reliable supplier?

Regarding Chinese protectionist trade policy, you may not like it but you have to admit that it has allowed China to become a manufacturing and economic power.

I’m pretty sure they did design their own battery, they provided specs to A123 for their design and the requirements for the cells, and A123 didn’t meet specs.

TwoVolts

I wasn’t clear. By battery design, I am also referring to a manufacturing process to make a specific battery. Otherwise, the ‘design’ is just a list of specifications for a supplier to meet.

Matt

That’s absolutely correct. And even if they hired 100 college grads as manufacturing engineers, they aren’t THERE to oversee the actual production, nor are they able to guarantee that their instructions are even understandable. Yes, something as silly as “language barriers” still cause serious problems today.

Pushmi-Pullyu

And yet, GM partnered with LG Chem/ LG Electronics to build battery cells and packs for the Bolt EV. There has been a great deal of argument (and, I’d say, no clear answer) over just how much GM contributed to the design of the battery cells. But obviously that has been a successful partnership.

If an attempt at a similar partnership with A123 has run into trouble due to defective batteries, then should we blame GM for that? Let’s just say that wouldn’t be the first place I would look for who is responsible for the failure. This isn’t the first time A123 has supplied defective batteries. In fact, A123 once went bankrupt, and a massive recall of defective batteries was a significant contributing cause.

Perhaps A123 needs to work on its quality control… a lot!

https://greentransportation.info/ev-batteries/a123systems-financial-troubles.html

David Green

I think you have the wrong A123 PuPu…

The Spark EV used A123 batteries for 1 model year before switching to LG Chem.

https://insideevs.com/gm-shifts-2015-chevy-spark-ev-battery-manufacturing-house-facility/

GM switched to LG Chem for the Spark EV in 2015 to have a lighter, more efficient and cost effective battery.

While the Spark batteries were not of dubious quality, there were thousands of A123 defective battery packs and the company had major internal issues. It led them to try and back out of contracts during their bankruptcy.

https://insideevs.com/bankrupt-a123-looks-to-break-fisker-battery-contract-threatens-karma-production/

Pushmi-Pullyu

“I think you have the wrong A123…”

Kinda like you think Tesla’s Gigafactory 1 is in AZ?

😆 The Force is weak in this one.

Dan F.

China really should not have been allowed to join the WTO.

Pushmi-Pullyu

“The issue here is that GM is forced to use a Chinese battery supplier instead of LG for protectionist trade reasons.”

No, GM wasn’t “forced” to go down this path; it’s merely where the path they chose to follow has forced them to go. That’s what GM wound up having to do because they refuse to invest in building battery cell factories whose output (and quality) they control. As I understand it, Tesla is planning on having Panasonic set up shop in a Gigafactory in China, to supply batteries made in China. Tesla is going about setting up to make EVs in China the smart way; GM isn’t.

It amazes me that Apple is consistently able to get quality consumer electronics made in China. (But then, the majority of parts in Apple products are not made in China; they are mostly just assembled in China.) Apple must have a very strong and very active quality control department, constantly checking every shipment from Chinese manufacturers to make sure they’re actually getting what they ordered — and not counterfeit parts!

Doggydogworld

China GF is packs and cars. Musk said they’re still figuring out what to do about cells.

Pushmi-Pullyu

It is reported that Panasonic is in talks to set up shop in Tesla’s forthcoming Gigafactory. Perhaps it’s premature of me to believe those talks are just working out the details, but I’m under the presumption that this is the case.

https://cleantechnica.com/2018/05/14/panasonic-capitalizes-on-tesla-partnership-eyes-expansion-in-china-beyond/

10rey

I had a friend who did refurbishing of electronic goods from China, brand new products , 80 % of products returned by customers to store ended up in his shop and only 10% was worth fixing in the time allowed.

rey

I read somewhere China has opened up trade restrictions on S.Korean Co.s like Samsung and LG so they can open up factories without surrendering trade secrets to the Chinese. Imagine that a Chinese car like NIO or Lucid using LG chem batteries being sold in China , they all win,China car co. LG or SDI, environment ,all win.

David Green

Nobody in the industry thought Elon was crazy to build 30% of a massive battery factory in AZ. Skeptics questioned if it was the right time, and battery cost were at a point where this scale made sense. As it turns out both were right in some ways. Tesla was not able to build the factory, and ramp as they guided to investors to get the money, however with the 70% scaled down project that Tesla did build they have been able to reduce their battery cost by some amount, and scale production of their Model 3, although much slower then originally guided.

Speculawyer

It’s not scaled down, it is a work in progress. It is a factory being used and built simultaneously. As the market grows, the Tesla Y hits the market, the Semi hits the market, more grid battery installations are done, and more powerwalls are sold; the Gigafactory will keep growing.

In fact, they are still way behind…Powerwall customers have all been told that they are not going to be getting any more Powerwalls this year.

Doggydogworld

It’s scaled down. The original plan was 35 GWh of cells from raw materials. Instead they’re doing 35 GWh from processed powders. That’s why they only need 30% of the space.

They now say it’ll do 105 GWh of cells at full size so they can maintain the perception that it will eventually be the biggest factory in the world. There’s no date for that, though. It also means they gave up on making batteries from raw materials.

David Green

No construction going on now, I just looked at 1 week old satellite images, there are no signs of upcoming construction around the perimeter of the existing structure, and all the construction equipment/ materials I can see on site looks to be in a stored state. I would not expect any construction is upcoming soon. I did hear Tesla has ordered Panasonic to equip and start 3 more lines of battery cells, bringing the total to 14 lines, but that is also a ways off. carsonight on the other Tesla biased blog site usually has very accurate and up to date GF1 information. He says GF1 now maxes out around 4800 Model 3 packs a week.

Pushmi-Pullyu

“No construction going on now, I just looked at 1 week old satellite images…”

Well it’s no surprise you can’t find any signs of construction, since you’re looking in the wrong State! Gigafactory 1 is in NV (Nevada), not AZ (Arizona).

But thanks for keeping us entertained with all your unintentional humor.
😆

earl colby pottinger

Also I did not know public satellite images looked thru walls/roofs. There could be major work going on inside that would not show up on a satellite image.

David Green

Where are Tesla Y and Semi going to come from? There is no battery capacity, no factory, and in the case of the Y there is not even a prototype vehicle, they are just building it now… Being the prototype is the cheap, and easy part, production design, and engineering is the hard and expensive part, then you have to build a factory and battery capacity, where is that money going to come from?

Speculawyer

You realize that the Y would be their 5th car, right? Your post seems to come from 2011 or so.

David Green

And Y is where? have we seen specs? Prototype? Factory? Nope, we still have not seen the 35K model 3…

Pushmi-Pullyu

Tell me, do you intentionally go back and copy exactly what serial Tesla bashers posted just a few years ago, and change the name “Model E/3” to “Model Y”?

Dude, Tesla has won. The Model 3 is a runaway success, and Tesla will never again be in danger of imploding.

Tesla won; serial Tesla bashers have lost yet again, and this time for good.

Get over it.

David Green

haha! PuPu, Tesla is struggling, big time

rey

I know this is a month late ,Tesla just posted a BIG SURPRISING 3rd Q PROFIT

Pushmi-Pullyu

“…where is that money going to come from?”

Ummm… from the same places most or all the money came from for Tesla’s other cars. Duh.

David Green

haha PuPu, you better go buy one, they have thousands of them sitting round covered with dust… Just waiting for you…

rey

Please do GOOGLE everything first before POSTING YOU SOUND SO STUPID.

Spider-Dan

Had GM built it’s own Gigafactory next door to Tesla’s, it would have not helped at all. The reason why GM’s China EVs don’t use the same LG Chem batteries that the North American versions use is because of Chinese protectionism.

earl colby pottinger

Does not matter. GM could have partner with the best Chinese battery manufacturer — but it did not. They are paying the price of being cheap.

rey

GM is an ICE car company, that is why they’re buying LG batteries not building them inhouse and most likely the same reason for the traction motors and for sure the infotainment system.GM is a Dinosaur.

Speculawyer

GM is definitely an ICE company…but it is also an EV company. GM has the best non-Tesla EV available on the market today. They have a very difficult job in managing the transition gracefully.

Pushmi-Pullyu

If GM is “an EV company” then why did they farm out the manufacture of the entire EV powertrain to LG Electronics/ LG Chem?

Moving forward, as the EV revolution grows, wouldn’t it make sense to develop their own EV tech in-house, just as legacy auto makers all developed their own gas engine tech in house?

GM is certainly not acting like “an EV company”!

theflew

What’s the difference than Tesla buying batteries from Panasonic.

Pushmi-Pullyu

At least two very important differences:

1. Tesla’s partnership with Panasonic has been highly successful for both companies.

2. You don’t see headlines like these about batteries Panasonic makes for Tesla.

David Green

Panasonic makes money, Tesla doesn’t…

Enthusiast

I’ve been reading a lot of this discussion and it’s just as silly as usual but your comments about GM needing to build its own factory is your uneducated opinion based on nothing but your feelings. This last comment is lazy. Maybe GM hasn’t decided to make its own battery facility because the current volume of electric they are selling doesn’t warrant it. Tesla had to create a market for electric cars because that’s the only kind of cars they sell. They had to assist in the creation of a battery factory because they had no other choice. As others have mentioned, GM already has a successful car company and has to be mindful of an efficient and thoughtful transition to electrics to remain profitable. Tesla has to take larger risks to get in the game and it’s too early to declare them a success from a financial sense.

Pushmi-Pullyu

“…your uneducated opinion based on nothing but your feelings.”

Wow! 😯

Dude, as they say: You’re entitled to your own opinion, but you’re not entitled to your own facts.

Regarding near-term EV battery supply, VW head of group strategy, Thomas Sedran, said: “The capacity is not there. Nobody has the capacity.” VW is in talks with no less than six different battery suppliers because, apparently, no individual cell maker has even remotely enough production capacity for what they need over the next few years. See citation below.

So, “Enthusiast”, I think most people reading both my comments and yours might have a different opinion of just who has an “uneducated opinion” which is “based on nothing but your feelings.”

https://insideevs.com/lithium-ion-battery-shortage-looming/

rey

GM is profitable , that is why they had to be rescued from BK? GM has made wrong decisions in the past ,will make the wrong decisions for the future, are you willing to give your tax $$$$$$$$$ for BAILOUT # 2?

Brian D

Which automaker builds their entire batteries in house? Not Tesla, they use Panasonic to build the cells for them. Yes it’s a step better than GM, but without Panasonic, Tesla would have nothing.

Pushmi-Pullyu

Without Panasonic, Tesla would have found a different battery maker to partner with. Tesla has certainly flirted with using Samsung as an alternative supplier.

Bunny

I don’t understand your post, for example, Tesla buys Panasonic batteries for their battery modules, what’s that make them? Tesla doesn’t build batteries in house. I think BYD actually does build or has built batteries. But I can’t think of another automaker that actually makes batteries including Tesla.

ModernMarvelFan

“I think BYD actually does build or has built batteries. ”

that is because BYD was a battery company first and then car company second…

Viking79

Just to clarify here, the cylindrical things are individual cells. When you put multiple cells together you get a battery. Panasonic Energy Corp makes cells at GF1 and sells them exclusively to Tesla. Tesla takes those cells and puts them into a battery pack. Tesla makes “Batteries” Panasonic makes the Li-ion cells for those batteries. LG makes cells. GM makes batteries from those LG cells.

Who makes their own cells? Nissan (failed, selling them off), BYD, not sure who else… Toyota does some research, probably others.

Pushmi-Pullyu

Probably others? Nope, you cited the entire short list. BYD (which started as a battery cell maker), Tesla (in partnership with Panasonic) and Nissan (formerly in partnership with NEC for the cell making AESC subsidiary.)

We can expect that to change in the near future, as legacy auto makers either partner with battery cell makers to build cell factories so they can control their own supply… or being left out in the cold with increasingly inadequate supplies of cells.

Andy

GM, like most companies buy parts from other manufacturers to fit in their cars. They also work with other manufacturers to build critical parts of their vehicles (see the new 10 speed transmission – a joint GM/Ford Partnership – as an example). This is normal, nothing dinosaur about it. Sometimes it’s beneficial, sometimes – like this example – it can backfire.

This is not going to change any time soon.

Bunny

Good example is the fairly new GM/Honda partnership on battery tech to drive down manufacturing costs . I think it’s wise not to put all your eggs in one basket, just sayin’

rey

GM and Honda ,@ giants so far behind in Battery technology they have to partner so they are not left behind by Tesla, Oh DANG! Tesla just surpassed 100,000 Tesla Mod3s with another quarter to go for 2018.

bro1999

Good thing they caught this before production started, compared to say other manufacturers who would do the electric slide with such an issue. 😉

ffbj

The eternal optimist when it comes to GM. Consistency is the hobgoblin of little minds, or something like that.

Pushmi-Pullyu

“A foolish consistency is the hobgoblin of little minds.” — Ralph Waldo Emerson

The “foolish” qualifier gets left out of that quote far too often. Consistency is often a good thing; it’s carrying that too far which is foolish.

David Green

Thats exactly what I said… GM caught it in their internal testing and validation program…. Its a delay, and bummer, no doubt, but nothing material to GM’s business… WSJ blew the headline out of proportion.

Pushmi-Pullyu

A delay isn’t material to GM’s business?

I’m sure that if this was about Tesla, you’d be not merely suggesting the exact opposite, you’d be loudly proclaiming it!

David Green

GM has more then 1 product line, Not like Tesla with just one major source of revenue… Fro GM if one plant is down, its no biggie, they have 30 others…

rey

Except when that market is CHINA , the biggest market for vehicles WORLDWIDE and the WORLDS BIGGEST MARKET for BEVs, Yeah , no BIGGIE

CCIE

I’m sure there were forced to use an in-country supplier. But, is it really a major surprise that a 3rd party chinese supplier can’t provide a good product? They need one of the 49/51% relationships so they at least have some internal oversight of such a critical supplier.

Carcus

Samsung has a battery manufacturing plant in China. .. or at least it did before it caught fire last year.

CDAVIS

Article lead-in sentence: “Chinese-built EVs not as easy as A123”.
————————

Clever…

HVACman

A123 and GM have a checkered past. A123 used to be a US company and GM was considering using them for the original Volt batteries. But LG Chem has a more robust profile with more commercial battery experience, so GM went there. GM did briefly use an A123 pack (bottom-plate-cooled!) for the first Spark EVs, but after China’s Wanxiang Group bought A123, GM used cells made by LG Chem with a very Volt-esque module design and cooling concept.

So GM finally trusts the now-Chinese-owned A123 for a real production battery and gets burned. Probably a lot of veteran GM and LG Chem battery engineers in Detroit muttering “I told you so”

Dateline November 2008 – MIT Technology Review

“Why A123 Didn’t Get the Volt Contract – GM is playing it safe with its promised electric car, choosing a veteran battery supplier.”

https://www.technologyreview.com/s/411190/why-a123-didnt-get-the-volt-contract/

HVACman,
“GM did briefly use an A123 pack (bottom-plate-cooled!) for the first Spark EVs,”

LOL we wrote an article on it in 2013!!
https://gm-volt.com/2013/08/02/spark-ev-versus-volt-battery/

Bunny

That’s what I enjoy about reading these posts, really enjoy learning plus reviewing the depth of knowledge a lot of people here have both past and future EV tech.

Thanks !

Nix

A123 LLC is still a US company, and they are committed to continuing to be a US based company, even building new corporate headquarters right here in the United States. The China and Czech factories are satellites for this US based company with majority Chinese ownership:

https://advancedmanufacturing.org/a123-systems-new-headquarters/

“A123 Systems LLC, a developer and manufacturer of advanced lithium-ion batteries and systems, today announced plans to build a new headquarters complex in Novi, Michigan, representing a $40 million investment in the company’s future…..“We are making a commitment to a continued significant presence in Michigan, in proximity to the skilled and experienced talent here,” …. “This new complex meets future needs by becoming our epicenter of engineering….The expanded engineering center announced today will continue to lead the development of new low voltage products for the growing global markets. Production for these products will be located in close proximity to customers, including the new Novi manufacturing facility, the recently announced facility in Ostrava, Czech Republic and the ongoing expansion at the company’s Hangzhou, China campus.”

Some Guy
Soon, GM needs to sell lots of EVs in China to get the Chinese equivalent of ZEV credits, or they will be banned from selling cars (China doesn’t do slap on the wrist fines like US with ZEV credit systems, they just ban ICE sales if one does not have the credits to show for). Reluctantly, GM agrees to build the minimum requirement of EVs using Chinese batteries. They could use others, but only with Chinese batteries they would qualify for the subsidies, and it might be tricky to get Korean batteries in high quantity or on short notice at this point. The problem with the lack of A123 batteries that ultimately could hurt GMs China sales significantly now comes totally unexpected… (I would not be surprised if this was planned years back, and therefore say: Well played, China). I would not be surprised if the announced production increase of the Bolt is solely meant for export to China in an attempt to keep access to that market if they lack the Buick credits. I also would not be too surprised if other western car companies will experience similar problems when sourcing their cells for their Chinese EVs. Tesla will… Read more »
rey

Tesla played its hand just right in this game of Poker for Batteries and BEV and Factories , advantage Tesla.

Bob

It looks like no one (GM or A123) really learned anything from the expensive Fisker incident…

Nix

Yup, it looks like GM just got Fiskered.

(⌐■_■) Trollnonymous

If this were Tesla, haters would be…..

“Poor planning”
“Bad management”
“Company too young”
“Inexperienced logistics”
“they should’ve planned for this by having a backup vendor”
Blah blah blah…….

So where are those people now?
How old is GM today?

drpawansharma

ccurrent GM is only as old as Obama presidency

Mark.ca

…only on paper.

earl colby pottinger

Not the people running. Also this is a direct opposite of the claim that GM can bury Tesla because it has decades of experience building cars.

So which is it? A older company with lots of experience to compete and outdo Tesla or a new company that is just getting on it’s feet competing against another new company?

You can’t have it both ways – make a claim and stick with it and stop trying to move the goal posts around to support the ICE companies.

rey

GM and all of Old Auto will be hamstrung by ICE legacy ,its marketing and biggest one of ALL, its ties to NADA

rey

just a shade over 9 yrs if you discount the prior century. LOL

Mark.ca

“it’s a great place to get things made, with low costs and high quality. ”
You may wanna rephrase that a bit. We Americans, one of the Cheesiness market biggest consumer can tell you alot of stories about that “high quality”.

ModernMarvelFan

That is because American consumer ONLY buys the “ultra low costs and low quality” version of the product when “low costs and high quality” version exists.. In their mind, ultra low cost is better than low costs and that is more important than the quality metric.

Mark.ca

Where do i go for the quality stuff? From my own experience, when i bought more expensive stuff it was either counterfeit or had the same poor quality as the cheap stuff. Just because it’s more expensive it doesn’t mean they put more thought into it.

ModernMarvelFan

Aren’t Apple product relatively high quality? It is lower price than if it is made in USA…

Mark.ca

If AAPL is your only argument then you know your point is weak. Honestly, I’m not sure how they are pulling this off.

Nix

^^ This.

For centuries western nations traversed long and dangerous trade routes to get superior Chinese trade goods.

Then in the last half of the 20th century American companies created cheap design specifications, built factories in China specifically to build low quality goods, and set up quality control checks that approved the delivery of poor quality items.

Then US consumers lined up to buy those poor quality goods because American consumers chose cheap over quality.

Somehow this whole process, driven by American companies and American consumers is used as derogatory comments against another country. Meanwhile Chinese companies are crushing most US, EU, and Japan based car companies with massively higher EV sales, and reports of problems like this are the exception and not the rule for Chinese EV’s. They are beating us.

rey

Correction : They will beat us.

rey

We all know DOLLAR Stores sell “Quality products” , We have become Chinas dumping ground , now China wants to stop the garbage being returned to them. LOL

(⌐■_■) Trollnonymous

” A123 has been producing are not up to specification ”

I’m curious on what the spec’s are that could not be met. Pretty sure it’s not cycle life as the LiFePO4 nanophophate A123 uses has high cycle life.
A123 build LiFePO4 cells. Electrical characteristics are quite different from what GM normally uses of type/derivative of “lithium manganese spinel” but I think now NMC.

ffbj

One silver lining is that now GM has an excuse as to why they will not produce 20 electrified car models, 10 of them bev, in the next 4 years, as they claim: http://www.autonews.com/article/20171002/OEM05/171009946/general-motors-gm-electric-vehicles-expansion

Of course this claim by GM is complete nonsense. I guess one could call it the 5 year plan that started a year and a half ago.

windbourne

Poor GM.
Of course, I will NEVER buy another GM, or brand from them again.
Hard to believe since my mothers side worked on Buick (as engineer back in the 40s), Saturn, Chevy/Pontiac, etc.
We never bought anything but that.

Now, you could not give me a GM.
And in another 5-7 years when they will bankrupt again, I will vote against ANY politician that votes to bail them out again, unless they are broken into 5 or more car companies.

Bobolink

lol, my GM Volt has over 100k miles on it and 7.5 years old. My maintenance/repair total to date is under $600. Best car I have owned, hands down. My battery miles still well exceed the car’s EPA sticker. But to each their own.

john1701a

Careful with the lol. GM was able to deliver at a loss with tax-credit dependency. Doing the same without subsidy help for a profit is far more difficult.

Scott

Batteries will be a problem with all car manufacturers except Tesla. Plus buying batteries from a third party cuts into profits. Other manufacturers will need gigafactories.