Is Fiat and Chrysler's Pullback on Electric Cars Bad News for A123 Systems? 11 comments
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By Michael Kanellos
Fiat (FIATY.PK), the new owners of Chrysler, has apparently pushed back the effort to release an electric car, according to Reuters. Fiat has scrapped the Dodge Circuit, a two-seater electric sports car, as well as a plan to make a fleet of 220 electric and hybrid cars. The Department of Energy gave the company $70 million in grants in August to develop that fleet. Not sure if we get the money back.
The Envi electric car group has been absorbed into the regular car making group, Reuters said.
That could be bad news for battery-maker A123 Systems (AONE). A123 lost the deal to supply batteries to General Motors for the Volt earlier this year (although the two companies publicly vowed to remain friends). The Chrysler deal in April helped A123 rebound. The battery maker subsequently pulled off a successful IPO.
Will the changes at Fiat/Chrysler hurt? It's hard to say, but it's not great news. On one hand, Fiat and Chrysler still plan to come out with electric cars. Lou Rhodes, who headed up Envi, will head up electric car development for Fiat and Chrysler.
On the other hand, it sounds like electric cars are going to come out of the combined company later and at a slower pace. Chrysler earlier said it wanted to have an electric car out by 2010. On Friday, Fiat CEO Sergio "Marchionne told reporters and analysts electric cars would only represent "one to two percent" of Chrysler's sales by 2014, equivalent to less than 60,000 vehicles," Reuters wrote. The company is considering a delivery van in the U.S. Will they put some out in 2010 or will it be later? Hopefully more clarity comes next week.
"Until the [battery] storage gets resolved, I think electric vehicles are going to struggle," Marchionne was quoted as saying.
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ecdfan.blogspot.com/20...
Sure, a few enthusiastic, well meaning souls will fork over the extra money for underperforming vehicles but until we get those major breakthroughs like a super-capacitor that actually works and can be produced in quantity, (the EESTOR fantasy-dream), we are going to slog through a difficult market.
Batteries are tiny chemical devices that not only have a high carbon footprint but an inadequate life, high weight and high cost. It makes no sense for our government to subsidize them with our tax dollars.
Regards.
On Nov 09 09:00 AM Douglas Korthof wrote:
> Until Nickel-Metal Hydride (NiMH) batteries go back into production
> (Chevron-GM stopped their use via lawsuit), EVs will have the WRONG
> BATTERY with expensive Lithium that doesn't last long enough to amortize
> the original cost and that has no recycle value. A123 didn't have
> much prospect of use in transport, IMO, even before the GM pullout.
> Look at A123 revenues; it's almost all power tools, not EVs or hybrids.
> Unless Lithium works in EVs and/or hybrids, it's not easy for me
> to see where Aone's market cap comes from.
This won't make much difference for A123 because it was never that big an order.
It will make a difference at Fiat because they will fall behind the E drive curve which next yr will take off as gas lits $4-5/gal again as the economy recovers.
Ford and Nissan which are making cost effective EV's will be able to ramp up production for it. Ford because they can just switch their production lines from ICE to EV drive for their stock vehicles their EV drives are based on.
Kor seems to have some kind of problem with lithium that doesn't make sense as all the car companies are going that way and can be made at 1/4 the cost of NiMH and 50% of the weight.
While NiMH are good EV batteries, they cost too much in materials to be anything other than hybrids. And anyone buying them from Cobasys deserves what they get as they have never made a quality battery. But they refuse to license them in more than 10amphr so no one can make EV's from them.
But what do you expect from Chevron who fears EV's as they should. Their patents should have been taken away from them yrs ago for not letting others build quality ones as the laws allows.
But too late now as Lithium in many formulas are ready to take over, they just need orders.
As Nissan has 100k EV orders, that is coming soon..
Custom EV builders are going either A123 or Sky Energy, both of which are working out fairly well as we learn their care and feeding. We are buying Lithiums for $.30/wthr retail which is under the cost of retail sealed lead batteries.
I drive my lead battery EV's every day at very low costs, under $.03/mile for fuel and battery because they are lightweight, aero which cuts battery, electric costs by 50% of already low fork lift tech cost. Sadly the only way to get them now is build your own.
Although, costs are higher for plug-in hybrids, public acceptance is much easier and the consumer receives an immediate impact in their monthly expenses.
In addition, hybrids have a substantial decrease in maintenance costs. Fears of replacing batteries (at least NiMH) have never materialized, with the Toyota Prius batteries now testing in at 180k miles.
The only reason that manufactures are pushing pure electrics is to eliminate one major component, the gasoline engine. Wrong direction manufactures! Toyota has recently INCREASED the size of the gasoline engine in the Prius and increased the efficiency.
By the way - I love the quotes "green" and "cut the mustard".
On Nov 09 10:03 AM William Taylor wrote:
> At this point I see no point or future in electric vehicles without
> very major technological advances in battery development. Despite
> all the media hype and "green" nonsense out there they simply do
> not "cut the mustard".
>
> Sure, a few enthusiastic, well meaning souls will fork over the extra
> money for underperforming vehicles but until we get those major breakthroughs
> like a super-capacitor that actually works and can be produced in
> quantity, (the EESTOR fantasy-dream), we are going to slog through
> a difficult market.
> Batteries are tiny chemical devices that not only have a high carbon
> footprint but an inadequate life, high weight and high cost. It makes
> no sense for our government to subsidize them with our tax dollars.
You will find that moving up from 1 pound batteries you were building to 16 KwH packs is a different story.
Now you have 200 million dollars grants and other amount like from investors.....
LONG QTWW, AONE, HEV, XIDE
It seems that, like Chrysler did, here in the US, Fiat, in Europe, continues to lurch from crisis to crisis. VW, and to a lesser extent, Ford, is eating their lunch in most markets.