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A Tiny B-Sized Vehicle Will Be Built In Michigan

GM claims its flexible manufacturing operations and UAW concessions make a competitive, small car built in U.S. possible. All other U.S. B-cars are currently imports.

by on Jun.26, 2009

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The Chevrolet Aveo and G3 Pontiac are currently imported for sale in the U.S., as are all other B-cars.

Troy Clarke, president of General Motors North America confirmed this afternoon that its assembly plant in Orion Township and stamping facility in Pontiac, both in Michigan, will build its future small sub-compact B-car and another larger C-size car, of roughly the size of the Toyota Corolla.  

The volume car in the plant, at about 100,000 units annually will be B-sized, a class that includes the current Chevrolet Aveo and G3 Pontiac, which are currently imported for sale here. Other B-size cars in the U.S. include the Honda Fit and Nissan Versa, on sale for years now, as well as the upcoming Ford Fiesta, which is belatedly due next year.

This is one of the toughest most competitive segments in the world, and one that is dominated by offshore brands that have government protectionist policies, and high fuel and car registration taxes to support them.

GM is part of this global trend  that has clearly hurt the U.S. economy. GM Daewoo Auto & Technology (GM Daewoo) in May sold domestically in Korea 8,155 vehicles and exported 35,823 vehicles. Established in 2002, GM Daewoo now produces vehicles and kits for Chevrolet, Buick, Opel, Vauxhall, Pontiac, Holden and Suzuki that are offered in more than 150 markets on six continents.

Conventional wisdom has long held that American manufacturers cannot make money on small cars, especially if they are built in the U.S., where labor rates and productivity have been non-competitive with foreign, and especially Asian manufacturers. But the numerous concessions made by the union, in recent years, and recent givebacks meant to turn around the domestic industry, have changed the equation.

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Chevrolets’ Avea is currently selling in the U.S. at about 40,000 units annually, a mere footnote in sales charts, and Clarke frankly admitted that GM is banking on rising fuel prices to increase demand and make the car profitable. He also said the attributes of the new — as yet unnamed B-car — would also help sales of the car, which is said to be an upgrade on the current B-size platform that is based on a Korean design from Daewoo. The new B, like its predecessors, will be built globally at “several plants.”

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Michigan Charges into the Battery World

Rustbelt state hopes to reinvent itself as EV Central.

by on Apr.14, 2009

LG Chem President and CEO Kim Bahn-suk (left) meets with former GM Chairman Rick Wagoner in front of the Chevrolet Volt electric vehicle.

LG Chem President and CEO Kim Bahn-suk (left) meets with former GM Chairman Rick Wagoner in front of the Chevrolet Volt electric vehicle. Could future EV batteries come from Michigan?

It’s been a Winter of discontent, as Shakespeare might say, in Michigan, as the state’s automotive economy steadily vaporizes. With sales plunging and two of Detroit’s Big Three threatened with extinction, the only real business opportunity, these days, is providing U-Hauls for people moving out of state.

But can Michigan find an opportunity to reinvent itself as the center of a more environmentally friendly automotive industry?  That’s the goal of the state’s economic development officials, who will be handing out $400 million in tax credits, later today, to four firms that could help make Michigan ground zero in the production of the advanced batteries needed to power tomorrow’s green machines.

While there are still plenty of skeptics, there’s a growing push to replace – or at least supplement – the internal combustion engine with electric power.  There are already more than a dozen hybrid-electric vehicles on the market, ranging from the Toyota Prius to Ford’s new Fusion Hybrid.  And about 18 months from now, General Motors hopes to take the technology to a new level with the introduction of its Chevrolet Volt, a so-called Plug-in Hybrid, which will use battery power for daily commuting and a small gasoline engine for longer trips.  Then there are the pure battery-electric vehicles, or BEVs, such as Tesla’s Roadster and planned Model S family sedan, which will eliminate the internal combustion engine entirely.

“Mass energy storage is a critical need (that has) gone beyond the tipping point,” contends Eric Schreffler, sector development manager for the Michigan Economic Development Corp., the quasi-public agency which will choose the recipients for the new tax credits.

The problem is that the fundamental technology needed by all these vehicles doesn’t exist in the U.S.  True, there are plenty of research centers, across the country, working on the physics of lithium-ion and other advanced batteries.  But with the exception of one small factory, in Indianapolis, the world’s supply of tomorrow’s power cells come entirely from abroad, and almost exclusively from three Asian nations: Japan, China and South Korea.

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