Episode 230 – Prius Line May Expand, Suppliers Have the Power, Trabant Goes Electric

September 17th, 2009 at 12:00pm

Runtime 7:06

Toyota is thinking about expanding its hybrid offerings by making the Prius a separate sub-brand. Opel’s boss says car companies have outsourced too much to suppliers to the point that the balance of power has shifted. We look at the most unlikely electric car in the world, an EV version of the Trabant. All that and more, plus we talk to Aerovironment, a company that has breakthrough technology for charging electric cars.

Transcript and Story Links after the jump . . .

Here are today’s top headlines. Toyota to expand the Prius line. Opel’s boss says suppliers have more power than automakers. And we look at the most unlikely electric car in the world, an EV version of the Trabant.

Up next, we’ll be back with the news behind the headlines.

This is Autoline Daily for Thursday, September 17, 2009. And now, the news.

According to the Wall Street Journal, Toyota is planning a $1 billion marketing push (subscription required) in the fourth quarter in the American market. The strategy was formulated in part by Akio Toyoda himself, and aims to invigorate the company’s sagging North American operations. $1 billion is a huge amount of money for an automaker to spend in a quarter, and for Toyota, it’s about 30 to 40 percent more than normal.

In other big “T” news, the company is thinking about expanding its hybrid offerings by making the Prius a separate sub-brand. There’s a lot of equity in the name, and Toyota could really cash-in on its “green-cred” by offering a wider range of dedicated hybrid vehicles.

Fascinating report from Reuters regarding Carl-Peter Forster, who runs Opel. He says car companies have outsourced too much to suppliers to the point that the balance of power has shifted in the industry. Now suppliers are in control, Forster says, because automakers no longer have the capability to develop key technology. The theory was that automakers only had to do design, marketing and final assembly. He says with electric cars, automakers need to pull more development back in-house. I’m sure I don’t have to remind you that Forster runs Opel, which is being bought up by Magna, the giant supplier.

Nissan says Thailand will become its main hub for producing pickup trucks sold outside North America (subscription required). According to Wards, this won’t affect production in North America. Currently Nissan is operating at 50 percent capacity in Thailand due to low exports and demand. Thailand has grown to the second largest pickup producer in the world behind the U.S., thanks to tax breaks for pickup makers.

Chrysler is set to resume leasing again. The company will offer leases for all of its 2010 models starting today through GMAC Financial and will offer special rates on select vehicles through the end of the month. About 20 percent of Chrysler’s customers will only lease, so it’s imperative it gets back in the leasing business.

Formula One is as much of a soap opera as it is a racing series. Now the two leaders of the Renault Team – Flavio Briatore and Pat Symonds – have resigned under allegations they had one of their race drivers – Nelson Piquet – deliberately crash his car in last year’s grand prix of Singapore. The crash allowed his team mate – Fernando Alonso – to win the race. Piquet’s crash happened just as Alonso was getting ready to make a pit stop, so he was able to pit before the pits were closed, which put the rest of the field behind him. Now Renault may sue the two guys who used to run its F1 team.

Some cars should just be left in the history books – like Edsel, Gremlin and Cimarron. But common sense isn’t stopping two companies from reviving an old East-German favorite, with a twist. The retro-looking Trabant nT debuted at Frankfurt yesterday. Unlike the original version that sported a weak, two-stroke engine and plumes of acrid smoke, the new Trabi is all electric. Its li-ion battery should deliver a range of 160 kilometers or roughly 100 miles.

Speaking of EVs, how are we going to charge them all? Up next we’ll talk to a company that has breakthrough technology for charging electric cars.

We all know that several automakers are coming out with advanced electric vehicles, and we all know that EVs have their share of benefits, but there’s at least one issue that could short circuit the whole electric movement, and that’s charging technology. In the following interview, I sit down with Kristen Helsel from Aerovironment, and she tells me about some of the company’s charging systems.

If you want to see the rest of my interview with Kristen Helsel, swing over to the John’s Journal page on our website, AutolineDaily.com. There you can watch our entire conversation, PLUS a whole lot more. CHECK IT OUT.

And don’t forget to join us tonight for Autoline After Hours. Join me, Peter De Lorenzo from Autoextremist and David Welch from BusinessWeek for some candid talk about what’s going on in the auto industry this week. That’s tonight, live at 7 p.m. Eastern.

But that wraps up this show, thanks for watching, we’ll see you tonight.

27 Comments to “Episode 230 – Prius Line May Expand, Suppliers Have the Power, Trabant Goes Electric”

  1. G.A.Branigan Says:

    I can see where charging your ev at a mall while you shop,swipe your credit card in like the modern parking meters and go do your thing.BUT,it still doesn’t address the added strain on the grid,and how long would it take to charge?As Kristen said,no need for new buildings,but the infrastructure still isn’t there.Also,recharging at a gas station would tie up the limited space for cars to refuel,which means additional space for just the ev’s.That rules out most small gas stations I believe.Until the details are worked out,go clean diesel.

  2. Willi Says:

    this agenda surely has been thought through by the experts :) however, let’s not get ahead of ourselves, not going to see alot of investment in this infrastructure until you actually see these toys on the road … battery stations?

  3. Tony Gray Says:

    Yeah, gas stations ain’t where you want to charge. That is better at home, or at work. I doubt MOST folks will not want to spend the extra coin charging at the mall, since I suppose MOST of them will have enough juice to get them back home with the stuff they just bought.

    Work may be a different matter, as lots of folks drive long distances to work, but I’d bet most shop close to home.

    Of course there are many exceptions to this rule, but I don’t see a business case for a Pizza Hut to install a ton of these things for customer use.

  4. Don MacConnel Says:

    Somebody will figure a way to change the battery fluid (I can’t exactly call it an electrolyte) instead of charging the batteries.

    Pump out the depleted stuff and pump in the energy.

    Nice dream I guess…

  5. Mike Says:

    Re: Suppliers with too much power. Oh gosh, after 10 years in the supplier industry, I never felt like I had as much as a gram of power. We the suppliers were the ready cash account every time they needed a cost down. Problem is those “downs” were a simple profit transfer from us to them. We were left with nothing to even replace our machinery with. It will be a long time before some balance, some fairness, some equity comes back into the supplier-OE relationship. It is in everybodies best interest that it does.

    Mike

  6. Alan Says:

    I can see these charging podiums used also as parking meters in the future. And, since local governments control allocation of parking spaces in their jurisdictions, I am predicting now that a person will need to pay to park anywhere one of these charging podiums stands whether they charge their car at it or not.

  7. Nick Stevens Says:

    “Mike Says:
    September 17th, 2009 at 12:37 pm

    Re: Suppliers with too much power. Oh gosh, after 10 years in the supplier industry, I never felt like I had as much as a gram of power. ”

    I am amazed at the claim myself. Teh onetime big 3 were especially abusive towards their suppliers, exploiting their “Monopsony power” (the power of only one buyer, similar to Monopoly [power when there is only oen seller)

    I have serious doubts as to the econ literacy of whoever claimed that suppliers have lots of power. I bet he is working at Ray LaMoron’s Transport Dept of our failed Obama Admin… or was an administrator in the failed CFC debacle.

  8. Nick Stevens Says:

    BAck to the Prius liner expansion, which is to me the most interesting item of this show today.

    The Prius II, while impressive, had seriously limited rear head room. Even a mere 6 footer could not fit, let alone the much taller people you see on the street today.

    They claim they have corrected it with the higher roofline of the Prius III. But before the III came out, I always thought that a Prius Wagon would solve that problem and provide extra cargo room as well.

    A Prius coupe and convertible are also not bad ideas, but I bet many more would buy the Wagon than the convertible.

  9. Tom Geauvreau Says:

    Hey John, don’t pick on the poor Gremlin.
    I had one and thought it was a neat car.
    Sure it had a bad plastic dash, but the drivetrain was bulletproof.
    The car’s North American competition wasn’t all that great.
    Chevrolet Vega. Remember that lock-up aluminum engine and rust?
    And Ford Pinto with flamable stickers plastered on their rear ends?

  10. Jim Sachetti Says:

    “And Ford Pinto with flamable stickers plastered on their rear ends?”

    While the 8-track was blaring the Ford Pinto Anthem:

    “Baby, Baby Light my Fire!”

  11. Willi Says:

    Mike, whoever you are, thanks for starting

    Carl-Peter? who is this moron? that may be true in Europe with Opel, but not here! being a tier one myself, there is barely room for competition in this business, and we’re pro active and ingenious as can be, more inovation has come from us than ever from OEM’s, we know what our business is!

  12. John Says:

    John McElroy, with all of her optimism are you sure Kristen Helsel is not in the sales department?

    “depending on the electrical service coming into the home…” ?

    Just how much electrical juice is going to be required to recharge? With “electrical utility deregulation”, and “cap and trade” surcharges, the big up-front vehicle investment, and the high battery replacement cost, the word “economy” does not fit with “EV”.

    “At the upper end of the administration’s estimate, the cost per American household would be an extra $1,761 a year.”

    see: ” Cap And Trade Redux: $1,761 Annually Per Family? Or Not? ”
    At the upper end of the administration’s estimate, the cost per American household would be an extra $1,761 a year.”

    John McElroy, I agree that shocking a battery with a massive fast charge will effect different battery design and chemistry differently. Some will take the abuse, some won’t. I wish you would have asked her about charging a EV on a city street.

    And I agree with G.A.and Tony, the real estate for a gas station is too expensive to be used as a parking lot for charging EVs. Just scrap that idea.

    This entire subject is as tangible as the cartoon Prius TV commercial.

    “Natural Gas Weekly Update”
    http://tonto.eia.doe.gov/oog/info/ngw/ngupdate.asp

  13. John Says:

    see: ” Cap And Trade Redux: $1,761 Annually Per Family? Or Not? ”
    At the upper end of the administration’s estimate, the cost per American household would be an extra $1,761 a year.”

    http://www.cbsnews.com/blogs/2009/09/16/taking_liberties/entry5316600.shtml

  14. Mike Says:

    Perhaps where the supply base went wrong was in offering technology to the OEM’s. The OE’s then took the new ideas and shopped it to the four winds devaluing any uniqueness. Then they had the chutzpah to claim “ownership” of the patents via the fine print on the back of the purchase order. Maybe the better plan would have been to do what we were paid to do: supply commodity products and commodity prices; i.e. variable cost plus 3%, no fixed costs or engineering overhead.

    Mike D.

  15. Tom Tyson Says:

    John, with regards to the electric-charging stations (not home), you said (in agreement with Kristen Helsel of AV) regarding places to recharge EVs out on the road, “…gas stations, part of today’s infrastructure….” I think you inferred that the logical place for the electrical fillup would be gas stations. However, if you pull up to a gas station, are you going to be able to get a sufficient charge without having to wait an hour? A full electrical charge in a matter of minutes, as with a gasoline fillup, would probably require 100-amps “fast charge,” and no EV will be equipped to handle such a charge and no battery-pack system could take such a fast-charge without eventual damage.

  16. Jonathan Says:

    I have to agree with Tom Geauvreau, the AMC inline 6 was really good engine, very quiet, smooth, torquey, and economical. When mated with the Chrysler 904 trans, made a very durable combination.

  17. Jim Sachetti Says:

    The idiots in DC could do well to stop pushing the very expensive and extremely impractical EVs to the consumer who needs space and RANGE for long trips, and instead buy them for all kinds of GOV fleets, such as parking meter maid cars, as well as encourage the POST OFFICE to use them as mail carriers. Our cities air will be far more clean when a mail carrier, which idles half the day, is replaced by an EV, than when my big sedan, which only idles a few seconds every day and does only a handful of miles, is replaced by an EV.

    But the major drawback of the EV, much more than that of a hybrid, will be the very high price (first cost) compared to the tiny little POS you will be getting. The cost of the electricity will be peanuts, and actually it will be a hhuge advantage over gas, for the vast majority of commuters, who will charge their little EVs overnight at dirt-cheap rates (1/4th of the cost of gas) AND at off-peak hours, so the grid will easily handle it, esp since only a handful of these EVS will be sold any time soon.

  18. Merv Peters Says:

    Wow,a lot of responces today. You certainly have an involved audience. Good stuff.

  19. Kit Gerhart Says:

    I was just reminded of an ideal application for an EV, reading electric meters. For reasons beyond comprehension, my power company uses large pickup trucks to read meters. Yes, they are empty except for a driver and his electronic note pad. About any EV intended for volume sale should have enough range for a shift of meter reading.

  20. John Says:

    Hey Kit,

    Now there is cellular technology that reads the meter automatically.

    The meter says “Cellnet Data Systems” ….

    http://www.landisgyr.com/na//en/pub/index.cfm

    They can sell the EVs here:
    http://www.treehuggersofamerica.org/

    Where is Pedro ?

  21. John Says:

    Thank You for the “Autoline After Hours” discussion about Auto Racing last night.

    Peter has a great idea of returning to actual manufacturers bodies in competition.

    John McElroy, can you pose that question to NASCAR ? That would fill those empty seats!

    Also John, about the Kristen Helsel – Aerovironment battery charging interview.

    You know all those warning signs at the gas stations near the gas pumps that tell you to turn off your cell phone and all “battery powered” devices…

    see:
    http://www.chasingcleanair.com/photos/uncategorized/2008/10/29/dsc_0243.jpg

    How does the 100 amp quick charge get around the safety regulations from gas vapor explosion risk ?

    How would you like to be buying gas at a station when the 10,000 gallon gas delivery tanker is on site and one or more 100 amp “quick charge”(s) are taking place?

  22. Willi Says:

    gas pumps are dangerous enough as it is – no way

    if you can only afford one car, you better stick with the gas – you have to have two – one gaser for the long hauls, the ev for in town – problem is insurance, if the gaser is parked for periods, you need euro style insurance

    give me an electric that has a decent 1 liter engine behind it, it’ll kick in where needed, charge the batteries, and get me home when all else fails

  23. Alex Kovnat Says:

    Toyota’s plans to expand the Prius line are all well and good, but what about that patent infringement lawsuit they have on their hands? I hope it won’t be a showstopper.

  24. Willi Says:

    1899 Porsche electric vehicle … motor in wheel

  25. Kit Gerhart Says:

    John said:
    Now there is cellular technology that reads the meter automatically.

    The meter says “Cellnet Data Systems” ….

    I’m sure all the utilities will switch to that technology eventually, but mine in Indiana is a long way from that. They are getting their money’s worth out of my ~50 year old meter, though.

  26. John V Says:

    Fast charging could be a real opportunity for older filling stations facing the huge expense of replacing an old fuel tank. Many stations have gone out of business because they could not make a business case for a new tank with all the environmental precautions. Convenience stores currently lacking fuel filling could also add charging service. They just need space to add the additional electrical power hardware that may be needed to supply the charger(s).

  27. Kit Gerhart Says:

    With today’s battery technology, “fast charging” means an hour rather than 12 hours. No matter how much power is available to the plug, you can’t charge an electric car in 5 minutes. The type of fast charging that could actually exist would be for the time you have a leisurely dinner at a restaurant, or do a lot of shopping at a mall.