GM To Produce Beat, Lutz Talks about PHEV Cars

By Brendan Moore


GM held a press conference here to announce a few things and I was able penetrate to the scrum around Bob Lutz in order to ask him a few questions pertaining to GM’s PHEV (plug-In hybrid vehicle) program, but first, the things that GM told everyone:

GM made the case for themselves as a car company that cares about the environment and cars about fuel economy in no uncertain terms. It was obvious from the remarks offered up by several GM executives that there was some measure of resentment towards the media regarding what they felt was misrepresentation of their stance towards both the environment and fuel economy. The frustration the folks at GM have concerning their perception of unfairness vis-à-vis what they do, and say, what Toyota does, is palpable.

A tie-up with Disney was announced whereby the first fuel-cell vehicles made by GM will be driven around Disneyland/Disneyworld so that the public can experience same.

Bob Lutz of GM announced that the Chevrolet Beat, one of the three urban concept cars shown by GM at the New York Auto Show, would definitely be produced in Korea in 2009. Lutz then wisecracked that the Beat was the one GM wanted all along, so it was good that democracy subsequently approved their internal choice, and then added, sotto voice, it took a lot of GM employees voting online to ensure the result. And then, of course, “just kidding, that didn’t happen”. Lutz added almost as an afterthought that the voting was so close between the Beat and the Traxx concepts that GM may just make both.

I asked Bob Lutz three questions after the presentation when he took questions from the journalists present:

Is Senator Hillary Clinton’s proposal last week to provide over $20 billion in monetary assistance to produce alternative energy vehicles meaningful to GM?

No, not really, because she stated it was for re-tooling. We don’t need to re-tool, the costs we have are research, development, engineering, etc. Now, of course, we’ll take any money we can get from the government, but a 6 or 7 thousand dollar tax credit for the PHEV would be a lot more effective from our point of view. She’s a smart lady but she got that wrong.

Would you consider the $20 billion to be meaningful if it was set aside for the tax credits for PHEVs as you suggest?

Yes, that would be very effective. We would like to see some incentives for people to change their cars.

I’m sure you’re familiar with the report from the Department of Energy that stated that the existing utility grid in the U.S. could accommodate approximately 140 million plug-in hybrids right now (our reporter was dizzy from all the new iron around him – the actual number stated by the DOE in the report was 180 million). Has GM been in contact with the DOE or any of the utility companies regarding this conclusion?

No, although our research gives a smaller number than the DOE report, but it’s still a pretty big number. That’s the great thing about the Volt or an EV, it runs on something that is cheap and readily available in this country, doesn’t require pumps, pipelines, you know? It’s an even better situation in other countries like France; they have nuclear power that supplies cheap electricity, and if we had that here, we sure wouldn’t need much gasoline or imported oil for cars.

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at

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  1. GM’s public perception problem can be traced back to. . .GM!

    They have never shown a lot of concern in either of those two areas, so is it a surprise that people are skeptical now when they suddenly do an about-face?

  2. I applaud GM for tackling the issue head-on, and also for doing so much in the way of tangible efforts to solve both problems. I think the average American really has no clue just how much GM is doing to reduce foreign oil consumption and pollution. Yes, it’s true that they still make far too many gas-drinking monsters, but, my goodness, they’re doing a good job with hybrids and their new small cars!

  3. He’s right about nuclear power. Time to take another look at that technology.

  4. I guess GM wants to see if will sell in the markets already used to that size car, but I think they should make the Beat available here at the same time everywhere else and then see if the market repsones warrants a second minicar. BTW, didn’t Honda have a car called the Beat at one point that they sold only in Japan? Don’t they own that model name?

  5. Lutz wants a big tax credit for a plug-in vehicle and if GM has the only plug-in available for a couple of years, that works out pretty well for GM, huh?

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