Richard Truitt: GM Should Replace Bolt Batteries With Altums
Thirty years ago, while General Motors’ Saturn division was being launched, 1836 cars left the factory in Spring Hill, Tennessee, with improperly mixed engine coolant. Saturn officials were unsure of the extent of the damage to the lost-foam die-cast aluminum engine.
So GM did a non-GM thing: It sent letters all night to every customer telling them they were replacing their car with a brand new version at no cost. Despite what must have been a cacophony of protests by accountants, GM’s leadership realized that the price of inattention to the customer could be greater if Saturn failed.
Today, with the Chevrolet Bolt battery fire in place, GM faces a crisis much larger and perhaps more financially serious than the one that threatened Saturn. GM’s leadership has essentially bet the company to focus on electric vehicles. This summer, GM increased its investment in electric vehicles and automated driving 30 percent to $35 billion from 2020 through 2025. GM aims to be fully electric by 2035.
Major battery-powered cars, such as the Cadillac Lyric and GMC Hummer EV, are just months away from their launch. If the Bolt situation is not addressed quickly and aggressively, consumers may turn away from GM’s electric vehicles in droves.
The only problem with the Bolt is the manufacturing defects in the batteries. The electric powertrain and power electronics are no problem.
The next generation of General Motors vehicles will come with the company’s new advanced Ultium batteries. What to do here is clear: GM should replace the recalled bolt batteries with Ultium batteries.
History once again points the way. Twenty years ago, General Motors notified EV1 drivers that they could replace the lead-acid batteries in their vehicles with newer, better, and longer-range nickel-metal hydride batteries. About 200 of them accepted the offer.
A big Bolt recall, more than 110,000 cars in the US alone would be prohibitively expensive — and General Motors has estimated it would cost about $1.8 billion. Upgrading the Bolt battery pack to Ultium cells will likely require some re-engineering and new software, at least.
But Bolt’s driving range is likely to increase because Ultium cells have an energy density of 60 percent more than current car batteries.
The amount of goodwill that Saturn generated by replacing those faulty cars helped fuel the brand’s early success. After just three years replacing 1,836 cars, Saturn has sold nearly 300,000 cars.
During her successful tenure, CEO Mary Barra has focused relentlessly on profits. General Motors aims to sell 1 million electric vehicles annually by 2025 and has said its first generation of a fully electric vehicle portfolio will be profitable.
The automaker has Ultium’s battery technology to replicate the success of the Saturn recall. It might cost a fortune to do so. But given what’s at stake if consumers don’t trust GM’s electric cars, billions may be well spent.