The Tale of Three Detroit Electric Car Programs

By · November 10, 2009

Chrysler is killing its dedicated electric car program. General Motors is moving forward with its sleek electric-drive Caddy. What do these news flashes tell us about Detroit’s prospects in the bold new era of EVs and plug-in hybrids?

Short Circuit

Dodge Circuit

The all-electric Dodge Circuit helped Chrysler get government grants and federal bailout money. The company's new leadership has a dim view of electric cars.

On Friday, Chrysler Spokesman Nick Cappa said that its in-house team of electric car development engineers had been disbanded and will be folded into the company’s org chart. This announcement comes three months after Chrysler took $70 million in grants from the US Department of Energy to develop a test fleet of 220 hybrid pickup trucks and minivans. It comes less than year after Chrysler built its case for federal aid—it received $12.5 billion—by showing flashy designs of electric sports cars, trucks and vans, and promising 500,000 battery-powered vehicles on the road by 2013.

With a swipe of his wrist, Fiat CEO Sergio Marchionne cast aside Chrysler’s EV plans—commenting that batteries aren’t ready, the market is minuscule, and “electric vehicles are going to struggle.” In doing so, he followed in the footsteps of other US and European carmakers that have dismissed the inexorable movement of the auto industry toward greener more fuel-efficient electric and hybrid cars. Chrysler is now left with an obligation to put those 220 test hybrids on the road—which it will honor—and an anemic effort to market a Dodge Ram Hybrid, which will dribble out next year after five years’ worth of promises that the vehicle is coming. In an era when green is the new black, the breakup of the company’s hybrid and electric car team is a public relations blunder.

Harmonic Convergence

Bob Lutz in the Cadillac Converj

Bob Lutz, product chief turned marketing chief at GM, sits in the Cadillac Converj. If the vehicle moves forward, it could draw attention to the Cadillac brand, but like GM's current hybrids, production volume would be insignificant.

General Motors, on the other hand, knows about such blunders—but has learned the lesson too well.

After the infamous killing of the EV1, and years of dismissing hybrids as “making no economic sense,” the company is now using its forthcoming star car, the Chevy Volt, as a poster child for all things green and good. GM’s Volt program is tremendous and deserves due recognition as a major achievement. Kudos. Yet, the company continues to turn up the brightness of the klieg lights—now reaching a blinding level. For example, GM’s recent national Volt advertising campaign—promising 230 miles to the gallon—does more to obfuscate than to elucidated.

The publicity is working. The latest example is this week’s story in the Detroit News that the company has given a green light to produce the Cadillac Converj, a slick electric coupe unveiled in concept form at the 2009 Detroit Auto Show. As cool as the car looks, the news flash—picked up by major media outlets and the blogosphere alike—is all about marketing. "Cadillac needs as much excitement in its portfolio as possible, so I think it's a good strategy for them," Rebecca Lindland, director of auto industry research at IHS Global Insight, told Detroit News. Bingo.

It’s a great strategy for drawing attention to the sagging Cadillac brand. But if the goal of the hybrid and electric car movement is to offer low- or zero-emission transportation, and to make a transition to sustainable personal vehicles, the Cadillac Converj is as wrong as the spelling of its name. The current luxury hybrids on the market are low sellers. The $70,000 Cadillac Escalade Hybrid has sold an average of about 160 units per month this year. Why would a more expensive, less practical two-door Cadillac Converj, even with great lines and 40 miles of all-electric range—sell at much greater numbers? Low production numbers also undermine arguments from Bob Lutz, now serving as marketing chief for GM, that the Converj will help the Volt program reach economies of scale or defray battery costs.

That doesn’t matter. Nor does it matter that Cadillac has not confirmed the Converj story. Mission accomplished for GM PR. Nothing accomplished for sustainable mobility.

Is There Another Way?

Wouldn’t it be cool if there were a Detroit auto company that saw the value of electric-drive vehicles (unlike Chrysler), and (unlike GM) was modestly going about producing common sense, affordable electric cars and plug-in hybrids on existing global scalable platforms? Maybe something like an electric version of a practical mild-mannered Ford Focus, or a plug-in hybrid variant of a small crossover Escape? No super fanfare. No rumors of slick expensive future EVs that may or may not come. No Hail Mary passes. No bloated promises for handouts from American taxpayers.

Once again, Ford is proving that it’s moving in the right direction—not only for consumer value and profitability, but for the future of Detroit, the US economy, and Planet Earth.

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