GM Rethinks Hydrogen Fuel Cells

Firm shifting to hybrid electric vehicle development.

Published: 31-Dec-2002

DETROIT — General Motors, which had been focusing on hydrogen power for alternative fuel vehicles, now plans to sell 1 million cars, pickups and sport-utility vehicles powered by gas/electric hybrid engines by mid-decade.

GM had fought making heavy investments in hybrid technology, saying it would have cars and trucks powered by hydrogen fuel cells in driveways after 2010.

But technological stumbling blocks and competitive pressures have forced GM to rethink its plans.

The fuel cells combine hydrogen and oxygen to produce energy without the pollution of gasoline. Hybrids combine an internal combustion engine and an electric motor to deliver high fuel economy and ultralow emissions.

In a hybrid, the gas engine recharges the electric motor, so no additional infrastructure is needed. But fuel cells will require service stations that can provide the hydrogen. That will take longer to establish than automakers thought in part because oil companies aren't rushing to invest in hydrogen technology at their stations until they are sure vehicles will be produced in large numbers.

Besides that, GM soon will be up against a slew of hybrid cars and SUVs from competitors. If it's out there alone without hybrids while waiting a decade for hydrogen power to develop, GM likely would become a whipping boy for regulators and environmentalists.

Currently, Toyota Prius and Honda Civic and Insight are the only hybrid vehicles available. But others are on the way:

GM is expected to announce that it will offer hybrid versions of its Chevrolet Silverado and GMC Sierra pickups, Saturn Vue and Chevrolet Equinox small SUVs, and Chevrolet Malibu sedan by 2005. The system in the Malibu can be transferred to other GM cars built off the same engineering architecture. And it turns any vehicle into all-wheel drive.

The Vue and Equinox system will raise fuel economy to 40 miles a gallon from 25, GM says.

The system on Silverado and Sierra uses an electric motor to accelerate and decelerate and to power the trucks at idle, increasing fuel economy by 15% to 20% in most cases.

J.D. Power and Associates estimates that hybrid sales will climb from 40,000 this year to 500,000 by 2006, when five automakers are selling them. In a survey of 5,200 new car buyers, Power found that 60% would "definitely" or "strongly" consider buying a hybrid.

"Consumers think hybrids are great," says Anne Hanson, an Ann Arbor, Mich., marketing consultant and former marketing chief with Ford's electric vehicle program. She says GM and Ford are right to be concerned about Toyota and Honda stepping up their hybrid offerings over the next decade.

GM says it has figured out how to make hybrids less expensively than it thought as recently as two years ago. At that time, the extra cost per vehicle neared $10,000.

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