GM Savors A123Systems and Coskata Deals Amid Dreams of Clean Vehicles That Can’t Crash
When General Motors unveiled its lavish 330-acre, Eero Saarinen-designed technical center in 1956, company president Harlow Curtice cruised to the podium in a shark-finned, bubble-domed Firebird II gas turbine experimental car. “We must put more emphasis on basic research, pure research,” Curtice declared, later adding, “I hope you will come to regard the General Motors technical center in the same way I do—as one of the nation’s great resources—more important even than the natural resources with which we have been endowed.”
More than a half-century later, no one gushes about “pure” research at GM or virtually any other industry lab—competition is too fierce, the pressure to conduct R&D directly relevant to the core business too intense. But that doesn’t mean the nation’s biggest carmaker doesn’t nurture big dreams about the future of vehicles, which run from hydrogen-powered cars to environmentally friendly vehicles that never crash. And it turns out that those dreams have some strong New England connections. So when president of GM North America Troy Clarke came to town yesterday, I asked him about the company’s vision for the future, and how two deals with local roots—its big investments in Watertown, MA’s A123Systems and in Coskata, an Illinois biofuels company backed by Waltham, MA-based Advanced Technology Ventures—fit in. That’s when he started waxing on about new types of batteries and cars that run on your trash.
“In some regards in the auto industry, and I don’t mean to be melodramatic, we’re at the beginning of time again,” Clarke told me. “There’s more technology opportunities than I think there have been since the industry started a hundred years ago.”
He was speaking primarily about the forces at work around climate change, the cost of petroleum-based fuels, and energy security. And he posed the problem, “How much can we afford to invest in infrastructure for personal transportation, and what are the costs of that?”
An unexpectedly introspective question, perhaps, from the man in charge of GM’s North American operations. But it’s probably good news that despite the pressures of the day, GM is spending some time looking ahead 50 years or more. And the automaker has plenty of projects on all these fronts, work I couldn’t sum up in a short article. But its hydrogen-powered fuel cell activity, to take just one example, is evidenced in Project Driveway, an effort announced last fall to put a test fleet of 100 cars with hydrogen fuel cells on the roads (85 of these have already been deployed, Clarke says). And Clarke spoke pretty passionately about the company’s farther-out visions, which include lightweight and fuel-efficient cars that are also safe (you can make lightweight cars now out of exotic and costly materials, Clarke says, but not only are they expensive, they don’t pass crash tests).
The solution, says Clarke: “I just have to make sure the vehicle doesn’t crash.” He sketched out a future of networked roadways and cars that talk to each other, with vehicle override systems taking control when needed. For those who might not like the idea of a car taking control of its owner, he points out that vehicles like the Chevrolet Corvette already have override systems that help owners drive much better in tough conditions. “Could you [make] a vehicle that couldn’t run into something? Yeah, I think you could,” Clarke says.
To that end, GM has been sponsoring work at places like Carnegie Mellon University, where it teamed up with the school’s engineers and computer scientists to enter an autonomous vehicle in DARPA’s Urban Challenge last fall.
But a road system without crashes is probably many decades away—and I wanted to know about some local investments poised to lead to commercial products much sooner. The first was GM’s contract with A123Systems, announced last August. Under the deal, the Watertown company will co-develop the lithium-ion battery for the GM E-Flex electric vehicle architecture, which is the basis for the planned Chevrolet Volt electric car. The companies haven’t revealed the exact terms of the deal. But Ric Fulop, an A123 founder and vice president of business development, told me at the time: “It’s a significant deal…We are working together with GM to develop a very special product for the Volt.”
Clarke says it’s fair to see the A123 deal as a step toward GM’s larger vision of environmentally friendly cars. “We definitely have a vision toward the electrification of the automobile,” says Clarke. “Removing the automobile from the…imported oil, the climate change equation—I think that nothing short of that should be our goal, and that’s the journey we’re embarking on.” Fifteen years or so ago, electric cars used lead acid batteries. There has been an evolutionary change in battery technology since then, Clarke points out, leading to the lithium ion batteries A123 makes. “It would appear that this is the real deal this time,” he says, painting a picture of all-electric cars with 100-plus-mile ranges instead of today’s 40 miles or so. “The Volt’s a big deal for us,” he says.
Next we talked about Coskata, a Warrenville, IL-based company that says it has found an affordable way to make ethanol from almost any hydrocarbon-rich material, from wood chips to demolition waste to grass. Advanced Technology Ventures set up Coskata’s top-secret Series A funding round in 2006, along with Khosla Ventures of Menlo Park, CA, and GreatPoint Ventures. Wade did a great interview with ATV’s Bill Wiberg on the company in January, when GM used the Detroit Auto Show to announce it had entered into a research and development partnership with Coskata and had also taken an undisclosed stake in the company.
“The allure of biofuels is so great that it’s worthy of debate, consideration, and some concerted level of thought,” Clarke says. As Wade’s article also pointed out, so much corn is already being diverted into ethanol production that it’s raising the cost of food. And it takes almost as much energy to grow the corn and process it into ethanol as the ethanol itself gives back when burned.
“Let’s assume you could make [ethanol] out of something else—that’s where Coskata comes in,” says Clarke. “It was a lab setup when we first saw it,” he says of the company. GM had the work verified at Argonne National Lab, he says, “and chose to make investment in it.”
If Coskata’s technology works on an industrial scale, it could produce ethanol for around $1 per gallon, which inspires Clarke to muse about the possible future. “Wouldn’t it be great to have a fuel [where] the main cause of inflation was the price of garbage?” he says. “Chain your garbage to the curb so that people don’t come by and lift it.”
American research and educational institutions have the know-how needed to bring about this future, Clarke thinks. “We are world leaders in this type of microbiology,” he says. “That’s a game changer.”
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