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Another way to save money will be to create battery manufacturing in the United States. Posawatz said that GM has to spend hundreds of dollars per battery pack just for shipping the cells that make up the pack from overseas suppliers. Funds in the recent federal stimulus package passed in February and other legislation could help bring such battery cell manufacturing to the United States.

Posawatz said that GM has been talking with utilities about the possibility of a market for the batteries after their useful life in the car is over. The batteries are designed to last 10 years in a car, at which time they may store only three-quarters of their original capacity and the car may no longer get its full 40-mile electric range. But he said that the battery could still be useful for another 10 years for storing electricity for utilities. It could, for example, store energy from wind turbines during the night for use when there is demand for power during the day. If utilities agreed to buy the batteries, that could lead to financing arrangements that take this into account and lower the cost of the car, according to Felix Kramer, founder of CalCars, a nonprofit organization that promotes plug-in hybrids.

GM is also working with local governments to create incentives that may make more people interested in buying the car. These could include preferential parking, access to car-pool lanes, and publicly available charging stations. In some cases, utilities may offer free services to install dedicated outlets–like the dedicated outlets for clothes dryers or ovens–to allow for fast charging. San Francisco is working on codes that would require new buildings to be equipped for such circuits. GM already has the benefit of a big incentive from the federal stimulus package, which provides a $7,500 tax credit for buying cars such as the Volt.

Such efforts to create incentives could be important because ultimately, what will make the vehicle more affordable is increasing the scale of production, Posawatz said, which will attract more suppliers, creating competition and driving down costs. He expects that the costs for battery chargers, for example, which don’t require very complex technology, could fall by two-thirds if there were more qualified suppliers.

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Credit: GM

Tagged: Business, Energy, battery, electric cars, Obama, GM, Volt, plug-in hybrid, hybrids, plug-in vehicles

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