Wagoner to investors: Battery research a 'top priority' for General Motors
Tuesday, June 05, 2007
Wagoner to investors: Battery research a 'top priority' for General Motors
Sharon Terlep / The Detroit News
General Motors Corp. Chairman Rick Wagoner told investors today that the automaker has signed two suppliers to develop advanced battery technology for the Chevy Volt's E-Flex system.
GM is in a race with Asian rivals to develop an affordable battery with sufficient lasting power -- a development critical to automaker's efforts to build an electric vehicle.
In January, GM announced plans to build the Volt electric vehicle, which would be powered by a lithium ion battery. The company is developing a system for the Volt called E-Flex, which matches battery power with several different energy sources.
The challenge is to create a battery that can recharge quickly, last long stretches of time and not overheat, while being small and cost-effective enough to sell on the mass market.
"Given the huge potential that the Volt and its E-Flex system offers to lower oil consumption, lower oil imports and reduce carbon gas emissions, this is for sure a top priority program for GM," Wagoner said.
The two new technology suppliers are Troy-based Compact Power Inc. and Continental Automotive Systems, a subsidiary of Continental AG. They were picked from a field of 13 contenders.
Compact Power will launch a yearlong development program that aims to have a battery pack ready for an in-car test by next summer, the company said in a statement.
In addition to the Volt, GM is developing a number of battery-powered hybrid systems, including a plug-in Saturn Vue hybrid and a system for full-size SUVs.
GM's annual meeting got under way shortly before 9 a.m. today at the Hotel du Pont in Wilmington, Del.
Wagoner, in his speech, outlined priorities for GM in 2007:
*A labor deal with the United Auto Workers union will be key, as will resolving negotiations with bankrupt part supplier Delphi Corp. Tackling GM's suffocating health care costs, which last year amounted to $4.8 billion, is also critical, Wagoner said.
*GM will continue to focus on its businesses outside the United States, which last year accounted for more than 60 percent of the company's global sales. The company also will work to further integrate its global operations, cutting costs by adopting uniform standards throughout its worldwide operations.
*Finally, Wagoner said, GM will focus on developing advanced fuel technology to will reduce vehicle dependence on fossil fuels with programs such as the E-Flex system.
"It's not about short-term initiatives to react to short-term challenges," he said. "We're taking the profound actions necessary to transform the company for the long haul."
Wagoner has responded good-naturedly to barbs -- and some name-calling -- from a few activist shareholders, several of who have already spoken on a number of issues. He has listened even as speakers surpassed their two-minute time limits, talking through the loud bell that indicates their turn is up.
One longtime activist shareholder, Evelyn Davis of Washington, D.C., labeled Wagoner and executives "accounting flunkies." She then announced that even though she is a Republican, she plans to vote for Hillary Clinton.
"I'm sure Senator Clinton will be happy to hear that," said Wagoner, who also clarified that his degree isn't in accounting, as Davis had said.
Following Wagoner's speech, executives began addressing questions from shareholders, including a core group of company critics who make annual trips to the shareholders' meetings.
Fritz Henderson, GM's chief financial officer, spoke to criticism over faulty accounting practices that have forced GM to restate financial results for several years and resulted in an investigation by the Securities and Exchange Commission.
"We're not at all proud of that," Henderson said of the restatements.
To address the problems, Henderson said, GM has brought in a new controller, a new chief accountant and added more than 30 people to its accounting staff.
Shareholders again voted down a proposal that would have forced GM to reduce its emissions by a set amount. The board of directors had opposed that measure as well, arguing that the automaker already is working hard to make its vehicles cleaner and more environmentally friendly.
As is typically the case, each of the shareholder proposals that came up for a vote failed, most by wide margins. The most popular proposal, which would have given shareholders the authority to call special meetings with GM leadership, received 41 percent support with 55 percent of shareholders voting no and 3 percent abstaining.
Analysts had predicted a more upbeat tone at this year's gathering compared to last year, when the automaker was facing shareholder ire about its $10.4 billion 2005 loss and continuing to founder amid oceans of red ink. GM posted a $2 billion loss for 2006.
Since late 2005, GM has trimmed more than $7 billion in yearly expenses and cut 34,000 hourly workers. It posted a $62 million profit in the first quarter of 2007, despite an $85 million loss for its North American business.
Come back to www.detnews.com all morning for continuing updates from the meeting room floor.
© Copyright 2007 The Detroit News. All rights reserved.
Wagoner to investors: Battery research a 'top priority' for General Motors
Sharon Terlep / The Detroit News
General Motors Corp. Chairman Rick Wagoner told investors today that the automaker has signed two suppliers to develop advanced battery technology for the Chevy Volt's E-Flex system.
GM is in a race with Asian rivals to develop an affordable battery with sufficient lasting power -- a development critical to automaker's efforts to build an electric vehicle.
In January, GM announced plans to build the Volt electric vehicle, which would be powered by a lithium ion battery. The company is developing a system for the Volt called E-Flex, which matches battery power with several different energy sources.
The challenge is to create a battery that can recharge quickly, last long stretches of time and not overheat, while being small and cost-effective enough to sell on the mass market.
"Given the huge potential that the Volt and its E-Flex system offers to lower oil consumption, lower oil imports and reduce carbon gas emissions, this is for sure a top priority program for GM," Wagoner said.
The two new technology suppliers are Troy-based Compact Power Inc. and Continental Automotive Systems, a subsidiary of Continental AG. They were picked from a field of 13 contenders.
Compact Power will launch a yearlong development program that aims to have a battery pack ready for an in-car test by next summer, the company said in a statement.
In addition to the Volt, GM is developing a number of battery-powered hybrid systems, including a plug-in Saturn Vue hybrid and a system for full-size SUVs.
GM's annual meeting got under way shortly before 9 a.m. today at the Hotel du Pont in Wilmington, Del.
Wagoner, in his speech, outlined priorities for GM in 2007:
*A labor deal with the United Auto Workers union will be key, as will resolving negotiations with bankrupt part supplier Delphi Corp. Tackling GM's suffocating health care costs, which last year amounted to $4.8 billion, is also critical, Wagoner said.
*GM will continue to focus on its businesses outside the United States, which last year accounted for more than 60 percent of the company's global sales. The company also will work to further integrate its global operations, cutting costs by adopting uniform standards throughout its worldwide operations.
*Finally, Wagoner said, GM will focus on developing advanced fuel technology to will reduce vehicle dependence on fossil fuels with programs such as the E-Flex system.
"It's not about short-term initiatives to react to short-term challenges," he said. "We're taking the profound actions necessary to transform the company for the long haul."
Wagoner has responded good-naturedly to barbs -- and some name-calling -- from a few activist shareholders, several of who have already spoken on a number of issues. He has listened even as speakers surpassed their two-minute time limits, talking through the loud bell that indicates their turn is up.
One longtime activist shareholder, Evelyn Davis of Washington, D.C., labeled Wagoner and executives "accounting flunkies." She then announced that even though she is a Republican, she plans to vote for Hillary Clinton.
"I'm sure Senator Clinton will be happy to hear that," said Wagoner, who also clarified that his degree isn't in accounting, as Davis had said.
Following Wagoner's speech, executives began addressing questions from shareholders, including a core group of company critics who make annual trips to the shareholders' meetings.
Fritz Henderson, GM's chief financial officer, spoke to criticism over faulty accounting practices that have forced GM to restate financial results for several years and resulted in an investigation by the Securities and Exchange Commission.
"We're not at all proud of that," Henderson said of the restatements.
To address the problems, Henderson said, GM has brought in a new controller, a new chief accountant and added more than 30 people to its accounting staff.
Shareholders again voted down a proposal that would have forced GM to reduce its emissions by a set amount. The board of directors had opposed that measure as well, arguing that the automaker already is working hard to make its vehicles cleaner and more environmentally friendly.
As is typically the case, each of the shareholder proposals that came up for a vote failed, most by wide margins. The most popular proposal, which would have given shareholders the authority to call special meetings with GM leadership, received 41 percent support with 55 percent of shareholders voting no and 3 percent abstaining.
Analysts had predicted a more upbeat tone at this year's gathering compared to last year, when the automaker was facing shareholder ire about its $10.4 billion 2005 loss and continuing to founder amid oceans of red ink. GM posted a $2 billion loss for 2006.
Since late 2005, GM has trimmed more than $7 billion in yearly expenses and cut 34,000 hourly workers. It posted a $62 million profit in the first quarter of 2007, despite an $85 million loss for its North American business.
Come back to www.detnews.com all morning for continuing updates from the meeting room floor.
© Copyright 2007 The Detroit News. All rights reserved.
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