GM: Battery glitch cuts hybrid sales

2008 Saturn Vue hybrid: Launch was slowed.
DETROIT — With gasoline at $4 a gallon and the Toyota Prius flying out dealership doors, General Motors' mild hybrid vehicles are stuck in neutral because of battery-pack failures.

GM had to use 9,000 battery packs to replace leaking ones it recalled, a company spokesman says. GM diverted those batteries from new hybrids for sale this year.

GM planned to sell about 27,000 mild hybrid vehicles this year, possibly more given the sharp rise in gasoline prices. But insiders say GM will fall far short of that goal because of problems with its Michigan-based battery maker, Cobasys, a joint venture of Chevron Technology Ventures and Energy Conversion Devices.

GM discovered an internal leak in the nickel-metal hydride batteries that Cobasys made for GM's 2007 model hybrids. The leak caused the hybrid powertrain to shut down. The vehicles could still be driven, but not with the hybrid system.

The vehicles affected were the 2007 Saturn Vue Green Line and Saturn Aura Green Line hybrids. A GM spokesman says the company recalled about 9,000 vehicles to replace battery packs. That slowed the launch of the 2008 Saturn hybrids and the new Chevrolet Malibu Hybrid.

Slow sales
GMs April sales of mild hybrid vehicles
Chevrolet Malibu Hybrid260N/A*
Saturn Aura Green Line6542
Saturn Vue Green Line304954
*GM did not sell a Malibu Hybrid before the 2008 model year.
Source: General Motors

Custom-built batteries

Cobasys' batteries are specifically designed for GM's mild hybrid system. That means GM cannot switch suppliers until it brings out the next generation of mild hybrids in 2010, a source familiar with GM hybrid engineering said.

GM initiated the recall in late December when it began receiving reports of battery failures. Cobasys halted production for at least a month while it fixed the problem and revalidated the batteries, a GM source familiar with the mild hybrid program said.

"I don't know how many hybrids we could have sold, but we would have had at least 9,000 more batteries for the pipeline," GM spokesman Tom Wilkinson said. "It's not an insignificant number, but it's also part of what happens with a brand-new technology."

Repeated calls and e-mails to Cobasys were unreturned. But a person who answered the phone at the company's Springboro, Ohio, plant said production had resumed. And the GM source said the automaker is now getting the batteries it ordered.

The mild hybrid system sells for a premium of less than $2,000. Unlike a full hybrid, the mild system doesn't propel the vehicle on electric power alone. Instead, it acts as a stop-start system and provides a boost when the vehicle is accelerating.

Saturn suffers

Sales of the 2008 Vue Green Line suffered because of the battery shortage, Saturn spokesman Steve Janisse said.

Through April, retail sales of the Vue Green Line were just 326 units, compared with 2,683 retail sales during the same period a year ago, he said. Part of the difference is that GM had put incentives on the 2007 hybrids, which were at the end of the previous generation. Now, Saturn's interim goal while ramping back up is about 250 retail Vue Green Line sales a month, Janisse said. Through May 27, he said, it had sold 222 units retail in May.

"We're feeling we're closer to where we want to be," Janisse said.

Saturn sold only 69 retail units of the 2008 Aura Green Line through April because of the battery problem, Janisse said. Saturn launched the Aura Green Line in March 2007 and sold 48 units at retail through April 2007.

The battery problems also likely hurt sales of the 2008 Malibu Hybrid, Chevrolet spokeswoman Nancy Libby said.

In April, GM sold 17,050 Malibus. GM says it sold 260 Malibu Hybrids in April — well below GM's 10 percent target.

GM starts production of the 2009 Malibu Hybrid on June 23. Libby said that by that time, the battery supply problem should be resolved.

You can reach Jamie LaReau at (Unknown address)

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