The Auto Writer

General Motors has staked its future on small cars, realizing that an electric car like the Chevrolet Volt and a fuel efficient gas-sipper like the Chevrolet Cruze is the direction the automaker needs to take if it is going to be successful. Right now, the automaker is struggling to raise cash in a bid to keep going, pouring money into new projects that the company hopes will help GM to prosper.

Two years from now a new model is expected to be released, the electric 2011 Chevrolet Volt. This car will be a different kind of hybrid model, running chiefly on battery power before a small, gas engine kicks in to extend the car’s range. The technology the company is using is a lithium-ion battery, something currently used in a wide variety of consumer products, including laptops.

GM believes that a larger version of the battery will work in the Volt and has been in discussions with a pair of companies — LG Chem of South Korea and Continental AG of Germany — to outfit the Volt.

LG Chem To Be Selected

Well, the time to select a battery manufacturer has arrived and GM has apparently named the winner. Though the announcement hasn’t been officially made just yet, it is believed that LG Chem will supply the $10,000 per car battery pack. That announcement will come closer to when the Los Angeles Auto Show opens on November 21st, perhaps during the Press Days when the Chevrolet Volt makes its debut.

The price of the Volt’s battery pack will likely push the car up to around $40,000, clearly well above what GM had hoped the car would retail for just a year ago. However, the federal government has already said that Volt owners will receive a generous tax break of $7500 per vehicle.

Ten Thousand Units To Start

When the Volt goes into production, GM expects to produce about 10,000 units in the first year, but ultimately 60,000 annually when production ramps up. At the same time, GM may use the Volt platform to build a variety of other vehicles for its many divisions, further expanding its electric car line up.

Though Continental AG isn’t the likely winner, GM will maintain a relationship with that company especially as demand increases for its unique electric car.  Having a capable second source for supply lithium-ion battery packs is wise, as the automaker may need to suddenly ramp up production if consumer demand is strong.

(Source: Motor Trend)