1. What does the Chevy Volt case tell you about the nature of strategic decision-making at a large complex organization like GM? The Chevy Volt case indicates that strategic decision making at a large company like General Motors often does not take time to consider all the angles or facts that may influence the decision. In a large corporation, many different sets of information are held by different departments. Perhaps some information from the engineering department may suggest that the Volt is not a wise investment, as the previous fuel cell model, which is also an alternative energy vehicle, was not a success.
However, all the facts surrounding the failure of the EV1 may not be available to those making the decision. It was also determined that making a large Lithium Ion battery was difficult, though nobody said it was impossible. Perhaps that statement was one department manager or engineer's opinion, not the general consensus. 2. What trends in the external environment favored the pursuit of the Chevy Volt project? There are a number of trends from external environment that encourage the Chevy volt project to occur.
Sharply increasing of oil prices driven by growing demand in developed countries forces people to find cheaper alternative fuel or more fuel efficient cars. With increasing concern on global warming, people are interested in cleaner energy that can substitute the traditional fuel, which is the cause of greenhouses gases. The improvement in technology allowed the lithium ion batteries to be affordable by consumers and being more efficiency. Finally, electric cars or hybrids are already on the market and some of them were proved to gain attention from consumers such as Totota Prius.
3. What impediments to pursuing this project do you think existed within GM? Impediments that existed at GM, which may prevent the Chevy Volt project from being pursued, are lack of vision and lack of knowledge in Lithium Ion technology used to power a vehicle. So far, GM had only developed fuel cells, but not yet on lithium ion batteries. To acquire and retain this new technology, it means another huge investment that cannot be guaranteed success. This may not worth considering current financial situation of GM.
Another impediment for GM might also be fear of failure and its related costs, with the failure of one alternative energy vehicle already failing. The risk involved may be considered too great. In addition, the approach or intent in making the vehicle may not be favorable for American consumers. 4. The plan for the Chevy Volt seems to be based partly on the assumption that oil prices would remain high, and yet in late 2008, oil prices collapsed in the wake of a sharp global economic slowdown. a.
What does this tell you about the nature of strategic plans? This case tells me that a set of static carefully thought-out strategic plans will not allow the organization to survive along this uncertainty, complexity, and ambiguity world. Only a small-occurred event can have a large and unpredictable impact on outcomes. The organization must be able to respond quickly to changing circumstances and to alter the strategic plan accordingly. In this case, one reason that brought attention of consumers to alternative fuel car was the increasing in oil prices.
With falling down of oil prices due to economic slowdown in 2008, the organization might need an emergent strategic plan aside from its normal plans to maintain the sales and revenue. b. What do falling oil prices mean for the potential success of the Chevy Volt? With falling in prices, consumers can pay the same amount for more amount of fuel for the car. This collapsing of oil prices will relieve the tense in fuel consumption of consumers. They may turn back to gas guzzling car type and slow down the demand for electric cars and small cars. Consequently, the succeed sales of Chevy Volt, an electric car, might be affected by this incident.
c. Do you think oil prices will remain low? I think that oil prices will remain low for a while. When the global economic starts to recovery, demand for oil consumption will rise again. This increasing in oil demand results in higher oil prices. Beside the demand side, oil prices are also being determined by its supply. If capacity of oil production is reduced by any reasons, this will drive the oil prices up in no time. 5. What will it take for the Chevy Volt to be a successful car? In light of your analysis, how risky do you think this venture is for GM? What are the costs of failure?
What are the costs of not pursuing the project? For Chevy Volt to be a successful car, it must provide the same benefits as those alternative energy cars already on the market, such as the Toyota Prius. It must offer the same standard features, with similar quality. In addition, it must be priced as an affordable alternative. Plan of Chevy Volt’s market introduction in 2010 seems to be lagged behind its competitors a lot. Moreover the price tag of Chevy Volt, $30,000 – 40,000, is very expensive comparing to already available models from competitors in the market.
In my opinion, risky of this venture for GM is quite high and the cost of this project’s failure can be implied as a bankruptcy situation of GM. However, if GM does not seize the opportunity to produce a similar vehicle, the cost of not pursuing this is to lose a large portion of market share in the automobile industry, as more consumers show interest in this type of vehicle. Other companies such as Toyota and Ford Motor Company have already introduced their versions of alternative energy vehicles. The cost of failure then may mean losing substantial market share in the automobile industry.
Published on January 31st, 2017 | by Steve Bakker
I Drove A Bolt Today
January 31st, 2017 by Steve Bakker
Earlier in the month I posted an essay entitled “A Guy Walks into a Chevy Dealership“ which annotated the experience of contacting a number of California dealers to get a read on how they were responding to the now-in-production Bolt EV. The surprising-to-some result was that, on balance, the second iteration of a pure electric car from GM is being well received.
In what could be deemed part II of that article, the same guy (me again) walked into another dealership, this time one containing a real live Bolt available for a test drive. This was in the central California city of Monterey, nearly a golf ball’s throw from famous Pebble Beach golf course. I had been driving up Hwy 101 past the predominantly agricultural city of Salinas and on a spur of the moment urge had phoned the local dealer about their inventory. The citizens of Salinas had purchased two Bolts from the dealer, who had no plans to keep a demo model on hand. It was a rather nonplussed response. Well OK now.
It dawned on me at this point that a tepid dealer response to the Bolt is actually more surprising than a favorable one, even in conservative locales. We have to assume that all the Chevrolet dealers, whether in liberal or conservative territory, must know what GM knows, and what we know … that a certain number of electric vehicles (EVs) have to be sold in the so-called ZEV states — California and the 9 states that are copying California’s Zero Emission Vehicle legislation … which in turn is putting these states into compliance with the Federal Clean Air Act. The dealers also should know that selling the Bolt helps GM earn ZEV credits, which in turn allows the dealer network to sell more of the profitable ICE (Internal Combustion Engine) powered vehicles such as premium sport utility vehicles (as opposed to purchasing the needed ZEV credits from other BEV makers such as Tesla). So it seems that on the surface even those Chevy dealers in the “red” area have a motivation to sell the Bolt. What do you think is going on with the laggards spotted in the prior article? Have such dealers not done the math? Are they thinking the other dealers will do the heavy ZEV lifting? Are they convinced their customer base won’t budge on a Bolt? Or in 6 months from now will virtually all California and Oregon dealers be actively moving Bolts?
Over in beautiful Monterey we find people from all walks of economic life, from farm workers to mansion owners bordering the golf course. What has this particular dealer been up to? “Peninsula Chevrolet Cadillac” (which is technically in the adjacent town of Seaside, but it’s all part of the Monterey Peninsula) has sold or pre-sold over a dozen Bolts already and had 10 on the lot when I visited. I randomly hooked up with “Roberto,” who is a car guy from way back (that’s a Key Largo homage). Roberto got the car bug when he was just 5 years old. As a GM salesman with several certification credits on product knowledge, he had briefed himself quite well on the Bolt and was able to demonstrate the car with aplomb. We walked outside and headed to an LT model sporting a couple of option packages.
I’d like to describe my first impressions of the car, with the caveat that this is nothing like an actual review, which others are rendering more than adequately. Just some impressions, mind you. The first thing I noticed as we strode by the lineup was the range of colors. Interesting tones such as Arctic Blue Metallic and Cajun Red. The blue one was light in color with a silver hue. The color fit the shape of the car well. My first thought was that if I ever tire of my current favorite color — metallic gray, which I moved onto from black because of the upkeep — the Arctic Blue might do. The Cajun red was not a typical hot “F me” red. It was subdued and rather tolerable. It was kind of saying, “You can kiss me, but you can’t F me.”
Anyway, colors are subjective. As is the body style. For my sensibilities, though, given all the concern about the pregnant rollerskate hatchback motif — a concern I certainly shared — the car actually looks better in person than in the photographs. It looks smart, and the color palettes augment that notion. It’s not bug-eyed like the Nissan LEAF. Everything seems in proportion. Again, subjective. Your mileage may vary.
After the external onceover, Roberto popped the hood. Oh my, oh my, oh my. My daughter, who I recently bought a car for, glanced under the hood of the ’92 Corolla sedan she had been gifted and uttered “It all looks like just a bunch of metal to me.” Yeah. Pretty much my take — the lifelong backyard mechanic — gazing upon the guts of the Bolt. The compartment is chock full of strange-looking aluminum boxes, fittings, braided hoses, coolant reservoirs (3 of them!), and other weird-looking bits. I might as well have been looking inside the engine compartment of the Millennium Falcon.
Well, not quite. I had learned in reading about the Bolt that GM was using an AC motor, which of course is what Tesla uses. I wrote about that motor here. And sure enough, running from one aluminum box to another aluminum box, or as the Brits like to say, aloomineeum, were three fat power cables. That is the tell denoting that a 3-phase AC motor is on the job. One aluminum box is clearly the 3-phase inverter, drawing its power from the battery pack. The other end of the three fat cables obviously housed the motor, driving the front axles. So, the Bolt is using the same design as the Tesla, right?
No. The stator (the stationary portion of the motor) is creating its mandatory electromagnetic fields via 3-phase AC. Very efficient. That is very Tesla-like. However the Bolt motor is not an induction motor. An induction motor has a solid metal rotor (the inner rotating part of the motor that drives the wheels) configured to create a series of “shorted circuits,” which in-turn *induces* a current to flow when exposed to the magnetic fields in the stator … which in turn creates a magnetic field opposing the stator fields. As the two magnetic fields push and pull against each other, the rotor twists around and around, making the car go. (Yes, electric motors are remarkably simple things. Nikola Tesla’s genius was in figuring out that an electric current can generate a magnetic field, which in turn can induce a current to flow under the right conditions, which in turn can generate another magnetic field). But you don’t have to induce a current to make that opposing magnetic field on the rotor. You can simply affix some permanent magnets (usually rare-earth type) to the rotor and get a similar effect. Both methods work and are in common use, and each have their tradeoffs. Induction motors create more heat that must be dissipated, but with permanent magnet motors you have to pay through the nose for narrowly sourced rare-earth magnets. According to this under-the-hood walkthrough by a GM rep, the Bolt motor is using permanent magnets.
So, panning back to the wide view, we have a new entry in the electric car market that is almost the design antithesis of the benchmark electric car — the Tesla (pick your model). This is not a judgement against GM. It’s just that it’s remarkable to have two vehicles so similar in terms of power plant, the ability to go the distance, as well as the green factor … yet design-wise the two vehicles are polar opposites. It’s almost a paradox … certainly a dichotomy.
The Bolt and the Tesla are somewhat analogous to the male and female body in that either gender can be recognized as Homo sapiens relative to any other object on earth, but compared to each other the plumbing is radically different (thank God). Likewise, people will soon recognize a Tesla and a Bolt as two long-range EVs, unique from any other car … but contrast the front-wheel drive Bolt to the rear-wheel drive Model S, as well as the looks and motor.
The Bolt is pleasing to view. It really does look great in person. But then you look at the Tesla, slinking down the highway with its flush door handles and that oh so perfect shape, and you think, poetry in motion. Then you view the Tesla’s horizontally opposed motor housed in two adjacent, perfectly round “cans,” inverter on one side, motor on the other side, residing on the same plane as the battery … and it’s like elegance personified. Form and function brought together in a way that would fill Frank Lloyd Wright with envy. You open the hood and see only an empty cavity to stash your stuff in. The Tesla power plant is performance art.
Under the hood of the Bolt is a bunch of metal boxes and wiring harnesses. Not that there’s anything wrong with that! In its own right, all those goodies are super cool looking. It’s very sci-fi. Quite honestly, if Star Trek: The Next Generation had used something like a scaled-up version of the Bolt power plant for the ship’s power source instead of that silly looking “potbellied stove” apparatus, the engine room would have seemed a lot more real. The same can be said for the Enterprise’s engines on the rebooted Star Trek movie whose engine room was shot in a brewery. I mean, come on now. What’s supposed to be in those vats, plasma? (I can poke fun at these productions because I love them with all my heart and soul).
It is of course unfair to compare a $70,000 car to a $35,000 car. But a comparison to the upcoming Model 3 may not be all that different. I suppose that if you had to assign genders to these two cars you could say that the Bolt is sort of the male of the long-distance EV species, bulky and stalwart, whereas the Tesla is the sleek and elusive female. If you watch the video of a Model S owner reviewing the Bolt (quite fairly, I might add), then the analog might be that the Bolt user interface is more PC-like compared to the more Mac-like Tesla GUI (i.e., more user friendly).
Here are a few notes from the test drive.
- Examining the perimeter of the vehicle, I noticed that all 4 doors had a little button on them to lock/unlock if you have the electronic key in your pocket. My 2016 Prius only does that on the driver’s door. I looked lower and saw that Chevy had equipped the car with Michelins, and embossed on the tires was the text “Energy Saver.”
- Getting in the car for a test drive, I immediately noticed the comfortable texture of the seats. It felt good to sit in the car. The tall roofline gave my nearly 6’2” frame plenty of headroom (parenthetically, I had been in a Ford Focus earlier that day and my limited supply of hair was scraping the headliner).
- The Bolt does not feel like a cheap compact car. In spite of some cheap plastic components here and there, the car felt solid. The doors felt solid (although it takes a bit of a push to latch them shut). The optional leather-wrapped steering wheel felt solid. The drive of the car was … solid. It’s a fun car to drive.
- There is some nice “tech” inside. Useful. Comprehensible. There is a 10” center console touchscreen that’s visible but not dominating. There’s also a display dead ahead of the driver. Together, they provide a range of useful telemetry. Various adjustable display modes accommodate the casual I-just-came-from-an-ICE-car type driver, or you can geek out and see things like the actual kilowatts being drained from the battery as you womp on the pedal. My notes were insufficient to catch every item that Roberto pointed out, but the continuing impression was that GM had put a lot of thought into details and ergonomics … both on the technology and elsewhere.
- Speaking of flooring it, the car lives up to the reputation of instant torque electric cars. I don’t have a lot of experience to compare to, but when I needed (or wanted) to get up to speed quickly, like on a freeway on-ramp (which if you watch Jay Leno’s Garage seems to be the best place to get it on without getting ticketed), or to put some distance between your car and the rest of the pack, this car makes it real. I didn’t take any measurements with my stopwatch but the salesman claimed he had timed a 0–60 run and it had come in a bit under 7 seconds, as promised. The only disappointment was that when I tried to peg the speedometer on Hwy 101 it was stopped at 92 MPH by a governor. That’s gotta go.
- Roberto pointed to the electronic shifter and mentioned that it was grafted technology from Cadillac (I think it’s referred to as shift-by-wire). Impressive. What was unimpressive was that the shifter takes up real estate on the horizontal center console. I’ve driven a couple of cars that have the shifter mounted vertically below the radio (like my Prius). It’s nice to have the extra space below. Not a deal breaker though.
- The good part is that a flick of the wrist on the shifter moves the indicator from D to L, kicking in the regenerative braking. For those who may not know, regen braking effectively turns the drive motor into an alternator when the car is slowing (foot off the pedal), which in-turn charges the battery, which in-turn loads down the motor, which in-turn slows down the car … without actually having to apply the brakes. Essentially, it’s a clever way of turning kinetic energy into electrical energy, with the helpful side effect of saving on brake wear. It’s a win-win-win scenario.
I located the much touted regen paddle on the steering wheel, and when tugged on, the regen is kicked up by several notches beyond what shifting to L alone provides. Unlike my Prius, which has wimpy regen, the full-on regen of the Bolt (L + paddle) can bring the car to a dead halt (which I understand you can do on a Tesla as well). It’s that one-pedal driving we hear about and it’s really cool. If you haven’t driven a car capable of this level of regen braking, but you happened to drive those little electric bumper cars at the amusement park when you were a kid, you already know the drill. Take your foot off the pedal and the car stops. Roberto suggested keeping the car in D on the freeway and in L on the streets. Makes sense.
- Roberto pointed to the windshield wipers. The car has these beefy full-length wiper blades that sweep the entire windscreen when they go. Indeed the wipers were as manly as the regen. This was another example where GM appears to have not cut corners just to produce a minimally sufficient compliance car. I mean, how many people are going to check the size of the wiper blades when shopping the car? Yet down the road it makes a difference.
- Another impressive inside detail was a sliding arm rest on the console. It slides forward and back a bit to accommodate various driving positions. Flipping the arm rest up revealed the usual cavity, replete with twin USB charging ports. Roberto said that the Premiere edition also had a wireless phone-charging caddy in that hole.
- Finally, a comment about ambient noise while on the highway: Put simply, you hear it. You hear the cars go by. It does not seem any louder, though, on the Bolt than a typical ICE sedan. Roberto agreed, and had the added experience of having driven dozens of different car models at Peninsula Chevrolet Cadillac and elsewhere. His view was that one of the biggest differences between luxury cars and cars designed for the plebeians was how well the car isolates you from the rest of the world. You have to pay extra for that dampening. Now, there’s an option package I would love to see for the Bolt.
If you discount the current frenetic rate of Bolt sales as pent-up demand, then one wonders what will ramp up Bolt sales among the unwashed masses who have not yet tuned into the electric car revolution. I can think of two things. …
While conversing with the Chevy salesman, it was inevitable that the “C” word came up … charging. That’s a pretty big deal, and GM hasn’t exactly bowled us over with its aggressive plans to be a catalyst in building out the DC fast charging network. Roberto of course acknowledged that a DC fast charge network is important. Interestingly, the Monterey/Seaside region has three such chargers online already. The dealer is gearing up to add their own DC fast charger as well. Which, to be fair, is four times the number of Tesla supercharging stations in the area. Of broader appeal is the assertion Roberto made that he had delivered a Bolt to San Diego and was able to fast charge the car to that destination.
The other shoe still to drop will be the availability of the car in non-ZEV states once the 10 ZEV states are fed. For now, would it not be reasonable to applaud GM for getting the Bolt out … even if it is for altruistic motives? For myself, I have been firmly in the criticize-GM-for-outsourcing-the-entire-drivetrain camp … waiting for someone to dub the GM Bolt the LGM Bolt. At the same time, however, the behemoth automaker delivered the Bolt on time, it is ostensibly a decent automobile, and how could GM be criticized for complying with regulations and rolling the Bolt into the ZEV states first?
But it seems that the willingness with which GM will make the Bolt available to everyone everywhere will be based at least in part on Bolt profitability. Hard to get too excited about selling a car that loses money if it’s not farming ZEV credits. There have been several opinion pieces insinuating that GM is going in the hole on every Bolt sale. Aside from any offsetting ZEV credits, is this assertion correct? Does anyone outside GM really know if the company is making or losing money on a per-car basis? That seems to be the giant unanswered question. Zachary Shannan posted a video he shot of Julian Coxmaking a case that the Bolt could not be anything but profitable. He argues that the Bolt is fashioned after the Chevy Sonic, and that when you take the cost of the Sonic’s shell and fit it with an LG powertrain, LG battery pack, and ancillary items, there’s no way the Bolt could not make money at $37,500. But Mr. Cox doesn’t really know. Bob Lutz seems to be doubtful the Bolt will be profitable, but he’s theoretically out of the loop now. The largest variable is what GM is paying for the LG parts, including the several ancillary systems like the air conditioner and infotainment system. Does it all add to over the $37,500 base price? Who knows, but don’t forget the Ferengi 286th rule of acquisition, which states: “Things always cost more than you expect.”
So, how was the test drive? Awesome. I have a Model 3 on order, and am only 6 months into a 2016 Prius lease (which was not planned, but when your 23 year-old Corolla wagon dies unexpectedly while on vacation, and Toyota drives out and picks you up and gives you an offer you can’t refuse on an end-of-year clearance lease, it’s hard to say no). Still, it’s hard not to drop the dime on a Bolt because I really can’t find anything to dislike on this car. The battery warranty is not ironclad, but then again, neither is the Tesla’s. But that’s about it. Quite honestly, if a killer lease deal were to come along, this lad may well take the bait. The electric car revolution has just shifted gears and I want to be a part of it. Now.
Tags:Chevy Bolt, EV reviews, GM, motors
About the Author
Steve Bakker is a semi-retired teacher, writer, and technologist who is currently passing time by attempting to cure his ignorance as to how electric cars work.