Chrysler Disbands ENVI Electric Vehicle Group; Function Absorbed into Traditional Line Organization
08 November 2009
Reuters reports that Chrysler has disbanded its ENVI team, formed in 2007 to bring electric-drive vehicles and related advanced-propulsion technologies to market. (Earlier post.) At the North American International Auto Show in January 2009, Chrysler had introduced two new EV concepts and updates on three earlier EV concepts developed by the ENVI group. (Earlier post.)
In April 2009, Chrysler unveiled four all-electric Chrysler Town & Country minivan concepts to the US Postal Service (USPS) in Washington, DC. Then, Chrysler announced that it intended to apply to the US Department of Energy’s (DOE) Transportation Electrification stimulus program for a federal grant, which would enable Chrysler to establish a nationwide demonstration fleet of zero-emission electric minivans that could be used by the US Postal Service for mail delivery. (Earlier post.)
And in May 2009, Chrysler LLC submitted three proposals representing a request for $224 million in funding to two US Department of Energy (DOE) initiatives: the Electric Drive Vehicle Battery and Component Manufacturing Initiative and the Transportation Electrification Initiative. With a 50/50 cost share, the total investment represented by the proposals is $448 million. Proposed vehicles covered under the submission include Dodge Ram 1500 Plug-in Hybrid-electric Vehicles (PHEVs), Chrysler Town & Country PHEVs and Chrysler Town & Country Electric Vehicles (EVs). (Earlier post.)
In August, Chrysler took $70 million in grants from the US Department of Energy to develop a test fleet of 220 hybrid pickup trucks and minivans.
During the unveiling of the new five year (2010-2014) business plan last week, however, there was only one hybrid (the two-mode RAM) with plans for a PHEV demo fleet and a battery electric vehicle to follow sometime in mid plan.(Earlier post.)
Chrysler spokesman Nick Cappa said on Friday that an in-house team of electric car development engineers had been disbanded in favor of a more traditional organization. “ENVI is absorbed into the normal vehicle development program,” Cappa told Reuters.
Under the Marchionne plan, former ENVI chief Lou Rhodes will become the group line executive in charge of electric car development for both Fiat and Chrysler, Cappa said.
Marchionne told reporters and analysts electric cars would only represent “one to two percent” of Chrysler’s sales by 2014, equivalent to less than 60,000 vehicles—a percentage consistent with the current proportion of hybrid to conventional vehicle sales for all OEMs in the US with the exception of Toyota. (Earlier post.)
As outlined in the plan, Chrysler is putting a more immediate focus on downsizing its engines and improving fuel economy across the entire portfolio.
Seems to me this is more about organizational behavior than anything else. Chrysler-Fiat wants a more centralized management structure that will benefit the organization as a whole...the ENVI unit within Chrysler would be a group of hot-shot engineers that probably wouldn't share information as much as needed in the new framework.
Posted by: ejj | 08 November 2009 at 06:34 AM
It seems evident that Chrysler has given up and will no try to catch up with Toyota with HEVs, PHEVs and BEVs. Toyota's latest sales of electrified cars already represents 12.5% of their total sales.
Chrysler's decision seems to be opposite to Nissan-Renault decision (and many others) to go full speed ahead with electric vehicles very early in the next decade.
Since electrified vehicles represent the future, doesn't that lead Chrysler into the downward road that will force this producer to close shop within 10 years or less?
These are the years to choose to adapt or die.
Posted by: HarveyD | 08 November 2009 at 08:52 AM
HarveyD: Electrified vehicles do represent the future but they can't be made cheaply in massive numbers yet. FiatChrysler will be minting mass numbers of small efficient ICE cars and try to make a profit doing it. They're going to roll the dice and....fail - that's my prediction.
Posted by: ejj | 08 November 2009 at 08:00 PM
ejj:
Its amazing to note the very different approaches from various car manufacturers.
Nissan-Renault have done an about face and are now going ahead with BEVs. Toyota is holding back on BEVs and PHEVs in favour of HEVs. Honda favours FCs. Chrysler is giving up to cut cost. GM is putting its fate (mostly) into the Volt. Ford is slowly but surely looking at opportunities. BYD China is going PHEV + BEV. Tata is planning BEVs. Most others are thinking of what to do next.
The next decade is not going to be easy for vehicles electrification on a massive scale. The transition will cost $$$B and may bankrupt a few.
In the long run, ounce improved batteries (or e-storage units) become common place and are mass produced in many countries in all continents, price will come down. Low and affordable cost BEVs production will take off (by 2020/2025?). The next one billion new vehicles may very well be mostly electric, at least after 2020.
Posted by: HarveyD | 09 November 2009 at 03:55 PM
Hello all,
So it seems that A 123 will be in trouble in EV business since Chrysler gave up on this field and Fiat does not seem to focus so much on electric vehicles.
Do you think that A 123 will find other clients ?
That Fiat will stay on LFP as A 123 ?
Thanks for your inputs,
David
Posted by: David M. | 10 November 2009 at 02:12 AM