It's Been Stalling, but GM Needs to Go Wide with its New Hybrid Strategy

General Motors, usually not this light on its feet, has a smart idea: It's responding quickly to high fuel prices with a plan to turn many of its popular crossover SUVs into quasi-hybrids. GM should make this move sooner rather than later, because a public shell-shocked by pump prices is clamoring for fuel-efficient cars.

GM's strategy, still tentative, would add its start-stop "eAssist" technology to the Chevrolet Equinox, GMC Terrain and possibly others. The start-stop system -- more on that in a moment -- can boost fuel economy by roughly 25 percent. That will be welcome, because people are actually reading GM's fuel economy stickers, and they don't like what they see.
How bad has it gotten? The V-6 once ruled supreme in crossovers, but now 70 percent of Equinox and Terrain customers are ordering their vehicles with four-cylinder engines. That's also true of 46 percent of all Chevrolets, up from 23 percent in 2007. Consumers are finding it easy to make the switch because there's not much tradeoff in terms of horsepower -- four bangers incorporating direct injection and turbocharging are making much better fuel economy numbers without sacrificing performance.

GM: Starting from nowhere in the hybrid race
If you can't think of any popular GM hybrids, that's because there aren't any. What GM has done so far is put a pretty good two-mode hybrid system in very big thirsty vehicles, resulting in marginal fuel economy gains but significant price hikes. Customers are few and far between. The company still needs a credible full hybrid that's at least in the same ballpark as the Toyota Prius, but eAssist is a good stopgap measure.

Start-stop is a relatively cheap way to improve fuel economy in a big way, costing from $500 to $1,500 per car depending on the sophistication of the system. Cars with start-stop systems, sometimes called "microhybrids," shut down the engine at stop signs, then restart it in a fraction of a second when the driver's foot leaves the brake. Anyone who's ever wasted gas idling in a traffic jam can understand the benefits.

Good bang for the buck
So why haven't American automakers gotten on board earlier? Start-stop has already been widely adopted in Europe and Japan, and it has or will soon appear as standard equipment on millions of cars from BMW, Mercedes, Mini, Mazda, Peugeot and Citroen. A Strategy Analytics report predicts that 20 million cars worldwide will have start-stop by 2015. Lux Research sees U.S. volume as 4.6 million by that point.

Going slow in Detroit
The excuse I've generally gotten from go-slow American companies is that the tests that determine EPA mileage don't include many starts and stops, and therefore don't give systems like eAssist a chance to show what they can do. In Europe, where automakers are trying to reach tough tailpipe-emissions goals, the gains are immediate and rewarding.

The EPA is supposedly working on reforming the test process, but in the meantime American automakers have finally decided they can't wait any longer with start-stop -- the window sticker be damned, their customers are demanding better fuel economy now.

According to Roland Hwang, the auto analyst at the Natural Resources Defense Council:

Yes, in the past, the EPA tests have undervalued stop start. I also think GM is struggling to find a hybrid strategy, and this might give them a good marketing boost.

A timid rollout... so far
GM started cautiously with eAssist, adding it to the Buick LaCrosse late last year, to the Regal this year, and also to the Chevrolet Malibu Eco introduced last week at the New York Auto Show. But now it's at least thinking of going wide.

GM's eAssist is more sophisticated than many start-stop systems, combining an alternator-starter motor, regenerative braking and a lithium-ion battery pack. The starter motor can act like a generator to recharge the battery pack, which contains enough energy to actually drive the car for short distances (and restart it repeatedly after the engine shuts down at stops) .

The midsized Equinox and Terrain are excellent candidates for the system, because they're hot-selling crossovers with poor around-town fuel economy (16 to 20 mpg). And city mpg is the very area that eAssist targets.

Home on the range
Another benefit of eAssist is adding range. The Malibu Eco can travel 550 miles on a tank of gas, and that produces the very opposite of the "range anxiety" electric-car buyers are experiencing.

This being GM, the bottom line is still holding sway. GM's North American President, Mark Reuss, told Automotive News last week that the company is going "to lead with fuel technology that we know people will pay for in an environment of rising fuel prices."

In an interesting move, Buick offers eAssist on the LaCrosse at the same $1,370 price as the V-6 option. So customers have a stark choice: fuel economy or power. The V-6 is a gas guzzler, especially in the city. With eAssist, the four-cylinder LaCrosse goes from 19 mpg in the city to 25, and from 30 mpg highway to 37. The eAssist Malibu Eco does slightly better than that, with 38 mpg on the highway (and 26 in town).

Once a star, the V-6 is headed for also-ran status, and not just at GM. Moving forward, every automaker is going to want to get more performance out of the four-cylinder engine.

Related:

• U.S. Could Sell 4.6 Million Start-Stop Micro Hybrids by 2015, Lux Says