Business

GM shows its hopes for future

DETROIT — General Motors Corp., a wounded company living on cash borrowed from the government, didn't behave like one Monday as it unveiled ambitious plans to research and assemble lithium-ion batteries in Michigan and picked a Korean company to supply the cells to power the Chevrolet Volt electric car.

But a top executive raised the prospect that GM will need more federal loans later in the year if the U.S. auto market doesn't improve, saying that the company presented a worst-case scenario to the government last year that would require $18 billion in loans, $4.6 billion more than the Bush administration has granted.

The battery factory, to be opened somewhere near Detroit, will employ more than 100 people and be highly automated as it takes cutting-edge lithium-ion cells imported from LG Chem Ltd. of South Korea and welds them into battery packs for the Volt and other next-generation vehicles from GM.

GM also announced the creation of a 31,000-square-foot battery lab, the largest in the country run by an automaker, at its Warren technical center.

Tony Posawatz, GM's vehicle line director on the Volt, said he expects the battery factory and lab will bring in companies that supply parts for futuristic electric cars, creating another employment base for the troubled Detroit area.

The battery announcement was among the biggest news from the Detroit show Monday, where Toyota Motor Corp. ramped up the competition in hybrid gas-electric vehicles by showing off the next generation Prius, the top-selling hybrid in the United States.

The 2010 Prius gets an average of 50 miles to the gallon, four more than the current model, which already is the most fuel-efficient vehicle ranked by the Environmental Protection Agency.

The third generation of the hybrid has a more aerodynamic design, but its exterior is easily recognizable as a Prius. Toyota said pricing will be released before the midsize sedan goes on sale in late spring.

Honda Motor Co. on Sunday unveiled a new version of the Insight to compete directly with the Prius, and Ford Motor Co.'s hybrid Fusion also is due this spring.

Also Monday, California start-up Fisker Automotive showed a production version of its $80,000 plug-in Fisker Karma and vowed to sell 15,000 of the sporty luxury hybrids annually.

Volkswagen AG said it plans to offer hybrid and diesel versions of four upcoming vehicles being developed for the U.S. market, including a future successor to the Jetta sedan.

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