|21st July 2008, 21:17||#1|
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Intel's Grove Wants to Convert Existing Cars to Electric!
Grove Invokes Paranoia to Prove Only Electric Vehicles Survive
By Adam Satariano and Alan Ohnsman
July 21 (Bloomberg) -- Andy Grove, the former head of Intel Corp., asked students in his Stanford University business school seminar last year to determine whether an electric car market could thrive in the U.S. Their conclusion: It can't.
That propelled the 1997 Time Man of the Year, now retired, on a personal crusade to reshape U.S. energy policy, take on the auto industry and attack America's leaders for risking the nation's security.
Grove, 71, who revolutionized production of devices at the heart of computers, is exploiting his name and ties to investors and politicians to jump-start a similar advance in battery-run vehicles. His idea is to refit millions of gas-guzzling autos to run on electricity part-time and convince carmakers to adopt so- called open source rules on advanced technology so that Americans can convert their cars.
``I came to a few conclusions that I was stunned by because they were so obvious and people don't seem to get it,'' Grove said in a July 8 interview in his office in Los Altos, California. U.S. dependence on oil may bring economic calamity and eventual conflict with China, he said.
Grove, who joined Santa Clara, California-based Intel in 1968 and built it into the world's biggest chipmaker with $38.3 billion in revenue last year, says electrifying cars is the fastest way to ease international competition for energy because passenger autos account for almost half the U.S. use of oil.
`There Could Be Blood'
His path to advocacy includes a disagreement with former Vice President Al Gore and an unreturned message to General Electric Co. Chief Executive Officer Jeffrey Immelt.
While Grove's students said a failure of political leadership is what is keeping electric cars from the market, automakers and analysts say challenges include high costs, a lack of batteries sturdy enough for daily use, no recharging infrastructure, and harmful environmental effects if coal-fired plants are the main energy source.
``All these objections are absolutely valid in a peace state,'' said Grove, who entitled his 1996 book on management, ``Only the Paranoid Survive.'' ``What if we are approaching a state of war, whether it is literally shooting or just starving to death economically?''
In Silicon Valley, Grove is prodding venture capitalists to fund electric vehicle technologies with a lecture he's delivered to Kleiner Perkins Caufield & Byers and Khosla Ventures titled ``There Could Be Blood.'' He's aiming to tap the entrepreneurial drive that led the region to dominate software and Internet businesses.
In his keynote speech tomorrow at the 2008 Plug-In convention in San Jose, he plans to outline his concerns. The closing slide in a draft of his presentation, Grove says: ``Motivation. Not Cost. Not Environment. SURVIVAL!''
In four years, Grove wants 10 million vehicles to be equipped with battery packs capable of powering at least 40 miles of all-electric driving before the gasoline engine engages. They'd be recharged with power from domestic sources instead of oil, 58 percent of which is imported.
In his speech, he'll call on the U.S. to offer tax credits or interest-free loans to retrofit vehicles and urge utilities to provide fee-free power to charge them for two years. Carmakers should adopt open-source policies to share technology and commit to honoring warranties when consumers do such modifications.
Grove says he is unimpressed with the energy policies of the leading presidential candidates, Republican Senator John McCain and Democratic Senator Barack Obama, calling them ``investment plans with no strategy.''
Gore on July 17 called for the U.S. to shift entirely to renewable sources of electricity by 2018 as a way of quickly cutting carbon emissions contributing to global warming.
``He's addressing the second most important problem,'' Grove said.
Grove says he is encouraged by conversions of pickups and other autos that have been done by individuals and small shops for years. Batteries and motors are installed to add all- electric range and reduce vehicle's gasoline use.
``I would love to give a lot of light and limelight to these people who have been doing this in their garages because there are a lot of them,'' Grove said. ``This is how the computer industry became a very large industry.''
General Motors Corp. and Toyota Motor Corp., the world's biggest automakers, sold electric cars in California a decade ago and both plan to offer plug-ins by 2010. Converting vehicles not designed to hold hundreds of pounds of additional batteries doesn't work, they say.
Silicon Valley Club
``Batteries needed to move a large SUV would be very big and very expensive,'' GM spokesman Dave Barthmuss said. ``If things were that easy, we'd flip a switch and do it.''
Lead-acid and nickel-metal hydride batteries that have been used in vehicles converted by individuals are too heavy, and lighter, higher-powered lithium-ion packs aren't ready yet, said Toyota spokesman John Hanson.
``Battery technology is not anywhere near the level it needs to be for us to create a vehicle that delivers performance and range for a price people are willing to pay,'' Hanson said.
Other technology leaders interested in electrifying transportation include Larry Page and Sergey Brin, founders of Google Inc.; Sun Microsystems Inc. founder Vinod Khosla; and PayPal Inc. founder and Tesla Motors Chairman Elon Musk.
While they are investing in the technology, Grove, who has battled Parkinson's disease and cancer, isn't bankrolling electric car or battery ventures.
``I'm not interested in making money,'' Grove said. ``I am kind of done. I enjoy doing this because it's worthwhile. It started as a teaching exercise. As things get worse, I feel compelled to speak out on the subject.''
Neil Young's '59 Lincoln
Rock musician Neil Young is using his fame to fuel a similar campaign. He has gotten a Kansas mechanic to retrofit a 1959 Lincoln Continental convertible to run on batteries as a way to spur electric car conversions.
For his part, Grove has reached out to conversion experts such as Andrew Frank, a professor of engineering at the University of California, Davis to learn about their research and what they need to grow.
Frank is trying to raise at least $10 million to fund a company to convert pickups to run on electricity for the first 40 miles before switching to gasoline. His start-up, Efficient Drivetrains Inc., would train mechanics to perform conversions costing customers about $10,000, he said.
``I grew up in the days of hot-rodding, and fundamentally what we did was take conventional cars and added widgets to it to improve its performance,'' Frank said. ``That's what we are doing here.''
Grove is also working with Palo Alto, California-based CalCars, which promotes adding batteries to gas-electric hybrids such as Toyota's Prius to extend their electric-only range. Installing a second pack of batteries, reprogramming the software and installing a recharging plug can more than double the cars' fuel economy to 100 miles per gallon, CalCars says.
GM's Volt plug-in car, due in two years, is the right idea, though it's coming too late, Grove said. Along with a delayed reaction by automakers, he says he is disappointed that large U.S. companies such as GE haven't pushed for a rapid shift away from imported energy.
At a June conference hosted by venture capital firm Kleiner Perkins, Grove's emphasis on energy security as more urgent than global warming triggered an exchange with Kleiner partner Gore.
``I had a little disagreement with Mr. Carbon,'' Grove says. ``He didn't have a problem with my arguments. He didn't like the priorities. For carbon to kill us we have to stay alive for a while. It's not looking that good.''
Kalee Kreider, Gore's spokeswoman, said the former vice president and Grove share many of the same views. ``If the U.S. were to meet the challenge laid out by Vice President Gore, vehicles could then run off of a clean, renewable electricity grid,'' she said in an e-mail on July 18.
To contact the reporters on this story: Adam Satariano in San Francisco at firstname.lastname@example.org; Alan Ohnsman in Los Angeles at email@example.com
Last Updated: July 21, 2008 03:01 EDT