Chevy Volt gets caught in Washington crossfire

Reuters News
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Posted: Jan 25, 2012 12:48 PM
Chevy Volt gets caught in Washington crossfire

By John Crawley

WASHINGTON (Reuters) - The Chevy Volt became a political punching bag on Wednesday, with Republicans accusing the Obama administration of hiding fire risks from the public, and General Motors saying its signature electric vehicle unfairly got caught in political crosswinds.

Jim Jordan, chairman of the House Oversight regulatory subcommittee, said it was disturbing that U.S. safety regulators waited six months to open a formal investigation after their own crash tests uncovered fire risks.

He speculated that the administration may have been preserving its own interests. President Barack Obama has heavily promoted electric vehicles like the Volt, and his administration oversaw a U.S. government bailout and bankruptcy restructuring of GM in 2009.

GM Chief Executive Dan Akerson had his own theories about how politics influenced the probe. He told the hearing that the Volt got "disproportionate scrutiny" because it became a surrogate for election-year politics and commentary on GM's business and Obama administration policy.

"We did not engineer the Volt to be a political punching bag. And that, sadly, is what the Volt has become," Akerson said.

The National Highway Traffic Safety Administration opened an investigation on November 25 into the safety of the Volt's battery pack after its own repeated tests uncovered fire risks.

The fires occurred after NHTSA crash tests or other tests where the car's lithium-ion batteries were purposely damaged, and GM has stressed that no "real world" incidents have been reported.

NHTSA closed its two-month investigation last week without finding any defects and expressing satisfaction with GM's remedies to better protect the lithium-ion battery pack.

David Strickland, the agency's administrator, said investigators first needed to analyze why the fires occurred. He said the agency had no real-world data on Volt fires and used "every second" over a six-month period for engineers to perform a thorough investigation.

Strickland said there was no unreasonable risk to public safety and said he would have sounded a public alarm had there been a reason to do so.

"We pulled no punches," he said under withering questioning from Jordan and other Republicans on the committee. "The Chevrolet Volt is safe to drive."

Akerson, who owns a used Volt, said he knew of no pressure from the Obama administration to squelch any public discussion of the fires. He said the administration has no seat on the board and no influence over business decisions. Taxpayers owned a majority stake in GM after its $50 billion bailout and bankruptcy in 2009, a stake that was reduced to a third through the company's public share offering in 2010.

The Volt is the centerpiece of GM's efforts to lead on fuel efficiency. Its development has been supported by Obama, who envisions electric cars as a game changer in reducing oil imports and tailpipe emissions.

The administration has aggressively backed more than $2 billion in funding of suppliers and other research that spurred development and production of the $40,000 Volt and battery systems designed for other electric vehicles. Volt owners are eligible for a $7,500 tax credit for buying a the vehicle, a benefit Obama has sought to sweeten without success.

There are roughly 8,000 Volts on the road today and another 6,500 have been manufactured. All will undergo retrofits to better protect the battery from damage in crashes. GM will also take steps to reduce chances of coolant leaks, which can trigger fires.

Democrats, including Elijah Cummings and Dennis Kucinich, were aggressive in challenging Jordan and Darrell Issa, the chairman of the full Oversight panel. The Democrats said it was the prerogative of Congress to look at the issue, but that the investigation had gone off track.

"I'm concerned that the intended effect of this hearing is to undermine technology that is critical to both protecting the environment and ensuring the success of the U.S. auto manufacturing industry," Kucinich said.

The Oversight Committee has spearheaded the congressional investigation of Energy Department loan programs, including financing of bankrupt solar panel company Solyndra.

(Reporting By John Crawley; Editing by Maureen Bavdek and Tim Dobbyn)