Big stakes in Two-Mode hybrid projectBMW, D/C and GM collaborate on transmission for SUVs

Richard Truett Automotive News / DETROIT -- Six miles north of Detroit in a quiet industrial park near a sprawling shopping mall, General Motors, DaimlerChrysler and BMW engineers are going to school to learn about Toyota's fleet of gasoline-electric hybrids.US and German flags snap in the breeze over the automakers' Hybrid Development Center, a brown brick building the length of a city block divided into four sections. Each automaker has a section. There's also a "cooperation area" where German and US engineers work side-by-side on a new Two-Mode hybrid transmission for pickup trucks, SUVs and luxury cars.Rivalries don't matter here. It is a leave-your-egos-at-the-door team effort, say Larry Nitz, of GM, Andreas Truckenbrodt, of D/C, and Wolfgang Epple, of BMW, the executives in charge of the historic project.The project could have strategic implications because:

• The Two-Mode will boost fuel economy of big SUVs and large luxury cars by at least 25 percent
• Having a fuel efficient full-sized SUV could give GM and Dodge a major competitive advantage over Ford Motor and import brands
• It could help GM sell more of its most profitable vehicles
• It would boost the engineering reputations of all three companies

Hybrids offer Europeans an alternative if diesel technology doesn't take off in the US as expected.Protecting profitsA successful project could protect GM's most profitable vehicles in North America -- big SUVs.Some analysts estimate that GM makes between $10,000 and $15,000 (about E7,900 to E11,800) profit on a fully loaded SUV such as the Cadillac Escalade.

In 2005, US sales of large SUVs of all brands totaled 831,017. GM owned 60.7 percent of that market with sales of 504,343 vehicles.But sustained $3-a-gallon (62 euro cents a liter) fuel prices are changing US consumer buying habits.In May, US sales of SUVs, vans and other light trucks plunged 15 percent at the Chrysler group, 14 percent at GM and 7 percent at Ford.

Through May, sales of all light trucks were down 6.2 percent.In a 2,400-person survey by US magazine Consumer Reports last month, 37 percent are considering trading in their SUVs and big cars for a more fuel-efficient vehicle because of high gasoline prices. Half are considering a hybrid vehicle.

The Two-Mode transmission starts production in about 15 months. GM will introduce it on the Chevrolet Tahoe, GMC Yukon and Cadillac Escalade SUVs. Dodge plans to launch a Durango SUV with the Two-Mode for the 2008 model year.

Mercedes-Benz and BMW have not said which vehicles will get the transmission or when it will debut. But it could end up in their big luxury cars to compete with the Lexus GS 450h sedan. And one or both German automakers could use the Two-Mode with a diesel engine and try to leap ahead of Toyota with a super fuel-efficient luxury vehicle.

If the transmission works as promised, the 25 percent gain in fuel economy would let GM SUVs, such as the 2,720kg Chevrolet Tahoe, get about 26 miles per gallon (9 liters per 100km) in combined city/highway driving. That would likely be enough to keep GM ahead of any US-government-imposed increases in corporate average fuel economy.What's the difference?In a hybrid such as the Toyota Prius or Ford Escape Hybrid, the driver doesn't feel the electric motor cut in and out during acceleration, only an ultra-smooth, quiet rush of blended power going to the wheels.

The real engineering magic of a full hybrid powertrain that can propel a vehicle using gasoline or electricity or both is in the control system and its software, said Tom Watson, Ford manager of hybrid powertrains. In a hybrid, a powerful computer manages the blending of power from the electric motors and gasoline engine. It also controls the hybrid's regenerative braking system that captures the vehicle's kinetic energy and turns it into electricity. But the Prius, Escape Hybrid and several Honda hybrids have drawbacks. They can't tow heavy loads. And sustained uphill driving will eventually discharge the batteries enough to turn off the electric motor assist, which reduces performance and boosts fuel consumption. Those are problems the Two-Mode system has been designed to solve. The parking lot outside the Hybrid Development Center looks like a science experiment. It's filled with eviscerated hybrids of all kinds. GM, BMW and D/C engineers are benchmarking the performance of numerous competitors' hybrid vehicles.

They dissected the mechanical and electrical systems to understand why they work so well. Japanese-market right-hand-drive versions of the big Toyota Crown mild hybrid sedan and Estima all-wheel-drive minivan are parked near a partially dismembered Prius. A heavy black electrical cable dangles below the Crown.

In addition to the hybrid Toyotas, there's a Chevrolet S-10 electric pickup from the mid-1990s, one of GM's diesel-electric city buses, and a Citroen C3 with a diesel engine and a stop-start system. There also is a Ford Escape Hybrid minus its powertrain.

The Two-Mode transmission is not a copy of a Toyota transmission, nor does it use Toyota technology. The basic design and layout of the Two-Mode is derived from GM's diesel-electric hybrid city buses developed in the mid-1990s.

GM's Nitz said the Two-Mode is alone among hybrid transmissions. It can tow heavy loads such as boats and horse trailers. And the way it shifts gears is different. When the transmission changes gears, the engine speed stays the same.

How the power is sent to the wheels, through a series of clutches and planetary gears, is another way the Two-Mode is better than existing hybrid transmissions, Nitz said. In a conventional hybrid transmission, power is sent to the wheels through one or two paths: electrically through the motors or mechanically through the internal combustion engine. The electric path is less efficient, said Nitz.

"We get 100 percent of the engine power to the [wheels] through a mechanical path," he said. "We can boost power output electrically, or we can do regenerative braking off the electric motors, but they are not in the power path." That's a big gain, Nitz said."

It enables full-displacement engines with reasonably sized motors. It enables great towing and higher performance," he said.A key aspect of the Two-Mode system is the powertrain's controller and the software in it -- the brains of the system. It keeps the engine running in what engineers call a "sweet spot" in the rpm range.

If more power is needed, say to propel the vehicle up a steep grade, the controller will keep engine speed steady but use the electric motors in the transmission for the extra power, said Steve Poulos, GM's hybrid powertrain chief engineer. "The whole goal is to always get your engine parked near that point," he said.

The Two-Mode transmission alone doesn't provide the entire fuel economy gain, Poulos said. Some comes from a cylinder cutoff system that turns off half the V-8 engine at highway speeds, a stop-start system that turns off the engine at stoplights, and improved aerodynamics.

Competitive advantage?When the Two-Mode debuts in the autumn, GM's main rival in the full-sized SUV segment, Ford, will not have a similar transmission or a full-sized hybrid SUV. Neither will any import brand. But less competition doesn't guarantee sales success, said Phil Gott, an analyst at Global Insight's US office in Lexington, Massa-chusetts. Gott believes that, much like with the Prius and Honda hybrids, most drivers will get much less than the US Environmental Protection Agency-rated fuel economy in SUVs with the Two-Mode transmission.

"Very few automotive sales are made because of a transmission," Gott said. "The real question is: What is the impact of hybridization on the marketability of an SUV?"So far, hybrid SUV sales have been poor. Toyota is having a tough time selling Highlander Hybrids and Ford has needed big incentives and a major marketing campaign to ignite sales of the Escape Hybrid. This project gives GM the chance to re-establish its reputation for engineering excellence, which it lost in the 1970s and 1980s because of disasters with diesel engines and other failed technologies.

Said Gott: "Offering hybrids will help assure in peoples' minds that GM is a current technology company. It will help bring people into the showroom. It will help give people confidence in the company, and it will help GM sell vehicles overall, even though most of them won't be hybrids."BMW and D/C won't talk about their plans for the Two-Mode.

Epple, the BMW hybrid chief, said his company joined the partnership because BMW was impressed with the Two-Mode's potential and because it could get a version of the transmission faster and cheaper than if it had developed or bought a similar transmission from a supplier. Truckenbrodt, D/C hybrid chief, agrees: "We are really building on a very good solution already. But it improves so much by adding the experience and the lessons learned and the competency from those various engineers."

The Two-Mode transmission also could be a way for German automakers to hedge their bets. If their plans for diesels in North America don't succeed, they will have the Two-Mode transmission to give them high fuel economy.

"Hybrids are one alternative to improve fuel economy," Epple said. "Nobody knows what is going to happen to diesel in the US. The memory of the customer lasts a long time." People don't forget," he said, noting the lingering bad reputation of diesels from the 1970s and 1980s.

None of the automakers would discuss the financial aspects of the Two-Mode. But it is unlikely to be sold for a profit, at least initially. Nitz said GM hybrids will debut with nickel-metal hydride batteries. Not until lithium-ion batteries are available late this decade can automakers take significant costs out of hybrids, said Ford's Watson.Said Epple: "The thinking and pride of engineers is once you produce something and have something on the drawing board -- ideas then arise as to how it can be improved, modified and the costs can be reduced."

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