On September 29, 1993, President Clinton initiated the Partnership for a New Generation of Vehicles (PNGV) program, a cooperative research and development (R&D) program between the federal government and the United States Council for Automotive Research (USCAR), whose members are DaimlerChrysler Corporation, Ford Motor Company, and General Motors Corporation (GM). 1 This PNGV agreement created a unique industry and government partnership with the broad objective of “strengthening U.S. competitiveness by developing technologies for a new generation of vehicles” (PNGV, 1995). These vehicles were to be conceived using new technologies to produce much lower national gasoline consumption and carbon dioxide emissions. The PNGV Program Plan recognized that, to have substantial impact, these vehicles must be sold in high volume (PNGV, 1995). This, in turn, requires that they meet all emission and safety requirements and include all of the characteristics that result in strong customer appeal. In addition to product redesign the program embraced research aimed at improving the effectiveness of the broad manufacturing enterprise, including everything from the development of new analytical tools to the use of new materials and manufacturing processes.
The PNGV declaration of intent requires an independent peer review “to comment on the technologies selected for research and progress made.” In response to a request in July 1994 by the undersecretary for technology adminis-
1USCAR, which predated the formation of PNGV, was established to support intercompany, precompetitive cooperation to reduce the cost of redundant R&D in the face of international competition. Chrysler Corporation merged with Daimler Benz in 1998 to form DaimlerChrysler. USCAR is currently composed of a number of consortia, as shown in Appendix D.
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Page 13 1 Introduction On September 29, 1993, President Clinton initiated the Partnership for a New Generation of Vehicles (PNGV) program, a cooperative research and development (R&D) program between the federal government and the United States Council for Automotive Research (USCAR), whose members are DaimlerChrysler Corporation, Ford Motor Company, and General Motors Corporation (GM). 1 This PNGV agreement created a unique industry and government partnership with the broad objective of “strengthening U.S. competitiveness by developing technologies for a new generation of vehicles” (PNGV, 1995). These vehicles were to be conceived using new technologies to produce much lower national gasoline consumption and carbon dioxide emissions. The PNGV Program Plan recognized that, to have substantial impact, these vehicles must be sold in high volume (PNGV, 1995). This, in turn, requires that they meet all emission and safety requirements and include all of the characteristics that result in strong customer appeal. In addition to product redesign the program embraced research aimed at improving the effectiveness of the broad manufacturing enterprise, including everything from the development of new analytical tools to the use of new materials and manufacturing processes. The PNGV declaration of intent requires an independent peer review “to comment on the technologies selected for research and progress made.” In response to a request in July 1994 by the undersecretary for technology adminis- 1USCAR, which predated the formation of PNGV, was established to support intercompany, precompetitive cooperation to reduce the cost of redundant R&D in the face of international competition. Chrysler Corporation merged with Daimler Benz in 1998 to form DaimlerChrysler. USCAR is currently composed of a number of consortia, as shown in Appendix D.
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Page 14tration, U.S. Department of Commerce, on behalf of PNGV, the National Research Council established the Standing Committee to Review the Research Program of the Partnership for a New Generation of Vehicles. The committee annually reviews PNGV's research program, advises government and industry participants on the program's progress, and identifies significant barriers to success. This is the seventh review by that committee; the previous studies are documented in six National Research Council reports, which also contain background on the PNGV program and the committee's activities (NRC, 1994, 1996, 1997, 1998, 1999, 2000). Chapter 4, “Program Overview,” of the current report contains the committee's broad assessment of what has happened in the PNGV program during the past seven years. It also discusses program issues raised by changes that have occurred during this time and suggests that it may be time for a critical review of the program goals. The PNGV goals and the basis for all of the National Research Council reviews are articulated in the PNGV Program Plan (PNGV, 1995; The White House, 1993): Goal 1. Significantly improve national competitiveness in manufacturing for future generations of vehicles. Improve the productivity of the U.S. manufacturing base by significantly upgrading U.S. manufacturing technology, including the adoption of agile and flexible manufacturing and reduction of costs and lead times, while reducing the environmental impact and improving quality. Goal 2. Implement commercially viable innovations from ongoing research on conventional vehicles. Pursue technology advances that can lead to improvements in fuel efficiency and reductions in the emissions of standard vehicle designs, while pursuing advances to maintain safety performance. Research will focus on technologies that reduce the demand for energy from the engine and drivetrain. Throughout the research program the industry has pledged to apply those commercially viable technologies resulting from this research that would be expected to increase significantly vehicle fuel efficiency and improve emissions. Goal 3. Develop vehicles to achieve up to three times the fuel efficiency of comparable 1994 family sedans. Increase vehicle fuel efficiency up to three times that of the average 1994 Concorde/Taurus/Lumina automobiles with equivalent cost of ownership adjusted for economics. 2 As the committee has noted in previous reports and as noted in a number of other studies, achieving significant improvements in automotive fuel economy and developing competitive advanced automotive technologies and vehicles can 2As noted in the PNGV Program Plan (PNGV, 1995), the long-term goal of the PNGV program is to develop vehicles that will deliver up to 80 miles per gallon (mpg) or British thermal unit (BTU) equivalent. If an alternative source of energy is used, such as a diesel-powered vehicle or a fuel cell vehicle powered by methanol or hydrogen, the goal will be up to 80 miles per BTU equivalent of a gallon of gasoline (114,132 BTUs). Where values of mpg are used in this report with options not using gasoline, those mpg values are understood to be miles per equivalent gallon of gasoline. “Fuel consumption,” also used in this report as an index of energy use, is the reciprocal of fuel economy.
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Page 15provide important economic benefits to the nation, improve air quality, improve the nation's balance of payments, and reduce emissions of greenhouse gases to the atmosphere (DOE, 1997; NRC, 1992, 1997, 1998; OTA, 1995; PCAST, 1997; Sissine, 1996). The rise in international oil prices and in U.S. gasoline prices during 2000–2001 has created attention in the media about the cost of driving and fuel economy. Even with these price increases, gasoline prices still remain relatively low in real terms, and U.S. automobile purchasers have little incentive to consider fuel economy as a major factor in their purchase decisions. In addition, the sales of light trucks, especially sport utility vehicles (SUVs), which have lower fuel economy than automobiles, account for close to half of the vehicles purchased for personal use. The lack of market incentives in the United States for buyers to purchase vehicles with high fuel economy has made it difficult to realize public benefits from higher-cost components and designs that improve fuel economy. Nevertheless, Ford Motor Company, General Motors Corporation, and DaimlerChrysler Corporation have announced plans to increase the fuel economy of SUVs significantly by the 2003 to 2004 time period. The PNGV strategy of striving to develop an affordable automobile with a fuel economy of up to 80 mpg that maintains current performance, size, utility, and cost levels while meeting safety and emissions standards would circumvent the lack of economic incentives for buying automobiles with high fuel economy. If the PNGV strategy were successful, buyers could purchase vehicles with all the desirable consumer attributes, as well as greatly enhanced fuel economy; there would be no reason not to do so. The creation of such a vehicle, as the committee has noted in previous reports, is extremely challenging. This ambitious goal has, however, stimulated rapid development worldwide of essential technologies, verifying the strategic value of the PNGV program. Vehicles meeting Goal 3 requirements and the triple-level fuel economy may not be achieved, but many of the technologies developed in an attempt to meet Goal 3 may enter the market in a variety of production vehicles (Goal 2) (e.g., higher-efficiency engines, hybrid drive trains, and regenerative braking), thus providing a significant impact on vehicle fuel consumption. PNGV is a partnership aimed at simultaneously meeting both business and societal goals. It joins the extensive R&D resources of the national laboratories and university-based research institutions, together with the vehicle design, manufacturing, and marketing capabilities of both the USCAR partners and suppliers to the automotive industry. 3 Government funding for PNGV is primarily used for the development of long-term, high-risk technologies. Funding by USCAR and industry is generally used for the development of technologies with nearer-term commercial potential, the adaptation of government-laboratory technology devel- 3The U.S. Department of Commerce, the U.S. Department of Energy, the U.S. Department of Transportation, the Environmental Protection Agency, and the U.S. Department of Defense are the federal partners in the PNGV program.
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Page 16opments to automotive applications, and the production of proof-of-concept vehicles. Substantial in-house proprietary R&D programs related to PNGV are also under way at USCAR partner facilities. PNGV has created industry-government technical teams responsible for R&D on the candidate subsystems, such as fuel cells and four-stroke direct-injection engines. A manufacturing team, an electrical and electronics power-conversion devices team, a materials and structures team, and a systems analysis team are also part of the PNGV organization (NRC, 1996, 1997, 1998, 1999, 2000). Technical oversight and coordination are the responsibilities of a vehicle-engineering team, which provides the technical teams with vehicle system requirements supported by the systems analysis team. A safety working group has been formed since the committee's sixth review. PROGRAM PROGRESS At program inception, several milestones were established: a technology selection in 1997; concept vehicles in 2000; and production-prototype vehicles in 2004. The program has made substantial progress since its inception and has met major milestones thus far. At the end of 1997 PNGV made a technology selection based on assessments of system configurations for alternative vehicles. Several technology options—such as gas turbines, Stirling engines, ultracapacitors, and flywheels for energy storage—were eliminated as leading candidates. The 10-year span of the program dictated some of these choices. In its fourth review the committee agreed with PNGV's technology selections (e.g., four-stroke, internal-combustion engines, fuel cells, batteries, power electronics, and structural materials). The four-stroke compression-ignition direct-injection (CIDI) engine was selected as the most likely power plant to enable the fuel economy goal to be met within the program time frame; the fuel cell power plant was retained in the program as a highly promising longer-range technology. After the technology-selection process PNGV was able to concentrate its resources on fewer technologies with the intent of defining, developing, and constructing concept vehicles by 2000 and production prototypes by 2004 (PNGV, 1995). The second major milestone, the development of concept vehicles, was met in early 2000 and was a major program achievement. Using PNGV-developed technologies and their own in-house proprietary technologies, the USCAR companies each developed separate concept vehicles with fuel economies between 70 and 80 mpg. These were reviewed in the committee's sixth report (NRC, 2000). Early in the program the USCAR partners decided it would be impractical to design and build a joint concept car, a decision the committee supports. The three concept-car designs that resulted from this decision each made its own significant contribution to program goals. Clearly it is even more impractical for the development of production-prototype vehicles to be pursued in the cooperative part of
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Page 17the PNGV program. Proprietary issues require production prototypes to be designed, developed and built independently in a single company. With the development of the concept vehicles, and as the program approaches the 2004 deadline, the nature of the program is shifting. Greater effort is being expended by the USCAR companies as vehicle development, cost reduction, and overcoming manufacturing barriers become increasingly important. In addition, when the technologies under development become more mature and allow improvements in performance and reliability, along with reduced costs, they can be transferred into broader applications in the vehicle fleets. THE EVOLVING CONTEXT As with all programs, the context in which the PNGV program was first conceived has evolved, and public policy issues and the economic environment have changed. In assessing progress, reviewing activities, and making judgments about the future success of the PNGV program, it is important to keep a number of issues and changes in mind, some of which have been noted in previous committee reports: The power train with the highest probability of meeting the vehicle fuel-economy target of 80 mpg by 2004 is the hybrid-electric power train powered by a CIDI engine. In 1999 approximately midway through the program, the Environmental Protection Agency promulgated Tier 2 emission standards for particulate matter and oxides of nitrogen (NOx) substantially more stringent than those at the start of the program (Federal Register, 1999). This action brought into question the possibility of meeting these emission requirements with a CIDI engine in a production prototype by 2004. Consequently, a major portion of the program resources was reallocated to address this new development risk. Alternative power plants (e.g., homogeneous spark-ignition engines or gasoline-fueled direct-injection engines) with a higher probability of meeting the Tier 2 standards in the PNGV 2004 time frame would result in vehicles with reduced fuel economy compared with the CIDI engine. The market for personal vehicles has changed substantially during the past decade with the sale of light trucks (e.g., pickup trucks, vans, and SUVs) now accounting for about 50 percent of the vehicles purchased for personal transportation. Thus, the traditional family sedan that is part of PNGV's Goal 3 has become a less important component of the “automotive” market. These light trucks are heavier and bigger than automobiles and have lower fuel economy than typical sedans. From all the evidence the committee has seen during past reviews, the cost premium of a PNGV-type vehicle with a fuel economy close to 80
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Page 18mpg will likely be several thousand dollars more than a competing conventional vehicle. Without some form of incentive to overcome this increment, it is unlikely that such a vehicle would be cost-competitive in the market. Thus, the committee recommended during its last review that PNGV should direct its program toward an appropriate compromise between fuel economy and cost using the best available technology to ensure that a market-acceptable production-prototype vehicle that meets emission standards can be achieved by 2004. Concerns about the potential for global warming from emissions of greenhouse gases, such as carbon dioxide (CO2), have become more acute. This has resulted in voluntary agreements by the automakers in Europe and the creation of Japanese weight-class standards for fuel economy aimed at the reduction in CO2 emissions in the 2008–2010 time frame (Plotkin, 2001). Toyota and Honda have introduced hybrid-electric vehicles, the Prius and Insight, respectively, into the marketplace. They are much smaller than the vehicles under development in the PNGV program. Ford, General Motors, and Chrysler have all announced their intention to build some form of hybrid-electric vehicles for production by 2004. The PNGV also has pursued the development of fuel-cell-powered vehicles. Much progress in fuel cell technology has been made since the program started, and private companies worldwide are now devoting substantial resources to this effort. And finally, in 2001 the Administration has proposed and Congress is discussing an energy policy for the country. As of July 2001, it is too early to determine how this activity will affect the PNGV program. SCOPE OF REVIEW The 16-member committee (see Appendix A) that conducted this seventh review of PNGV was tasked as follows: The previous six reviews of the PNGV program critically assessed research progress and commented on a number of issues related to the efficacy of the program to meet its goals within the PNGV time frame. In continuation of this independent evaluation, in the Phase 7 review, the NRC Standing Committee to Review the Research Program of the Partnership for a New Generation of Vehicles will address the following tasks: 1. In light of the PNGV program technical goals and previous NRC Standing Committee recommendations, examine and comment on the overall balance and adequacy of the PNGV research effort, the rate of progress, and the technical objectives and schedules for each of the major technology areas (i.e., fuel cells, 4-stroke direct-injection engines and emissions control, power electronics & electrical systems [electric drive], energy storage, and structural materials). 2. In light of the emission requirements for the 2004–2010 time period, examine and comment on the ongoing fuels, propulsion engine, and emission-control research efforts to identify and develop commercially viable very-low-emission (e.g., California LEV-2
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Page 19and EPA Tier 2 standards) propulsion systems based on fuel cells and 4-stroke direct-injection engines. 3. Based on its own knowledge of worldwide developments of the technologies under development in the PNGV program, comment on whether PNGV is pursuing appropriate directions to overcome technical barriers. If, in the opinion of the committee, PNGV should be pursuing other approaches based on work ongoing outside of PNGV, the committee will recommend suitable approaches to be taken. The conclusions and recommendations in this report are based on the committee's meetings, presentations, and other data-gathering activities (see Appendix C). USCAR presented some material as proprietary information under an agreement signed by the National Academy of Sciences, USCAR, and the U.S. Department of Commerce (on behalf of the federal government).