Two-Mode Hybrid System: GM’s Larry Nitz on Lessons LearnedTwo-Mode Hybrid System: GM’s Larry Nitz on Lessons Learned

The Two-Mode Hybrid system for large sport utilities and trucks hasn’t exactly set the world on fire.
In 2006, General Motors, Daimler and Chrysler (then a single company) announced a partnership, soon joined by BMW, to develop the Two-Mode Hybrid system for large rear-wheel drive vehicles.
But Daimler and Chrysler split, two of the partners declared bankruptcy and were reconstituted with U.S. government funds, and the once-promising four-way partnership has been dissolved.
GM goes solo
Now GM is the sole proprietor (and largest user) of the Two-Mode system. Yet last year, GM sold just 8,820 Two-Mode Hybrids, the bulk of them full-size hybrid sport utility vehicles from Cadillac, Chevrolet, and GMC. Toyota, meanwhile, sold almost half a million Prius hybrids globally last year.
GM’s Larry Nitz, at the Hybrid Development Center in Troy, Michigan, in April 2006
In March, Chrysler’s Ram Truck brand (nee Dodge) killed its Ram Hemi Hybrid pickup truck, which was to use the Two-Mode system.
BMW and Mercedes-Benz use the Two-Mode only in small numbers of their X6 and ML crossovers, and are moving away from using the Two-Mode, preferring instead to evolve their own mild hybrid system.
With all that water under the bridge, we were curious how GM viewed the Two-Mode Hybrid project these days–and what lessons the reconstituted company felt it had learned from the project.
We spoke to Larry Nitz, who is GM’s executive director of electric and hybrid powertrain engineering. He said the company’s intent “was not to sell huge amounts of these in the early stages.”
Not aiming for high volume
Instead, Nitz said, “the intent is to learn” how they’re used and how they hold up to real-world conditions. And the same may apply to the second generation of the system as well, though perhaps in slightly higher quantities.
It’ll only be “by the third or fourth generation that the costs get lower,” Nitz said, and that’s when GM can go “much higher” in production volumes–perhaps just in time to meet the stringent fuel economy requirements that come into effect for 2016 and thereafter.

2010 Chevrolet Silverado Hybrid
Technology or vehicle type?
One of GM’s biggest learnings came around the issue of identifying vehicles as hybrids.
“Fundamentally, hybrid is a technology,” Nitz said, “an overall vehicle-efficiency technology.” An analogy might be fuel injection during the 1980s, promoted in chrome script letters on trunk lids, until over the course of a decade it became an unremarkable standard fitting.
But given the stage set by Toyota, with their dedicated Prius hybrid–distinct enough that it can be identified at 100 feet–customers may view “a hybrid” as a different type of vehicle.
The “desire by some people to have this truck as a rolling billboard for hybrid technology caught some people by surprise,” Nitz said.
“Hybrid customers have a lot of different reasons for buying,” and even though they need the capabilities of a full-size SUV, “they want people to know they’re environmentally conscious.”
2010 Chevrolet Silverado Hybrid
Hybrids “rather important” to customers
He attributed the late addition of hybrid “emblems, stickers, and logos” largely to GM’s then-product chief Bob Lutz. Pressed further, Nitz said, “Perhaps in our vigor to make these vehicles as truck-like and capable and highly refined” as their regular counterparts, “a few of us at the firm, in the thrill of battle, were not as sensitive to the uniqueness of what the customer is after.”
That identification “turned out to be rather important for those customers,” Nitz said–still sounding slightly surprised, years later–and “we were happy we could do it in a tasteful way.”
2009 Cadillac Escalade Hybrid
Conquest customers
Did the Two-Mode Hybrid SUVs and pickups attract new buyers, or come from GM’s existing base of customers?
They’re a blend of both, Nitz said cautiously, but “we have lots of data showing that if it hadn’t been a hybrid, [some customers] wouldn’t have chosen the Escalade” at all.
Those, he said, are “good, solid conquest sales” where the Cadillac Escalade Hybrid was compared not to its gasoline counterpart but to the Lexus RX 450h.
Pickup buyers: notorious
Pickup truck buyers, however, proved to be “the opposite side of the scenario,” since they’re “notoriously price sensitive.”
Consequently, only a tiny fraction of GM’s pickup sales–1,576, or far below 1 percent–include the hybrid option. Last week, the company touted sales of a few hundred hybrid pickups to Verizon.
2010 Chevrolet Silverado Hybrid

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