GM to power up Michigan Volt battery plant

General Motors (GM) will tomorrow move a major step closer to delivering its Chevy Volt plug-in electric hybrid as it begins production of the vehicles' battery packs at a plant in Michigan.

GM is receiving around $241m (£150m) in federal grants to help it to deliver the Volt, which is seen as central to efforts to revive the fortunes of the ailing manufacturer and cut US vehicle emissions.

Around $106m of the government funding has been invested in the battery pack assembly plant in Brownstown Township, which GM says will make it the first major US auto maker to operate such a plant.

While GM is assembling the packs, the batteries are being built by Korean company LG Chem's Compact Power. GM says that the partnership has allowed it to develop a core-competence in automotive battery engineering that will bolster its long-term competitiveness in the expanding market for electric and plug-in hybrid vehicles.

The company said that operating its own plant will also allow it to re-hire some of the autoworkers it has laid off over the years due to the downturn in its fortunes. Having US manufacturing capability was a prerequisite of US federal funding provided for the Volt project.

The Volt is scheduled to go on sale later this year and is expected to cost around $40,000.

According to GM, the plug-in hybrid technology will let commuters travel up to 40 miles on electric power alone. The engine then kicks in after its battery is drained to around 70 per cent capacity, at which point it operates like a normal hybrid. As a result, the car is expected to enjoy a total range of around 300 miles between fuelling stops.

Tomorrow's opening will be attended not only by GM and state officials but also by US Secretary of Energy Steven Chu, whose department has doled out bil lions of dollars to kick-start the US green car industry.