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Detroit, October 10 -- Texaco
(NYSE:TX) and General Motors (NYSE:GM) today announced
Texaco's intent to acquire GM's share of a joint venture
that has developed an advanced battery technology
for the automotive market.
Under the terms of the memorandum of
understanding, Texaco will acquire GM's 60 percent
share of an existing joint venture with Energy Conversion
Devices – ECD – (NASDAQ:ENER), a firm in which Texaco
already holds a 20 percent interest. GM and Ovonic
Battery Company, a subsidiary of ECD, formed the joint
venture, GM Ovonic, in 1994 to manufacture and commercialize
high-efficiency, nickel metal hydride (NiMH) automobile
batteries. The joint venture, which will be re-named
Texaco Ovonic, plans to fully commercialize and expand
its applications to a broad range of energy markets.
"ECD and Ovonic developed breakthrough
advanced NiMH battery technology and General Motors
has brought it to the production stage," said
Texaco Senior Vice President William M. Wicker. "With
the demand for all-electric and hybrid vehicles projected
to grow significantly over the next few years, the
time is right to extend this technology to the entire
automotive market and take it to the next level of
commercial development.
"This technology is already being
used as a source of power in items such as cellular
telephones and personal computers and we believe it
holds the potential to meet a wide range of non-automotive
uses. As a company committed to developing a significant
presence in the energy technology field, we are excited
to be part of this joint venture."
General Motors Vice Chairman Harry J.
Pearce said that the future of the battery-powered
electric vehicle relies on addressing the critical
issue of cost. Successfully addressing this issue
requires both high-volume applications and further
technical development.
"General Motors, ECD and Ovonic
led the industry in the initial commercialization
and technology development for advanced vehicle batteries,"
said Pearce. "Together, we improved the range
of our world class GM EV1 to more than 150 miles with
the GM Ovonic nickel metal hydride technology and
opened the door to more efficient hybrid vehicles
in the future. GM Ovonic's Kettering, Ohio, plant
is the first and only facility in the United States
dedicated exclusively to the production of NiMH batteries
for electric vehicles. We are very proud of these
successes and extremely pleased that Texaco will now
join with Ovonic and ECD to take the next step in
commercialization to reduce costs by spreading this
technology to many other automotive customers and
applications as well as to non-automotive uses. And,
we anticipate that Texaco Ovonic will be our supplier
for NiMH batteries."
In a joint statement, Stanford R. Ovshinsky,
ECD President and CEO, and Robert C. Stempel, ECD
Chairman, said, "This is a great transition for
Ovonic Battery. We started out with the support and
manufacturing development expertise of automotive
leader, GM, and now we will have the broad reach and
marketing expertise of global energy leader, Texaco.
"This is the right move at the right time for
the rights reasons – it's a win-win for our current
and future customers, the companies and consumers."
The Ovonic battery offers several significant
advantages over conventional batteries:
- More energy. The Ovonic battery has more than
twice the energy of conventional lead-acid batteries
of the same weight. This translates directly to
extended driving range between recharges.
- More power. Ovonic's NiMH technology is especially
adaptable for hybrid-electric applications that
require very high power levels.
- Long life. The Ovonic battery life cycle is four
times longer than conventional batteries, meaning
that one Ovonic battery can last the projected 150,000
mile lifetime of electric or gas-electric hybrid
vehicles.
- Less environmental impact. The Ovonic battery
is environmentally preferable, since it uses no
lead. The base material, Nickel, is highly reclaimable
as are the other metal alloys used in the battery.
- Versatility. The Ovonic battery can be used in
all types of automobiles – conventional, gas-electric
hybrids, all-electric vehicles and fuel cell vehicles.
The joint venture expects to manufacture batteries for
use in model year 2003 vehicles.
This press release contains a number of forward-looking
statements within the meaning of the Safe Harbor provisions
of the Private Securities Litigation Reform Act of 1995.
In particular, statements made concerning Texaco's and
ECD's expected performance and financial results in
future periods are based upon Texaco's and ECD's current
expectations and beliefs and are subject to a number
of known and unknown risks and uncertainties that could
cause actual results to differ materially from those
described in the forward-looking statements. The following
factors known to Texaco and ECD, among others, could
cause Texaco's and ECD's actual results to differ materially
from those described in the forward-looking statements:
inaccurate scientific data; mechanical, chemical and
technological failures; decreased demand for alternative
fuels and other products; above or below-average product
and technology demands; worldwide and industry economic
conditions; higher costs, expenses and interest rates;
the outcome of pending and future litigation and governmental
proceedings; continued availability of financing; and
strikes and other industrial disputes. In addition,
you are encouraged to review Texaco's and ECD's latest
reports filed with the SEC, including, but not limited
to, Texaco's Annual Report on Form 10-K filed with the
SEC on March 24, 2000, which describes a number of additional
risks and uncertainties that could cause actual results
to vary materially from those listed in the forward-looking
statements made in this press release.
Contacts:
Andy Norman (Texaco), 914-672-7438
Chris Gidez (Texaco), 914-253-4042
Jeff Kuhlman (GM), 248-680-5999
Lisa Lamont (GM), 248-680-5972
Ghazaleh Koefod (ECD), 248-280-1900
For additional information, visit www.texaco.com,
www.gm.com.
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