Peer Review of FEV Inc. Report
            "Light Duty Technology Cost Analysis,
            Power-Split and P2 Hybrid Electric
            Vehicle Case Studies"
&EPA
United States
Environmental Protection
Agency

-------
         Peer Review of FEV Inc.  Report
     "Light Duty  Technology Cost Analysis,
       Power-Split and P2 Hybrid Electric
                 Vehicle  Case  Studies"
                     Assessment and Standards Division
                    Office of Transportation and Air Quality
                    U.S. Environmental Protection Agency
                          Prepared for EPA by
                           ICF International
                       EPA Contract No. EP-C-06-094
                        Work Assignment No. 4-08
      NOTICE

      This technical report does not necessarily represent final EPA decisions or
      positions. It is intended to present technical analysis of issues using data
      that are currently available. The purpose in the release of such reports is to
      facilitate the exchange of technical information and to inform the public of
      technical developments.
United States
Environmental Protection
Agency
EPA-420-R-11-016
November 2011

-------
1.   Introduction	1
2.   The Peer Review Process	1
3.   Summary of Peer Reviewer Comments	3
    3.1.   Comments on Methodology/Results	3
          a. Reasonableness and Potential Bias of the Methodology as Documented	3
          b. General Flaws in the Scope of the Study	4
          c. Appropriateness of Study Inputs	5
          d. Reasonableness of Assumptions	5
          e. Appropriateness of Results	7
          f. Appropriateness of Scaling Costs to Other Vehicle Classes and to Other Hybrid Technologies	7
    3.2.   Comments on Other/General Observations	8
4.   Verbatim Peer Reviewer Comments in Response to Charge Questions	8
Appendix A:  Charge to Peer Reviewers	A-1
Appendix B.  Reviewer Resumes  	B-1
Appendix C.  Peer Reviewer Comments As Submitted	C-1

-------

-------
The U.S. Environmental Protection Agency's (EPA's) Office of Transportation and Air Quality (OTAQ)
is developing programs to control greenhouse gas (GHG) emissions from light-duty highway vehicles,
which require an evaluation of the costs of technologies likely to be used to meet any standards. EPA
contracted with FEV Incorporated to perform this cost analysis through tearing down vehicles, engines,
and components, both with and without these technologies, and evaluating, part by part, the observed
differences in size, weight, materials, machining steps and other cost-affecting parameters. Though
complex and time-consuming, EPA believes this approach has great potential for determining accurate
technology costs, a goal that is of paramount importance in the setting of appropriate GHG standards.

Although the teardown and analysis work is ongoing, FEV  wrote a report detailing the methodology it
and its subcontractor are using to cost out technologies and describing the results of the cost-out work to
date.1 To assure that this work incorporates the highest quality science, EPA contracted with ICF
International (ICF) to determine appropriate independent peer reviewers for the FEV report, "Light Duty
Technology Cost Analysis, Power-Split and P2 Hybrid Electric Vehicle (HEV) Case Studies" and
document their feedback on the costing methodology it presents. The reviewers selected were
independent subject matter experts  and their reviews were conducted in compliance with EPA peer
review guidelines.2

This report presents  the findings of the reviews conducted by four subcontracted subject matter experts.
The peer reviewers were:

    1.   Mr. Ted Bohn, Argonne National Laboratories
    2.   Dr. Linos Jacovides, Delphi (Retired)
    3.   Ms. Linda Miller, independent consultant
    4.   Dr. Deepa Ramaswamy, Hybrid Chakra
From December 2010 to April 2011, EPA contracted with ICF to coordinate this peer review. ICF
implemented the peer review in compliance with EPA's Peer Review Handbook (3rd Edition).2 EPA
requested that the peer reviewers represent subject matter expertise in manufacturing cost estimating
and/or automotive design.

ICF developed a list of candidate peer reviewers from the following sources: (1) ICF experts in this field
with knowledge of relevant professional society membership, industry, academia, and other
organizations, and (2) suggestions from EPA staff.  ICF identified 25 qualified individuals as candidates
to participate in the peer review. ICF sent each of these individuals an introductory screening email to
describe the needs of the peer review and to gauge the candidate's interest and availability. ICF attached
to the email the reviewer charge to ensure each candidate was familiar with the scope of work. ICF also
1 Draft Report FEV07-069-303F, February 22, 2011.
2 EPA's Science Policy Council. Peer Review Handbook, 3rd Edition (http://www.epa.gov/peerreview/).OMB's Information Quality
  Bulletin for Peer Review and Preamble (also in the EPA's Peer Review Handbook, Appendix B).

-------
                                      The Peer Review Process
asked candidates to provide an updated resume or curriculum vitae (CV).  Several candidate reviewers
were unable to participate in the peer review due to previous commitments, and several others did not
respond. ICF reviewed the responses and evaluated the resumes/CVs of the interested and available
individuals for relevant experience and demonstrated expertise in the above areas, as demonstrated by
educational degrees attained, research and work experience, publications, awards, and participation in
relevant professional societies.

ICF reviewed the interested, available, and qualified candidates with the following concerns in mind.  As
stated in the EPA's Peer Review Handbook, the group of selected peer reviewers should be "sufficiently
broad and diverse to fairly represent the relevant scientific and technical perspectives and fields of
knowledge; they should represent a balanced range of technically legitimate points of view." As such,
ICF selected peer reviewers to provide a complimentary balance of expertise of the above criteria.

EPA reviewed ICF's proposed peer reviewers and concurred with ICF's recommendations; these peer
reviewers were listed in the introduction. Exhibit 1 shows the representation of the peer reviewers in the
required areas of expertise.

                Exhibit 1. Chart of Peer Reviewer Expertise Areas and Affiliation
Expertise Areas/
Affiliation
HEVs
Cost Modeling
Manufacturing
Mass Production
Tier 1 Supplier
Original Equipment
Manufacturer (OEM)
T. Bohn,
Argonne
National
Laboratories
^
S




L. Jacovides,
Delphi (Retired)
^

^
^

V
L Miller,
independent
consultant
^

^
^


-------
                                Summary of Peer Reviewer Comments
ICF provided peer reviewers with the following materials:

    •   Draft report by FEV, Inc., entitled, "Light-Duty Technology Cost Analysis Power-split and P2
       HEV Case Studies," dated February 22, 2011;
    •   The Peer Reviewer Charge to guide their evaluation; and
    •   A template for the comments organized around the Peer Reviewer charge.

The Peer Reviewer Charge provided peer reviewers with general guidelines, as well as example
questions, for preparing their overall review, with particular emphasis on methodologies and cost results.
In addition, EPA asked each reviewer to provide recommendations on the "overall adequacy of the model
for predicting future battery prices, and on any improvements that might reasonably be adopted by the
authors to improve the model."

A mid-review teleconference was held on March 8, 2011, to discuss the charge, the purpose of the review,
and to answer any outstanding questions the reviewers might have.  The call was moderated by ICF and
attended by reviewers Mr. Bohn, Dr. Jacovides, Ms. Miller, and Dr. Ramaswamy, as well as EPA staff
Brian Nelson, and FEV, Inc. staff Greg Kolwich who were familiar with the report.

The charge to peer reviewers is provided in Appendix A. The CVs or resumes for the reviewers are
included in Appendix B.
This section presents a brief summary of the various comments received from the peer reviewers. The
intention here is to convey the overall results of the individual peer reviews in a concise summary
highlighting any lessons learned.

This summary is organized into two categories, issues related to study methodology and results and
general observations of the study. Editorial comments were excluded from this summary and may be
found in the full verbatim comments that are provided in Section 4.
Dr. Jacovides stated that the methodology is correct and can lead to correct results, as he had familiarity
with the approach and expected results from prior work. Given that familiarity, he felt the report
represented a superb implementation of the concept and that the analysis of the HEV and internal
combustion engine  (ICE) equivalent was done very carefully, correctly, without any obvious bias, and
achieved results in agreement with his own. Mr. Bohn agreed generally, but only for the baseline HEV.

However, two other reviewers expressed skepticism. Ms. Miller felt that the methodologies are generally
reasonable, but raised some specific concerns, including a lack of documentation proving accurate results.
Specifically, she noted that, while the paper references marketplace validation, no examples were given.
Dr. Ramaswamy agreed that the report does not sufficiently document the validation of the methodology
at a subsystem or a system level. The implication was that, while the bottom-up approach was highly
detailed, insufficient data was given in the report to show that the resulting subsystem or system costs

-------
                                 Summary of Peer Reviewer Comments
agreed with those developed or published by other reasonable sources.  Ms. Miller also noted that the
methodology only predicts absolute costs, and that a sensitivity analysis should be included and
documented.  Dr. Ramaswamy agreed that the methodology for determining costs is generally
reasonable, but highlights some significant exceptions. Specifically, engineering development costs and
use of indirect cost multipliers (ICMs) was not considered in sufficient detail and may be incorrect. An
example was given (see specific comment excerpt number 8 in Table 1) where ICM costs are incorrectly
applied to the OEMs. This would introduce bias to lower predicted costs beyond reality, thus the
engineering development costs for the subsystems should be revised.  Ms. Miller also noted that the
scaling methodology appeared to be overly simplified when it was applied to labor and manufacturing
overhead. Whereas the cost of direct labor is more a factor of part complexity than one of size, certain
elements of overhead costs were only minimally affected by part size. This could introduce bias that
should be explored through use of sensitivity tests.

The only key limitation Dr. Jacovides noted is that the methodology was limited to the two architectures
studied (split power hybrids used by Toyota and Ford and, to a limited extent, Hyundai's P2 architecture).
While he noted that the P2 battery was properly analyzed by tear down of an actual unit and could be
extended to other hybrids (GM [two mode and the Malibu ISG] and the Honda Insight), Mr. Bohn
expressed skepticism about the general subjectivity of the scaling assumptions, particularly for P2 HEVs,
but, while noting that bias was possible, he made no judgment on its direction or magnitude. However, a
general consensus seemed to be that the P2 HEV results were more likely to be erroneous than the scaling
to other vehicle types, which was, in turn, likely to be more erroneous than the results for the baseline
vehicles.

                    ' '
Mr. Bohn suggested that the scope is "just right" and offered no conclusive statements. He noted that
expanding the scope of the study would likely introduce more variability and that reducing it would not
necessarily increase its validity or accuracy.

Dr. Jacovides said that, although beyond the  scope of this report, the study results would be meaningless
without knowledge of appropriate use of ICMs. This was a limitation of the study—the study may be
sufficiently detailed exclusive of ICMs, but end results could vary by up to a factor of two depending on
the ICMs.

As introduced previously, more substantial concerns were raised over the  scaling of results, especially to
P2 HEVs. Dr. Jacovides expanded on the comments from part (a), expressed concerns about both the
methods and results for the P2 system.  While the results of scaling for the P2 system may be in the right
direction, the sizing of the electrical system (power electronics and the electrical machine) were likely
incorrect.  Because the duty cycle of the electrical system in a P2 HEV is very different than that of the
power split HEV, the ratios of copper to iron in magnets will likely be different. Further, if the electrical
machine for the P2 was sized based on power, this was incorrect.  Instead, torque and duty cycle are the
primary determinants of size (and cost). Also P2 HEVs have a clutch to disconnect the engine so that
regenerative braking does not have to be reduced to provide for engine friction thus providing an all
electric range (AER). The resulting 32.4kW power of the electrical machine will not provide sufficient
required torque and power for AER.  Further, since the size of electrical machine is determined by torque,
not power, a slower speed machine will be heavier which contradicts  the assumed 20% vehicle curb

-------
                                 Summary of Peer Reviewer Comments
weight reduction for the P2 architecture for all vehicle segments.  Dr. Ramaswamy agreed that the
assumption of a 20% power and weight reduction assumed for the P2 hybrid may be unjustified.  Further,
she found that there is no justification in other literature that the Lithium Polymer battery (as opposed to
nickel metal hydride [NiMH]) would be a better long term solution for the P2 hybrid.

Dr. Jacovides argued that the study will be difficult to apply to other vehicles or architectures without the
detail provided by a similar tear-down. Ms. Miller agreed that extrapolation to other vehicle sizes cannot
be done without the basic underlying detailed studies, and that extrapolation of costs for vehicles other
than the Fusion relies on use of scaling and does not have the same level of detail as the rest of the study.
A different use of scaling factors, such as by applying scaling factors to material cost and investment in
equipment instead of for manufacturing cost and burden could yield a very different result.

The general consensus was that the scaling portion of the study was the most dubious.
Dr. Jacovides reiterated his contention that the report's central analysis (comparison of a hybrid and an
ICE Fusion) was very well done.  However, he raised concerns with estimation of the following cost
assumptions: 1) development of control software, 2) integration of the electrical and mechanical parts,
and 3) calibration.  All are upfront engineering costs that should be considered as part of the cost of the
vehicle, although they may be insignificant by the time production volume has reached 450,000 units.

Ms. Miller was concerned that lack of communication with the OEM's - while consistent with EPA
policy - can lead to inappropriate validation of the teardown costing. Dr. Ramaswamy agreed that
insufficient independently determined system/subsystem costs were used to validate the  calculated costs.
The report does discuss this, but specific examples of validation should be considered as additional inputs
to the process.

Dr. Ramaswamy also argued that the major flawed assumption of this study was that the high voltage
battery will be manufactured in the United States. NiMH batteries are not manufactured in volume in the
United States. Although several companies have plans to manufacture Li-ion batteries, the cells typically
come from Asia. This inaccurate  assumption biased the cost results high.
Reviewers noted concern about several assumptions included in the study. Dr. Jacovides again noted his
general conclusion that while the assumptions used are appropriate, the implicit assumption that a
downstream user without the same expertise as FEV would be able to run the model is unlikely. Dr.
Ramaswamy agreed that assumptions were generally reasonable, but highlighted especially the
unreasonable assumption incorporated in the scaling parameter for the battery.

Ms. Miller listed the following specific assumptions that should be re-considered:

    •  The assumption that the technologies used may be considered mature should be evaluated.  The
       assumption of maturity impacted numerous underlying cost elements, including lack of
       allowances for learning, scrap rates, non-recovered engineering, design, and testing (ED&T)
       expense and capital costs, and equipment end of life costs.

-------
                                Summary of Peer Reviewer Comments
    •   The assumption that no new or modified equipment maintenance is required is inconsistent with
       equipment at the end of its life cycle, assumed above. Together, these biased the cost estimates
       low.

    •   The assumption that integration of new technology would be planned and phased in to minimize
       non-recoverable expenses would be cost effective. In reality, new technology requirements to
       achieve fuel economy improvements and emissions reductions will preempt this consideration.

    •   The markup rate needs to vary dependent upon the part size and part complexity. If tolerance
       limits are not considered part of part complexity, tolerances need to be considered as another
       factor in determining scrap rates.  Assumed scrap rates should also be verified.

    •   The assumption that all sourcing/manufacturing centers will be in the United States was not valid
       and could bias the results high or low.

    •   Assumed labor rates may need to be adjusted to include overtime costs and other premiums.  It
       was unclear from the report if this was included and could bias the results, depending on union
       agreements and/or operating practices.

    •   Packaging cost assumptions should  be checked, based on the sample calculation (page 50, Figure
       C-6).

    •   Allowances for a percentage of pallets/racks out for cleaning/repair are not included and biased
       the packaging cost low.

    •   The assumed Cost of Complexity is inappropriate. Volumes of 450,000 per year assumed that the
       major complex assemblies (engine, transmission, and complex subsystems) are produced on
       dedicated lines. If they are not, then a cost of complexity factor needs to be added.  The 75%
       combined utilization/efficiency assumption was reasonable unless hybrid components are
       assembled on the same lines as the baseline products (as they will be), in which case this
       utilization/efficiency is  over-stated.  This biases the results low; additional complexity should be
       factored into the utilization/efficiency calculation.

    •   With respect to System Scaling Cost Analysis, ratios used to develop sizes and material costs for
       HEV components (traction motors, high traction batteries, etc.) were appropriate, but use of these
       ratios to determine other factors (especially labor and P2 HEV powertrain components) was less
       valid. These are more related to part complexity than part size.  Which costs are scalable should
       be reevaluated.

Mr. Bohn discussed some assumptions, particularly regarding the base vehicle and the P2 Hybrid having
equivalent performance with increased fuel economy. He said associated assumptions about the amount
of engine blending and depth of battery discharge were subjective and expressed concerns regarding the
lack of electric machine rating standards.  However, he made no mention of their reasonableness or
direction of influence on the study's results.

-------
                                 Summary of Peer Reviewer Comments
p  AiiiiiiTiiiriijitwrif**?4? nf Ft i**? nit*?
\f a tf I |J |J II \/ |J [I II €1 i\# Hi %*    *   •  * • \& ii  IT \<& ii !! ii \$
Generally reviewers seemed to express more reservation about the scaled results than the baseline
vehicles, for a variety of reasons.

Dr. Jacovides noted that scaling for vehicles with identical architecture but different power
inappropriately account for labor.  Similarly for P2 HEVs, costs for electrical machines should not be
scaled as power, but on torque and duty cycle.  Ms. Miller agreed that the ratios used to size HEV
components was appropriate for material costs and investment in equipment, but that using the size ratio
scaling methodology for overhead cost, direct labor costs, and required staffing was inappropriate. She
had these same concerns with scaling for the P2 HEV calculations.  Dr. Ramaswamy also agreed that for
most components, the scaling to other vehicle classes was reasonable. Mr. Bohn added that while the
approach used in scaling appears reasonable, he had concerns that the actual values used in the scaling
approach could be off and lead to erroneous results. However, this was not supported by his general
conclusion above regarding the reasonableness  of results.

Mr. Bohn and Dr. Jacovides commented that the NiMH battery scaling was done correctly, although Dr.
Jacovides noted that scaling did not consider an alternative approach of using a larger number of smaller
cells.  He believed that the approach used for the P2 architecture was directionally correct but the results
would not be as accurate as those between the baseline  hybrid and ICE vehicles. Although he noted that
the estimated cost of the cells seemed reasonable, Dr. Jacovides raised two questions about the treatment
of the Li-ion battery: 1) that discussion should be added to explain preservation of battery life when
scaling by nominal kWh, and 2) that clarification should be made on what size battery is cost for the P2
HEV.  Dr. Ramaswamy agreed. She noted that scaling of parameters across different vehicle classes
needed to be better explained and justified, given that this one component was responsible for the bulk of
the cost of the hybrid powertrain.

-------
                    Verbatim Peer Reviewer Comments in Response to Charge Questions
General comments not included in the earlier sections are discussed in this section.

Ms. Miller complemented the detail and effort of the analysis and report and the use of recognized
methodologies. Dr. Ramaswamy noted a small number of omissions and discrepancies.  She noted that,
while the report talked about the applicability of the power split hybrid system to the sub-compact, small,
large, and minivan vehicle segments, it should clarify that this group also covers small SUVs such as the
Ford Hybrid Escape, which is one platform that already supports this architecture.

Dr. Ramaswamy also noted several specific items of concern. She indicated that the study seemed to
omit a high-voltage DC/DC converter used by the traction motor and generator, which is used in the
Fusion Hybrid and should be included in the cost.  Table E-2, compared to those in Table D-3, showed
inconsistencies that should be addressed. Dr. Ramaswamy also noted that Table A-l should have
calculated the percentage increase as compared to the base non-hybrid vehicle cost, instead of calculating
the increase with respect to the mid/large size vehicle segment cost. Also, in Figure B-l, she questioned
why the bill of materials (BOM) was not updated after step 6, when additional information has been
gained about the component after its disassembly.  She also asked what the 19,149 parts stand for on page
50, first paragraph.

Dr. Ramaswamy also believed the methods for determining the engineering design costs for various
components/systems were unclear. These included: 1) the Atkinson engine engineering design cost,
associated control system, and calibration; 2) the engineering design cost for the electronics controllers,
software for the battery system, and mechanical design of the battery system (the numbers presented
appear low); 3) the ED&T for the traction battery assembly (too high relative to that for the control
module, given the relative engineering efforts) (Table D-l 1).

Dr. Jacovides recommended specific companies that should be consulted to assess the accuracy of results:
Ford for the baseline vehicles and those scaled according to size and Honda or GM for scaling to P2
HEVs. Also, individual component costs should be compared to those used  on the Volt and Leaf.

Ms. Miller also noted that validity testing of the Munro & Associates software, FEV databases, and
costing algorithms should be performed and documented.  Hypothesis testing  of assumptions concerning
burden rates, product maturity, etc. and sensitivity  analysis to demonstrate correlation to actual
component costs should also be added to the study.
Table 1 presents the verbatim comments received by the three subject matter experts.  Comments are
sorted by charge question and then topic/categories. Appendix C provides the actual peer reviewer
comments.

-------
                          Table 1. Sorted, Verbatim Comments from Reviewers
    Charge
Question Topic
Methodology/
Results

Methodology/
Results
     Specific
  Assumption/
      Topic
Methodological
Issues

Methodological
Issues
 Com-
 ment
Excerpt
  No.
   1
Reviewer
  Bohn
             Bohn
Methodology/
Results
Methodological
Issues
             Bohn
Methodology       Methodological
                                 Bohn
Results
Issues
                 Comment Excerpt
Overall, the draft document presents a generally
reasonable methodology that is likely to yield accurate
results.
            The assumptions used for the P2 HEV system are
            somewhat subjective on adding the P2 functionality as an
            80/20 power sharing between engine and motor for peak
            conditions.  This may introduce a bias in the results of the
            benefit vs the component cost, or in this case incremental
            costs. The assumption about engine downsizing is that the
            base vehicle and the P2 Hybrid will have equivalent
            performance with increased fuel economy. While peak
            performance is straight forward to assess for both the
            baseline and P2 Hybrid versions, the amount of engine
            blending, depth of discharge of the batteries, etc will affect
            the assessed fuel economy.
            It is difficult to assess the direction of the bias (cost or
            performance/F.E. mismatch)- i.e. component sizing is cost
            sensitive and depending on the engine/motor torque
            blending, component cost may be over stated or
            understated based on blending assumptions and
            equivalence the to the base vehicle.

Methodology/
Results
Mothnrlnlnnv/

Methodological
Issues
Mothnrlnlnniral

5
R

Bohn
.larnuirloc
                       There is no simple remedy for this supposed bias since
                       engine downsizing and component sizing are subjective
                       based on the desired performance attributes to compare
                       the hybrid version to the base vehicle. The assumptions
                       made in the report (section A) are fair, and clearly stated.
                       As with many vehicle simulations, the component scaling
                       methodologies need validation. In some industries,
                       component scaling is limited to technology or performance
                       ranges.  For instance IGBT transistors versus MOSFET
                       transistors are used for two different voltage ranges with
                       some overlap. Even so, the scaling assumptions are
                       bounded by the available voltage limit for the transistors.
                       Scaling up power ratings on an inverter, or battery voltage
                       have impacts on the scaled inverter costs, caused by (for
                       instance) the boundary where one would use MOSFETs
                       for lower voltage and IGBTs for high voltage.
                       The methodology is clearly correct and could lead to
                       correct results. As stated above, I  am familiar with the
                       approach because it was discussed during the NRC
                       committee on "Improving the Fuel Economy of LDV and in
                       the references listed earlier.  The report, under review,
                       represents a superb implementation of the concept.

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/
Results
Methodological
Issues
Methodology/
Results
Methodological
Issues
Methodology/
Results
Methodological
Issues
Methodology/
Results
Methodological
Issues
10
Jacovides   The analysis of the Ford Hybrid and cost comparisons with
            its ICE equivalent is done very carefully and correctly
            without any bias that I can detect. Interestingly the
            increase in cost of $3435 that this report comes up with is
            almost identical to the one we came up for the Prius in the
            NRC study of $3385.  We did that by talking to OEM's and
            suppliers.  However I want to emphasize that the approach
            taken by this report is far superior.  As long as a detailed
            design or an actual vehicle is available this is the way to do
            it. It does require a great deal of industrial engineering skill
            to estimate the amount of labor, and cost of materials but
            in the hands of FEV this has produced excellent results
Jacovides   It should be pointed out that the methodology is limited to
            the two architectures studied viz. split power hybrids as
            implemented by Toyota and Ford and to a limited extend
            on the P2  architecture as implemented by Hyundai. I say
            limited since there was no design available for the
            electrical machine in this case.  The battery for the P2 was
            properly analyzed by tear down of an actual unit.
            Nevertheless the analysis can be extended to other
            hybrids such as the two types made by GM (two mode and
            the Malibu ISG) and the Honda Insight
  Miller     • While the methodologies, for the most part, appear
            reasonable, there are some areas of concern. There is a
            lack of documentation in the paper proving that the
            methodologies yield accurate results.  While the paper
            references marketplace validation, no examples are given.
            • Recommendation:  Include examples taking developed
            costs for items such as fuel injector assemblies(Figure C-3,
            page 45, Sample MAQS Costing Worksheet); extrapolating
            these to a total cost using the approach outlined in the
            paper; and then comparing these costs to actual
            marketplace pricing for the example used.  One or two
            worked examples of this nature would  help to validate the
            overall methodology.  Alternatively, include a table,
            detailed by component/ sub-assembly, showing the
            methodologies and comparisons used for costing each
            item.
  Miller     • The costing methodology, as presented, develops costs
            that are absolute.  Given the complex nature of the end
            product and the manufacturing processes, it would have
            been appropriate to include sensitivity  analysis  in the
            costing detail.  If sensitivity analysis has been performed
            on a sampling of costs, it is not shown in the paper.
            • Recommendation: Assuming sensitivity analysis is
            available,  show the impact of sensitivity analysis in the
            examples  in the paper.  If sensitivity analysis has not been
            performed, then this is an area of detail that needs to be
            completed.  From a manufacturing perspective, sensitivity
            analysis on high dollar components needs to include scrap
            rates, mean time to repair of equipment, equipment
            uptime, etc.
                                                        10

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/      Methodological          11          Miller      The scaling methodology appears to be overly simplified.
Results            Issues                                       For example, scaling factors are applied to labor and
                                                              manufacturing overhead. The cost of direct labor is more a
                                                              factor of part complexity than one of size. Also, certain
                                                              elements of overhead cost such as salaries and front office
                                                              costs are not impacted, or at most minimally, by part size.
                                                              •Recommendation:  A deeper review of the approach to
                                                              scaling needs to be undertaken to insure that costs are not
                                                              under/over-stated. Again, applying sensitivity tests may
                                                              help determine whether or not these differences are
                                                              significant.
Methodology/      Methodological          12          Miller      Without the documentation noted above, it is not possible
Results            Issues                                       to say whether or not bias has been created.
Methodology/      Methodological          13       Ramaswamy   The methodology for determining the costs are generally
Results            Issues                                       reasonable, with some significant exceptions that are listed
                                                              below.
                                                              • The first is the engineering development cost, which
                                                              appears to have been not considered in detail in this
                                                              report. An example of these are the costs to develop
                                                              control  systems, be they battery control systems or
                                                              otherwise.  They cannot be lumped in with the indirect cost
                                                              multipliers  (ICMs), because these costs are not borne by
                                                              the OEMs. Rather, these are costs borne by the suppliers.
                                                              The bias introduced by this is that the overall cost of some
                                                              components is lower than it should be.  The remedy for this
                                                              is to revisit the engineering development costs for the
                                                              subsystems.
Methodology/      Methodological          14       Ramaswamy   What this report does not document sufficiently is the
Results            Issues                                       validation of this methodology at a subsystem or a system
                                                              level. The bottoms up towards cost that is employed by
                                                              FEV is  certainly very detail oriented, but there isn't
                                                              sufficient data in the report to show that the final
                                                              subsystem or system costs that they result in, are inline
                                                              with those  developed or published by other reasonable
                                                              sources
Methodology/      General Flaws          15          Bohn      The scope of the document is broad reaching. Expanding
Results                                                        the scope of the study would likely introduce more
                                                              variability with increased assumption.
Methodology/      General Flaws          16          Bohn      The scope does not need to be reduced since it covers
Results                                                        many aspects on the cost of producing an automobile and
                                                              reducing the scope would not necessarily increase the
                                                              validity or accuracy of the study.
Methodology/      General Flaws          17       Jacovides    The results of this study cannot properly be evaluated
Results                                                        without knowledge of what EPA considers the 1C factor to
                                                              be.  I realize that this is not in the scope of the report.
                                                              However 1C factors range from 1.02 to  1.45 as stated in
                                                              reference 5. Industry RPE factors were estimated in
                                                              Reference 4 to be 1.5 or 2.0 depending on whether parts
                                                              were bought or made in house.  One can calculate
                                                              manufacturing costs to the penny but then  the end result
                                                              can vary by a factor of up to two depending on the
                                                              multiplier
                                                        11

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/      General Flaws          18      Jacovides    The results for the P2 may be directionally correct, but I am
Results                                                        concerned about the sizing of the power electronics and
                                                              the electrical machine.  FEV should have bought a Honda
                                                              Insight (IMA), available in the US in the spring of 2010, or a
                                                              GM Malibu (ISG) for a tear down of the electrical system
                                                              (Power electronics and machine).  The duty cycle of the
                                                              electrical system is very different than that of the power
                                                              split and so the ratios of copper to iron to magnets will
                                                              likely be different. Also it seems from Table F2 that the
                                                              electrical machine was sized based on power. As
                                                              discussed below torque and duty cycle are the primary
                                                              determinants of size and hence cost.  It should be pointed
                                                              out that P2 has a clutch which provides two features that
                                                              the Insight and  the Malibu do not have. The clutch can
                                                              disconnect the engine so that regenerative braking does
                                                              not have to be reduced to provide for engine friction and
                                                              can provide an  all electric range (AER).  The 32.4kW
                                                              power of the electrical machine will not provide the
                                                              required torque and power. There should be a statement
                                                              to the effect that the P2 is not designed to provide an AER
Methodology/      General Flaws          19      Jacovides    Another problem is the assumption of a 20% vehicle curb
Results                                                        weight reduction for the P2 architecture and for all vehicle
                                                              segments.  Such a reduction does not come for free and  I
                                                              found no rationale for this.  In reference 4 we found that a
                                                              10% reduction in a 3600 Ibs vehicle would add around
                                                              $700. During the conference call it was implied that the P2
                                                              electrical systems is lighter. This may not be so and
                                                              certainly not by 20%. The speed of the P2 electrical
                                                              machine is not an independent variable and it is much
                                                              lower than the speeds of the two power split machines.
                                                              The size of electrical machines is determined by torque
                                                              and not power and so a slower speed machine will be
                                                              heavier. Clearly getting an Insight or a Malibu would have
                                                              given a better estimate.
Methodology/      General Flaws          20      Jacovides    Another flaw of the study is that it depends on the ability of
Results                                                        the people using the study to turn the crank for other
                                                              vehicles or for vehicles without the detail provided by a
                                                              teardown. Clearly FEV has demonstrated that it is
                                                              developing that knowledge, although I am not sure about
                                                              the accuracy of the electrical systems numbers for the P2.
                                                              The question then becomes "will EPA need FEV in the
                                                              future in order to use this work".  Based on  the conference
                                                              call with EPA, FEV and the Reviewers, this study will not
                                                              be used for other architectures so the above point is moot.
                                                              However I would like to caution that any extension to other
                                                              architectures needs to be done by skilled manufacturing
                                                              engineers and cost analysts.
                                                        12

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/
Results
General Flaws
21
Methodology/
Results
Methodology/
Results
General Flaws
22
General Flaws
23
Methodology/
Results
Appropriate Inputs       24
   Miller      • I do not see any general flaws inherent in the scope of
             the study.  Extrapolation to other vehicle sizes could not be
             done without the basic underlying detailed studies.
             However, once the component costs had been developed
             for the Fusion, the justification for the extensive use of
             scaling factors to approximate these costs for other vehicle
             lines does not have the same level of detail as  the rest of
             the study.  Whether or not this has been impacted by the
             scope of the project can not be determined.
             • Recommendation: Review the application of  scaling
             factors, especially for manufacturing cost and burden.  The
             methodology described in the paper yields a result that
             should be considered as one end of a range estimate.  The
             other end of the estimate should be developed by applying
             scaling factors to material cost  and investment in
             equipment and holding the other costs constant.  If it is
             necessary to state an absolute cost, the pick a  middle
             ground between these two numbers based on expert
             opinion.
Ramaswamy   Although not a flaw per se, it is not clear why the 20%
             power and weight reduction was assumed for the P2
             hybrid. This was the direction provided by the EPA to FEV,
             but the rationale for this is not clear, and this reviewer
             could not see why it is justified.
Ramaswamy   Secondly, the reports stated that the team felt that the Li
             Polymer battery (as opposed to NiMH) is a better long term
             solution  for the P2 hybrid. It's unclear if this was the EPA
             team or  the FEV team. Either way, there is no good
             rationale provided for such a statement,  and this  reviewer
             has not seen data (even outside of this report)  to justify
             such a statement.
   Bohn      The scope and breadth of inputs used for the study and
             cost assessments are broad and apparently all
             encompassing.  There are many input items on  costs,
             such as  labor rates and overhead on labor, which are
             outside the expertise of this reviewer. To the best of my
             knowledge, all the inputs used  in this study are
             appropriate.
                                                        13

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/
Results
Appropriate Inputs
Methodology/
Results
Appropriate Inputs       26
Methodology/
Results
Appropriate Inputs
Methodology/
Results
Appropriate Inputs
Methodology/
Results
Assumptions in
Model
25       Jacovides   When it comes to the main part of the report i.e. the
                     comparison between a hybrid and an ICE Fusion
                     everything seems to be done very well. Possible
                     exceptions are in estimating the following costs
                     1 .Development of control software.
                     2.Integration of the electrical and mechanical parts.
                     S.Calibration. Hybrid vehicles are more complex and to
                     make performance transparent to the driver is expensive.
                     Safety also requires extensive calibration. Toyota has
                     recalled the 2010 Prius to fix software when braking on ice
                     on bumpy roads. If this can  happen to Toyota with 10
                     years experience on hybrids, it must be taken seriously.

                     These are upfront engineering costs and by the time
                     production volume has reached 450k units may not be
                     significant. However they need to be added to the cost of
                     the vehicle.
           Miller     Although, as explained in the conference call on March 8,
                     2011, it is EPA policy to perform studies of this nature
                     independent of the OEM's, it would have seemed
                     appropriate to seek validation of the teardown costing from
                     the manufacturer whose vehicle is the basis for this
                     analysis.  For a review of other assumptions that are of
                     concern, see the response to the next Question.
                     One  of the major assumptions in this study that is flawed is
                     that the high voltage battery will be manufactured in the
                     United States. NiMH batteries are not manufactured in
                     volume in the United States, and although several
                     companies have plans to manufacture Li Ion batteries, the
                     cells typically come from Asia. To assume that all this
                     manufacturing  is done in the US will results in artificially
                     high  unit costs  for these systems. If this information is then
                     used by the EPA for downstream rule making, it will  have
                     the effect of having hybrid technologies show up in an
                     unfavorable light as compared to other technologies. This
                     inaccuracy could be remedied by a modification of the
                     assumptions in terms of where the battery will be
                     manufactured.
28      Ramaswamy   This  study does not present sufficient examples of
                     independently determined system/subsystem costs to be
                     used for validation of the costs that FEV/Munro calculates
                     through their process. Although the report mentions this
                     was done (section C.7), examples of such validation are
                     not presented.  These independently determined
                     costs/sources should be additional inputs to this process.
29         Bohn     Comments in the boxes above discuss some of the
                     bounded areas of assumptions that affect cost and/or
                     performance, such as engine/motor blending.
27      Ramaswamy
                                                        14

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/      Assumptions in         30         Bohn      A somewhat contentious point related to assumptions is
Results            Model                                      the component rating system for electric machines. There
                                                             is currently no published standard for electric machine
                                                             rating methods in automotive applications. Peak ratings
                                                             versus average versus steady state, as well as inlet
                                                             cooling rates and losses at different operating points are
                                                             tied up in the assumptions used to compare one electric
                                                             machine to another after the scaling algorithm.
Methodology/      Assumptions in         31         Bohn      The model is very comprehensive, and according to the
Results            Model                                      reviewer's teleconference, the authors of this study
                                                             validated many of the models and component scaling
                                                             models.
Methodology/      Assumptions in         32         Bohn      To the best of this reviewer's knowledge, the assumptions
Results            Model                                      used in this study are reasonable. Inputs on materials cost
                                                             for the study appear to be reasonable to this reviewer.
Methodology/      Assumptions in         33       Jacovides   These seem to me to be appropriate. A problem will arise
Results            Model                                      with the next person who runs the model. Will they have
                                                             the expertise of FEV, which I think is one of the premier
                                                             automotive engineering firms?
Methodology/      Assumptions in         34         Miller      While the majority of assumptions cited in the study are
Results            Model                                      valid, there are a number of assumptions that need to be
                                                             re-considered.  They are as follows:
                                                             • The technologies used are considered to be mature.  It is
                                                             more likely that the technology will continue to evolve
                                                             requiring changes to manufacturing facilities and tooling.
                                                             The assumption of maturity, for example, impacts a
                                                             number of underlying cost elements and other
                                                             assumptions: there are assumed  to be no allowances for
                                                             product/manufacturing  learning, scrap rates are minimal,
                                                             non-recovered E.D&T expense and capital costs are zero,
                                                             and there are no allowances for equipment end of life
                                                             costs. All of these stem from the assumption of maturity.
                                                             At the same time, however, it is assumed that no new or
                                                             modified equipment maintenance is required (See pages
                                                             16 & 17). This is not consistent with equipment at the end
                                                             of its life cycle. All of the above will cause cost estimates to
                                                             be understated.
                                                             • Recommendation:  Review the costs impacted by the
                                                             assumption of maturity. Uplift costs by a percentage factor
                                                             where appropriate.  If the assumption remains that
                                                             equipment will be at the end of its useful life, then increase
                                                             maintenance costs over time according to the equipment
                                                             OEM's guidelines.
Methodology/      Assumptions in         35         Miller      • It is assumed that "integration of new technology would
Results            Model                                      be planned and phased in to minimize non-recoverable
                                                             expenses". This would indeed be the most cost effective
                                                             decision.  However, given the significant requirements for
                                                             fuel economy improvements and  emissions reductions, the
                                                             need to implement new technology will likely be the over-
                                                             riding  consideration.
                                                             • Recommendation:  Perform cost sensitivity analyses with
                                                             non-recovered E.D&T and stranded capital in percent
                                                             increments ranging from 10 to 30 %. Include the results in
                                                             the paper.
                                                        15

-------
                       Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/      Assumptions in         36         Miller     • End-item scrap includes quality defects, rework costs,
Results            Model                                      and/or destructive test parts (page 29).  The general mark-
                                                             up varies from 0.3% to 0.7% depending on part complexity
                                                             and size (page40, Table C-1). However, it is stated that
                                                             exceptions are made depending on the part. Examples
                                                             cited in Section C.4.5.2 include sand and investment
                                                             casting. These are considered to be "generic" processes
                                                             and the end-item scrap mark-up is uplifted to 5% in both
                                                             cases. However, just as in Table C-1, this rate needs to
                                                             vary dependent upon the part size and part complexity (I
                                                             am assuming tolerance limits are considered part of part
                                                             complexity. If not, tolerances need to be considered as
                                                             another factor in determining scrap rates.)  Without a part
                                                             by part review of the assumptions, the impact to the cost
                                                             analysis can not be determined.
                                                             • Recommendation: To test the reasonableness  of the
                                                             scrap percentages, check a random sample of
                                                             components and compare the end-item scrap rates for
                                                             those processes to industry standards. Use complexity
                                                             and size of the parts to adjust averaged rates
Methodology/      Assumptions in         37         Miller     • All sourcing/manufacturing centers are assumed to be in
Results            Model                                      the United States. As discussed in the March 8,2011
                                                             conference call, this is not a valid assumption and can
                                                             significantly impact cost either negatively or positively.
                                                             • Recommendation: Review present sourcing patterns, at
                                                             least for the high cost components and sub-assemblies,
                                                             and utilize these patterns as the basis for the cost analysis.
Methodology/      Assumptions in         38         Miller     • Labor Rates MAQS Costing Worksheet Example (page
Results            Model                                      46).  It can not be determined whether or not any overtime
                                                             costs were assumed in the labor cost/hour calculation.
                                                             Overtime costs will vary manufacturer to manufacturer
                                                             based on Union agreements and/or operating practices.
                                                             However, in a number of cases (Ford Motor Company for
                                                             one), shifts of 10 hours per day in the United States would
                                                             generally include 2 hours of overtime pay. Afternoon shift
                                                             also has an associated premium cost.
                                                             • Recommendation: Verify underlying assumptions in the
                                                             labor rate models.
Methodology/      Assumptions in         39         Miller     • Packaging Assumptions: Based on the sample
Results            Model                                      calculation (page 50, Figure C-6), allowances for a
                                                             percentage of pallets/racks out for cleaning  and/or repair
                                                             (generally around 5%) have not  been included. This
                                                             understates the packaging cost.
                                                             • Recommendation: Increase the # of packaging units
                                                             required by 5% where returnable packaging is used.
                                                        16

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology
/Results
Assumptions in
Model
40
Miller
Methodology/
Results
Assumptions in
Model
41
Miller
Methodology/
Results
Assumptions in
Model
42      Ramaswamy
• Cost of Complexity Assumptions:  Based on the volume
assumption of 450K per year, although it is not stated in
the report, it is assumed that the major complex
assemblies: Engine and Transmission as well as Complex
Subsystems are produced on dedicated lines.  If not, then
a cost of complexity factor needs to be added. The 75%
combined utilization/efficiency assumption (calculated
based on page 37) is reasonable.  However, if hybrid
components are assembled on the same lines as the
baseline products, then this utilization/efficiency is over-
stated due to the inherent inefficiencies caused by
manufacturing complexity. Note: It should be assumed
that hybrid and base vehicles will be assembled on the
same line and so this added complexity must be factored
into the utilization/efficiency calculation.
• Recommendation: Process flow diagrams for complex
base-line vehicle assemblies/components should be
compared to those developed for HEV vehicle and
adjustments made to the efficiency/utilization percents for
HEV based on this comparison.
• System Scaling Cost Analysis: While the use of ratios to
develop sizing for HEV components such as traction
motors,  high traction batteries, etc. is appropriate and can
be used to estimate material costs, the use of these ratios
to determine other factors within manufacturing cost such
as labor (page 126) is less valid.  Part complexity
influences these costs more than part size.  The same
concerns exist with establishing component costs for P2
HEV powertrain components using manufacturing cost to
component size ratios (page 127).
Recommendations:
• Re-evaluate the assumptions around use of a scaling
factor to better define those costs which are scalable and
those which are not.
• Assuming the validity of the approach to costing using
manufacturing cost to component size ratios, provide
background data supporting this assumption.
• As outlined above, review the application of scaling
factors, especially for manufacturing cost and burden. The
methodology described in the paper yields a result that
should be considered as one end of a range estimate. The
other end of the estimate should be developed by applying
scaling factors to material cost and investment in
equipment and holding the other costs constant. If it is
necessary to state an absolute cost, the pick a middle
ground between these two numbers based on expert
opinion.
In general, the assumptions that are utilized to calculate
cost and performance are reasonable. One big exception
(also mentioned in question 6 below) is the scaling
parameter for the battery. Only two paragraphs are
devoted to it in the report, and nowhere is a definition of "a
common run-time", which is used in the scaling of the
battery, provided.
                                                        17

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/      Result                  43         Bohn      Yes. The results expected of the study are reasonable
Results            Appropriateness                              given the scope, assumptions and inputs.
Methodology/      Result                  44         Bohn      The net incremental cost for each of the vehicle sizes and
Results            Appropriateness                              two hybrid topologies seems intuitive on cost magnitude, if
                                                              in fact performance is equivalent.
Methodology/      Result                  45         Bohn      This reviewer cannot comment on other results that could
Results            Appropriateness                              be derived from the study.
Methodology/      Result                  46         Bohn      Validation is a very subjective process with regard to the
Results            Appropriateness                              level of validity'. After reading the study description, and
                                                              listening to the authors during the reviewer's
                                                              teleconference where the validation process was
                                                              described, it appears that reasonable validation was
                                                              achieved on the costing  results.
Methodology/      Result                  47      Jacovides    The results are reasonable, not only because the actual
Results            Appropriateness                              number is the same as we got in our study but because the
                                                              costs are estimated with great detail.  I am aware of one
                                                              other company that has  used this approach to come up
                                                              with detailed  costs of automotive components [Footnote 6:
                                                              Intellicosting  LLC, 980 Chicago Road, Troy, Ml 48083-
                                                              4226].  However I am not aware of any similar results for
                                                              hybrids.
Methodology/      Result                  48      Jacovides    I realize that you cannot publish confidential information
Results            Appropriateness                              that you obtain from OEM's, but I  think it would be useful to
                                                              show the results to Ford and Toyota before making the
                                                              report public.  They are much more likely to find errors than
                                                              the review panel and it may prevent any arguments after
                                                              the report is made public. I understand that this a policy
                                                              matter, but getting their input seems reasonable to me
Methodology/      Result                  49         Miller      At best, the levels of assumptions that are made in a study
Results            Appropriateness                              of this magnitude provide costs that are  directionally
                                                              correct. During the conference call on March 8, 2011, it
                                                              was stated that the study commissioned was for absolute
                                                              costs as opposed to range estimates. However, this gives
                                                              the study results more credence than the assumptions can
                                                              support. It was also stated, in the same conference call,
                                                              that a  manufacturer had been asked to provide costs for
                                                              one component and that the cost differential to that
                                                              developed in this study was 5%.  This further supports the
                                                              concern with  reporting the cost results of the analysis as
                                                              absolutes.
                                                        18

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/      Result                 50        Miller      • Concerns regarding validation have been stated
Results            Appropriateness                              consistently throughout this review. Teardown analysis,
                                                              development of process flow diagrams, analysis of
                                                              comparable parts where available, etc., are excellent
                                                              methodologies. However, a number of assumptions have
                                                              gone into the methodology used to develop the
                                                              manufacturing costs from these process flow diagrams and
                                                              the validation of these assumptions are not documented in
                                                              this paper. Of particular concern are the assumptions
                                                              around sourcing (directed by the EPA), product maturity,
                                                              development of burden rates by piece of equipment, direct
                                                              labor cost calculations and the application of component
                                                              size ratios as the primary scaling factor for manufacturing
                                                              cost in other vehicle applications.
                                                              Recommendations:
                                                              • For those components/ assemblies which most impact
                                                              vehicle cost, provide range estimates. Without looking at
                                                              more detail, a proposal for these ranges can not be made.
                                                              However, the cost developers for this study should be able
                                                              to provide such ranges as are appropriate based on
                                                              sensitivity testing.
                                                              • Where components are most likely to be sourced outside
                                                              the United States, costs need to be adjusted for  sourcing
                                                              pattern. The sourcing pattern may be a cost reduction or
                                                              cost increase dependent upon a number of factors.
                                                              • In the direct labor calculation of the mean manufacturing
                                                              labor wage for a component or assembly (page 32), it is
                                                              unclear whether or not the various labor wage rates are
                                                              weighted by the calculated number of employees in that
                                                              classification to obtain a weighted average.  If this has not
                                                              been done, direct labor costs need to be re-evaluated.
                                                              There are significant wage differentials between  the
                                                              various classifications with general assembler being the
                                                              lowest paid. (The same applies to the indirect labor costs.)
Methodology/      Result                 51      Ramaswamy   The results of the study are appropriate for the given
Results            Appropriateness                              scope, assumptions and inputs.
Methodology/      Result                 52      Ramaswamy   The description/report of the validation of the costing
Results            Appropriateness                              methodolgy is not sufficient. The report does say that
                                                              experts have been consulted in determining the costs of
                                                              various components, but little validation has been shown
                                                              (in the report) of cost validation at a subsystem or system
                                                              level. The overall costs developed by FEV would present a
                                                              greater punch if there were examples of the comparison of
                                                              their system/subsystem costs with other costs that have
                                                              been published in literature.
Methodology/      Result                 53      Ramaswamy   FEV and Munro have the  tools necessary to do a
Results            Appropriateness                              sensitivity analyses of the costs with respect to different
                                                              variables of interest. Further analyses could include
                                                              refinement/correction of some of the assumptions around
                                                              this study (as mentioned in this review) and studying how
                                                              the overall system costs are impacted by those changes.
                                                        19

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/      Approach used in        54         Bohn      The approach used in scaling cost of the powersplit
Results            Scaling                                      technology to other vehicle classes appears reasonable
                                                              and shows no reason that it may be not accurate.  The
                                                              actual numbers placed into the scaling routines may be off,
                                                              and result in turn may be off, but the approach is
                                                              reasonable.
Methodology/      Approach used in        55         Bohn      The methodology for using power-split component costs in
Results            Scaling                                      other hybrid technologies is reasonably and appropriate
                                                              since several components are common, but scaled. As
                                                              mentioned above, there are currently no published electric
                                                              machine rating standards for automotive applications. The
                                                              electric machine in the P2 topology has (or likely may
                                                              have) a different load profile than that used for the power-
                                                              split topology where engine power is split through the two
                                                              electric machines instead of just one in the P2.  To that
                                                              point using the normalized cost of the electric machines
                                                              ($/peak watt) from the power-split in the P2 topology is
                                                              reasonable, but the machine rating/sizing may not directly
                                                              translate. The battery costs will be equivalent between the
                                                              two on peak power/energy, scaled as  described in the
                                                              report.
Methodology/      Approach used in        56      Jacovides    Scaling for a vehicle with identical architecture but with
Results            Scaling                                      higher power is not as simple as it appears. Results are
                                                              given on page 132 (pdfj [Footnote 7: Page numbers refer
                                                              to the pdfnot the pages in the report]  for the HVAC
                                                              system where the fixed cost of the electronics is, correctly,
                                                              taken out.  However the compressor cost appears to be
                                                              scaled as the power. This is not correct since the material
                                                              may indeed be scaled as the power but the labor is not.
Methodology/      Approach used in        57      Jacovides    Similarly the cost of the electrical machines should not be
Results            Scaling                                      scaled as power. As stated above scaling for the P2 should
                                                              be made on the basis of torque and duty cycle. I
                                                              understand that two designs were made for a 30kW
                                                              generator and for a 60kW motor. It was said during the
                                                              conference call that using these designs the data were
                                                              extrapolated for different size vehicle.  This can only be
                                                              done if the motor and generator have  identical torque and
                                                              duty cycle profiles. This is highly unlikely and so someone
                                                              with electrical machine design experience needs to
                                                              develop parametric results for the motor and generator
                                                              separately. Also as stated above one cannot use power
                                                              for scaling a slow speed machine used for the P2
                                                        20

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/      Approach used in       58       Jacovides   The NiMH battery scaling is done correctly. A possible
Results            Scaling                                     weakness is that as an alternative to reducing the number
                                                             of cells to estimate a smaller system, one may choose to
                                                             use a larger number of smaller cells.  Regarding the
                                                             electrical machines and the compressor I suggest that a
                                                             separate small study be undertaken to determine the
                                                             scaling factor.  I suspect it will be between two extremes,
                                                             .a) scale as power and b) scale material as power and
                                                             leave labor and overhead the same. Things get even more
                                                             complex if a different architecture is used.  The approach
                                                             used here for the P2 architecture is directionally correct but
                                                             the results will not have the accuracy that the Ford Fusion
                                                             comparison has with its ICE counterpart.
Methodology/      Approach used in       59       Jacovides   The treatment of the Li-ion battery (LIB) raises a number of
Results            Scaling                                     questions
                                                             1 .What is the available energy? Typically the SOC
                                                             variation is limited in order to obtain life. For hybrids like
                                                             the Prius the swing is from about 50% to 60%.  The GM
                                                             Volt battery swing is 30 to 80%. Scaling the LIB to the
                                                             same nominal kWh assumes that the life of the LIB will be
                                                             comparable. Some discussion is needed that the life will
                                                             not be compromised
                                                             2.It is not clear what size battery is costed for the P2.
                                                             Page 126 (pdf) states that the battery from the Avante is
                                                             0.954 kWh and this battery was costed on table  D13 at
                                                             $1399. Increasing the energy by 270/180 and scaling the
                                                             costs as energy the P2 battery should cost $2098. Please
                                                             explain whether the cost of the P2 battery is $1399, $1798
                                                             or $2098.  To add to my confusion table F2 shows a
                                                             battery of 0.9117 kWh for the mid large (Fusion size
                                                             vehicle). Also table A4 shows $1690.43 for the High
                                                             Voltage Traction  Battery Subsystem. I am sure I am
                                                             missing something but it needs to be clarified for the
                                                             reader
                                                             S.The estimated cost of the cells given in D-13 for a 0.954
                                                             kWh battery of $1020 seems reasonable at roughly 1000
                                                             $/kWh
Methodology/      Approach used in       60         Miller     The use of ratios to develop sizing for HEV components
Results            Scaling                                     such as traction motors, high traction batteries, etc.  as
                                                             described in the paper is appropriate and can be used
                                                             effectively to estimate material costs and investment in
                                                             equipment.
                                                        21

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/
Results
Approach used in
Scaling
61
   Miller
Methodology/
Results
Approach used in
Scaling
62
   Miller
Methodology/
Results

Methodology/
Results
Approach used in
Scaling

Approach used in
Scaling
63
64
Ramaswamy
Ramaswamy
Methodology/
Results
Approach used in
Scaling
65      Ramaswamy
• Concerns with using the size ratio scaling methodology
for certain other cost estimates is documented in other
sections of the response.  For convenience, they are
repeated here:-Certain elements of overhead cost such as
salaries and front office costs are not impacted, or at most
minimally, by part size. -Direct labor costs are more closely
tied to part complexity than to part size. -While part size
will impact certain areas of indirect labor, such as material
handlers, it will have a lesser impact on number of
supervisors, quality inspectors, etc.  Like direct labor, these
numbers  are more closely tied topart complexity than size.-
The same concerns exist with establishing component
costs for the P2 HEV powertrain  components using
manufacturing cost to component size ratios (page 127).
• The issues addressed above regarding scaling
methodology apply equally to the P2 manufacturing cost
calculations.
Recommendations:
• Re-evaluate the assumptions around use of a scaling
factor to better define those costs which are scalable and
those which are not.
• Assuming the validity of the approach to costing using
manufacturing cost to component size ratios, provide
background data supporting this  assumption.
• As outlined above, review the application of scaling
factors, especially for manufacturing cost and burden. The
methodology described in the paper yields a result that
should be considered as one end of a range estimate. The
other end of the estimate should  be  developed by applying
scaling factors to material cost and investment in
equipment and holding the other costs constant. If it is
necessary to state an absolute cost, the pick a middle
ground between these two  numbers based on expert
opinion.
For most of the components, the approach used in scaling
the cost of power split technology to other vehicle classes
is reasonable and likely to yield reasonable results.
The one potential exception (and it is stated as  potential,
because the approach is not well explained  in the report)  is
the scaling of the high voltage battery parameters across
the the different vehicle classes.  This needs to be better
explained and justified, particularly because this one
component is responsible for the bulk of the cost of the
hybrid powertrain.
Given that the overall cost of the  hybrid powertrain is so
sensitive  to this one component,  this reviewer feels that
greater care is needed in developing this cost. Conversely,
there is considerable detail in the report on the costs for
much more minor components, and  although that is not a
bad thing, the appropriate scaling of the battery system
needs to  have more effort put into it.
                                                         22

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Methodology/
Results
Approach used in
Scaling
Methodology/
Results
Methodology/
Results
Approach used in
Scaling
Approach used in
Scaling
Editorial Content   Sufficient
                  Detail/Appropriate
                  Appendices
Editorial Content   Sufficient
                  Detail/Appropriate
                  Appendices
Editorial Content   Sufficient
                  Detail/Appropriate
                  Appendices
66      Ramaswamy   Although the scaling for the most of the components
                     across the different vehicle classes seems reasonable, one
                     big item that is not explained clearly is the high voltage
                     battery. Given that it is the single most expensive
                     subsystem within the hybrid powertrain, more care needs
                     to be put into ensuring that this is done in a reasonable
                     manner, and the report needs to explain how this was
                     done. The last paragraph on page 132 talks about the
                     "common run-time" parameter that is used to scale the
                     battery system across vehicle segments. This parameter
                     needs to be defined, and the report should have more of
                     an explanation why the value of 0.0168 hours was used,
                     and how it translates to the other parameters (power
                     rating, energy rating) that define a battery
67      Ramaswamy   In Table E-2, the nominal pack voltage for the subcompact
                     passenger vehicle is quite low, namely 148V. Could other,
                     potentially cheaper power electronics technologies be used
                     at this battery voltage?
68      Ramaswamy   There is a small discrepancy between some of the
                     numbers in Table E-2 as compared to those in Table D-3.
                     For example, for the Fusion Hybrid, Table D-3 lists the net
                     power as 142kW, whereas Table E-2 lists it as 140.6kW.
                     Similarly, the engine power is listed as 116kW in Table D-
                     3, but as 114.8kW in Table E-2. Even a rounding of the
                     numbers doesn't make them the same.
69         Bohn      The report is sufficiently detailed for a reader familiar with
                     the subject report to understand the process and
                     conclusions. Each  of the sections provides a very detailed,
                     pedagogical approach on the rationale of systems and
                     subsystem functions, components and assessed costs.

70         Bohn      The tables inserted in the report are, of necessity, very
                     small font with many values in a small area making it
                     somewhat difficult to read in 8.5" x 11" printed format. The
                     electronic format was easier to read and understand,
                     zooming in on one column at a time.   No change is needed
                     for this in the report format, but possibly extracted column
                     highlighting significant results would add clarity. A great
                     deal of effort was expended to produce this space efficient
                     report in a readable number of pages (sufficient detail
                     without being too long.)
71         Bohn      The appendices are appropriate. The cost model template
                     is sufficient for the appendix.
Editorial Content   Sufficient
                  Detail/Appropriate
                  Appendices
                       72       Jacovides    I would like to see a clear definition of what is assumed to
                                            be the Indirect cost (1C). Is everything not included in Step
                                            7 MAQS on page 21  assumed to be covered by 1C? I
                                            realize that assigning an 1C factor is beyond the scope of
                                            this report but it should be made clear what is included.
                                            Also it should be made clear that no allowance was made
                                            for a different 1C factor for parts sold by suppliers and
                                            made by the OEM's.
                                                        23

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Editorial Content   Sufficient               73       Jacovides
                  Detail/Appropriate
                  Appendices
Editorial Content   Sufficient               74       Jacovides
                  Detail/Appropriate
                  Appendices
Editorial Content   Sufficient               75       Jacovides
                  Detail/Appropriate
                  Appendices
                     A minor editorial point deals with Page 10 figure A1. I
                     would clarify the planetary gear set by showing ring,
                     planets and sun clearly. Also remove the gap between the
                     differential to show that the two gears mesh. Further label
                     the output of the differential as going to vehicle wheels not
                     coming from the wheels
                     Page 9 makes a good point up front  ...based on current
                     automotive and/or surrogate  industry manufacturing
                     operations and processes, it  is acknowledged that a
                     reduction to the costs presented is very likely based on
                     both product and manufacturing learning. Projected
                     technology cost reductions, as a result of learning, are not
                     covered as part of this analysis.
                     Page 21 .Item #8, Market Place Crosscheck, is a good idea
                     but needs further explanation and the report should show
                     results. Comparison with FEV in house experts seems
                     less than satisfactory.
Editorial Content   Sufficient
                  Detail/Appropriate
                  Appendices
76       Jacovides    Page 37 uses labor rates from BLS.  Since lithium ion
                      batteries are not made in the US it would be good to say
                      what labor rate was used for the Li-ion battery. Some of
                      the operations need to be made in low grade clean room
Editorial Content   Sufficient
                  Detail/Appropriate
                  Appendices
Editorial Content   Sufficient
                  Detail/Appropriate
                  Appendices
Editorial Content   Sufficient
                  Detail/Appropriate
                  Appendices
77       Jacovides    I would be interested to find out how the electrical
                      machines are cooled for the split power.  Oil cooling is
                      used for the P2 and coolant fluid is used for the power
                      electronics but I doubt that coolant was used for direct
                      cooling of the motor and generators

78         Miller      Although a substantial amount of detail is included, there
                      are a number of things that should be added to the report
                      to substantiate the process and conclusions. As outlined
                      in a number of questions above, these details are
                      necessary to validate the processes  and  underlying
                      assumptions used to arrive at the cost conclusions.  These
                      details include:-Validation of the Munro & Associates
                      software including methodology and  results
                      •Validation and sensitivity testing (or results of the testing)
                      of the FEV cost algorithms
                      •A worked example showing the detail behind each
                      number in the MAQS costing sheet.
                      •Sensitivity analysis for a sampling of the components and
                      assemblies in the cost analysis.
                      •Data supporting the assumption that manufacturing costs
                      can be calculated as a ratio of component size.
                      •Clarification of the calculations for direct labor cost.
79         Miller      With the exception of the last item  [Clarification of the
                      calculations for direct labor cost], all of the appropriate
                      documentation should be provided as appendices or as
                      links to other papers/detailed analytical data.
                                                         24

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Editorial Content
Sufficient
Detail/Appropriate
Appendices
Editorial Content   Editorial Issues
Editorial Content   Editorial Issues

Editorial Content   Editorial Issues
Editorial Content   Editorial Issues
Editorial Content   Editorial Issues
80      Ramaswamy   In most cases, sufficient detail has been provided for a
                     reader familiar with the subject report to understand the
                     process and conclusions.  Exceptions are:
                     • Rationale for assuming the high voltage battery is
                     manufactured in the United States-Development of the
                     ED&T costs for different subsystems, particularly that for
                     control systems-Validation of the calculated costs at a
                     subsystem/system level
                     • Scaling of the battery system across different vehicle
                     classes Cost for the high voltage DC/DC converter doesn't
                     appear to be included
81         Bohn      There is a divergence in the electrical engineering world on
                     the proper use of the term for electrical  distribution
                     'omnibus'.  The classic spelling of the word has only one's'
                     as in 'bus'.  The other spelling is also accepted as 'buss'.
                     There is no direct reference to point of divergence since
                     the word 'electrical bus' was first used.  No action required,
                     just pointing out that there are two accepted spellings, the
                     first coming from the origin of the word 'omnibus'.  The link
                     below shows a survey of the percentage of respondents on
                     their preference/where they were educated:
                     http://www.gearslutz.com/board/so-much-gear-so-little-
                     time/15867-buss-bus-where-you-learned-3.html
82         Bohn      Pagination  and grammar in general are very consistent
                     and acceptable.
83       Jacovides   No comments- everything seems very well done
84         Miller      The general organization of the paper is clear.
85         Miller      The following are areas where typographical errors or
                     other editorial issues exist:-Page 16—Item 2 net to the last
                     line. "Develop" should read Development" 'Page 35—next
                     to the last paragraph references a template in Appendix
                     E.4. This Appendix could not be found in my copy of the
                     paper. This may just be a labeling error, but none of the
                     pages in  the appendix appeared to be the template
                     referenced.'Page 42—Next to the last paragraph, 2cnd
                     sentence. FOB (freight on board) is usually designated as
                     FOB, destination—supplier pays the shipping costs or FOB
                     Factory—customer takes control of the  product and pays
                     the shipping cost. Note that in Europe,  FOB is always
                     referred to as "Free on Board".  Assuming you mean the
                     receiving company pays the freight, the more common
                     term would be FOB Factory.
                                                         25

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Editorial Content   Editorial Issues
Editorial Content   Editorial Issues
Additional
Comments
Next Steps
86      Ramaswamy   In most cases, sufficient detail has been provided for a
                     reader familiar with the subject report to understand the
                     process and conclusions.
                     Exceptions are:
                     • Rationale for assuming the high voltage battery is
                     manufactured in the United States-Development of the
                     ED&T costs for different subsystems, particularly that for
                     control systems
                     • Validation of the calculated costs at a subsystem/system
                     level
                     • Scaling of the battery system across different vehicle
                     classes
                     • Cost for the high voltage DC/DC converter doesn't
                     appear to be included
87      Ramaswamy   The overall report is well organized. There are a few minor
                     typographical/grammatical  issues. These are included in
                     detail in section Grammatical/Typographical Errors
                     IPage 10, 2nd line, replace "advance" with "advanced"
                     2.Page 11, 3rd line, replace "value" with "valve"
                     S.Page 18, 3rd line, replace "standardize" with
                     "standardized"
                     4.Page 18, paragraph 2,1st line, replace "very" with "vary"
                     S.Page 19, paragraphs, 5th line from bottom,  replace
                     "develop" with "developed"
                     S.Page 21, extra  bullet point in Scenario #2
                     /.Page 52, last paragraph, replace "Too" with "To"
                     S.Page 52, last paragraph, replace "truck" with "trunk"
                     9.Page 56, 2nd paragraph, replace "approximate" with
                     "approximately"
                     10.Page 91,  3rd paragraph, replace "acknowledge" with
                     "acknowledged"
                     11 .Page 97,1st paragraph, replace "VEV" with "HEV"
88       Jacovides   Here are some unsolicited improvements and possible
                     next steps:
                     As discussed above under f) have small study made on
                     how to scale electrical machines and the compressor to
                     distinguish between scalable and fixed costs.
Additional
Comments
Next Steps
89       Jacovides   It would be good to check with Ford as to the accuracy of
                     the results. Although their volume is not up to 450k they
                     should be able to give you an estimate. For comparing the
                     P2 costs check with Honda or GM, which produce similar
                     architectures although, without a clutch between the
                     engine and transmission. More problematic will be a check
                     with the GM on their two mode hybrids. They have higher
                     power and one additional gear, but they seem to be much
                     more expensive. As I said earlier the numbers check with
                     the Prius that we studied, but we were puzzled by the GM
                     figures. Although the Fusion is bigger the Prius data are a
                     couple of years old and Toyota had not reached the 450k
                     volume.
                                                        26

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Additional
Comments
Additional
Comments
Next Steps
General
Observations
Additional
Comments
General
Observations
Additional
Comments
General
Observations
Additional
Comments
Additional
Comments
General
Observations
General
Observations
90       Jacovides    I would use the scaling exercise for the Volt and the Leaf.
                     These are much different vehicles but have components
                     that have been included in this study.  Then check with GM
                     and Nissan on costs.
91       Jacovides    Accurate calculation of the cost of new technology is very
                     important to EPA since it needs to relate it to fuel
                     consumption reductions. The recent history of these efforts
                     is summarized in three reports [Footnote 1,2,3:1: EPA420-
                     R-08-008 March 2008; 2: EPA-420-R-10-010 April 2010; 3:
                     EPA-420-R-09-020 December 2009].  Until recently the
                     approach was to ask OEMs and suppliers the cost of
                     technologies and by taking several samples and probing to
                     create reasonable  estimates of the cost to  manufacture.
                     This approach was taken in reference 1 and also by an
                     NRC Committee to study an "Assessment of Technologies
                     for Improving Light-Duty Vehicle Fuel Economy" [Footnote
                     4:http://www8.nationalacademies.org/cp/CommitteeView.a
                     spx?key=48843].
92       Jacovides    I was a member of this committee and during our
                     discussions we thought that a better approach would be to
                     take apart the components of a new technology and
                     analyze how much each component would cost. Such an
                     approach would include no only the cost of labor and
                     materials but all other "manufacturing" costs. Reference 2
                     and 3 are examples of such an approach and deal with
                     vehicles with conventional power trains and, in  my view,
                     confirm the accuracy of the process.
93       Jacovides    The present report deals with hybrids and my evaluation
                     will deal with the report as it calculates manufacturing
                     costs. Of course in evaluating new technology  EPA is
                     charged to estimate not the manufacturing cost but the
                     cost to the consumer to determine the cost to the
                     consumer. Traditionally this was done using the so called
                     Retail Price Equivalent (RPE) factor.  The present report
                     uses a factor called Indirect Cost (1C) multiplier.
                     Establishing the multiplier is a highly controversial process
                     and an  EPA's attempt is given in [Footnote 5: EPA-420-R-
                     09-003 February 2009].  The controversy as discussed in
                     reference 4 is that  EPA tends to come up with a small
                     factor and OEM's with a  larger one. Also OEMs insist that
                     a different factor should be used for technologies bought
                     from suppliers and technologies manufacturer in house.
                     Since the present report does not address  this issue, I will
                     limit my remarks to the estimation of the "manufacturing"
                     costs as described. However since the EPA will use this
                     factor in its regulatory process, the end result will likely
                     underestimate the  final cost to the consumer
94         Miller      It is clear that a great deal of detail and effort has gone into
                     FEV's analysis and preparation of the report.
95         Miller      The use of vehicle/component teardowns is an  integral part
                     of the analysis and recognized by the industry as an
                     excellent means of cost analysis.   Likewise, the
                     development of detailed process flow charts used in the
                     detailed costing is a well accepted practice.
                                                        27

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Additional
Comments
General
Observations
96
   Miller
Additional
Comments
General
Observations
97
   Miller
Additional
Comments
General
Observations
98
   Miller
Additional
Comments
General
Observations
99
Ramaswamy
Additional
Comments
General
Observations
100     Ramaswamy
Additional
Comments
Battery
Manufacturing
101     Ramaswamy
The report analysis relies heavily on a number of data
bases and models that are necessarily quite complex.
However, validity testing of the Munro & Associates
software which is fundamental to the development of the
cost estimates is not documented. Additionally, tests that
have been performed to validate the FEV data bases and
the costing algorithms are not included.
Recommendation: Since these data bases are integral to
the study, include the detailed methodology, including
worked examples, used to validate these data bases.
Hypothesis testing of assumptions concerning burden
rates, product maturity, etc. and sensitivity analysis to
demonstrate correlation to actual component costs should
be a part of the study.  It is recognized that providing all the
supporting detail in a paper of this magnitude would be
excessive. However, a link to the data could be included
similar to the one for OTAQ documents (page 126). If the
data is considered proprietary, then examples tracing both
a simple and a complex component/assembly through the
process demonstrating how the various costs were derived
should be included in an Appendix or as a separate
document.
The process for defining and apportioning manufacturing
burden costs such as front office salaries down to a single
machine on the plant floor is questionable.
Recommendation: It would be more acceptable to apply
the developed burden rates at a manufacturing
process/component level.
Table A-1 has a calculation of the percent
decrease/increase in cost of adding the power split system
to different vehicle segments. It would be more appropriate
to calculate the percentage increase as compared to the
base non-hybrid vehicle cost,  instead of calculating the
increase with respect to the mid/large size vehicle
segement cost.
Nowhere in the paper (for example, section D.7.1 makes
no mention of it, and neither do Tables D-5 or D-6) could
this reviewer find the mention of the high voltage DC/DC
converter (which converts the voltage from approx 300V to
approx 600V, and subsequently utilized by the traction
motor and generator), which is used in the Fusion  Hybrid.
The corresponding cost for this part is also not mentioned.
The report assumes  that the battery will be manufactured
in locations in North America. Although this reviewer
understands this to be a constraint from the EPA, this is
not a reasonable assumption. There is no large scale
automotive NiMH manufacturing in North America currently
and there are few plans for the same.  Although there are
more examples of Li  Ion battery manufacturing in North
America, it is questionable if Li Ion will be the battery of
choice for hybrid vehicles. In this reviewer's
experience/knowledge, the NiMH battery will continue to
dominate the HEV market, while Li Ion will dominate the
PHEV/EV market.
                                                        28

-------
                        Verbatim Peer Reviewer Comments in Response to Charge Questions
Additional
Comments
Power Split
Systems
102     Ramaswamy
Additional
Comments
P2 Hybrid Systems     103      Ramaswamy
Additional
Comments

Additional
Comments

Additional
Comments
Cost Analysis
Observations

Cost Analysis
Observations

Cost Analysis
Observations
104
105
106
Ramaswamy



Ramaswamy



Ramaswamy
The report talks about the applicability of the power split
hybrid system to the sub-compact, small, large and
minivan vehicle segments. It should be clarified that this
group covers small SUVs, such as the Ford Hybrid
Escape, which is one platform that clearly already supports
this hybrid platform.
P2 Hybrid System
1. Although the EPA provided the direction to reduce the
maximum system torque/power by 18-19%, the rationale
for this isn't clear. Without this rationale, a meaningful
comparison between the cost figures for the power split
system and those for the P2 system cannot be made
2. Why was it felt that the Li Ion battery would be more
appropriate for the P2 hybrid? Li Ion batteries have much
better energy density than NiMH batteries, so for
applications that require large battery energy (such as
PHEVs or EVs), it is understandable to use Li Ion packs.
However, for the P2 application, the required kWH of the
battery (from Table F-2) was less than that for the power
split application (from Table E-2). Given this, the selection
of the Li Ion technology for the P2 system is not well
justified.
In Figure B-1, why isn't the BOM updated after step 6,
when additional information has been gained about the
component after its disassembly?
Page 50, first paragraph refers to 19,149 parts, and it
wasn't clear what the 19,149 parts stand for? Are these
19,149 battery packs?
It isn't too clear how the engineering design costs for
various components/systems have been calculated.
a. For example, in  section D.2.2, how has the engineering
design cost for the Atkinson engine and the control system
for it, and the calibration for it been calculated/estimated?
b.Similarly,  how is the engineering design cost for the
electronics controllers,  for the software for the battery
system, for the mechanical design of the battery system
been estimated? The actual numbers that have been
presented in the tables appear to be too low.
c.ln Table D-11, why is the ED&T for the traction  battery
assembly so high ($49) compared to that for the control
module (listed as $4)? The relative engineering effort for
the control module is not 12 times less than that for the
design of the mechanical assembly
                                                        29

-------
                       Verbatim Peer Reviewer Comments in Response to Charge Questions
Additional         Cost Analysis          107     Ramaswamy   In general, FEV and Munro are to be commended for the
Comments        Observations                               detail that they have shown in this approach to determining
                                                            hybrid system cost. The use of linked MAQS worksheets
                                                            that allow the component costs to be rolled up to
                                                            subsystem and system costs is a powerful tool, that can be
                                                            used to do sensitivity analysis further down the line.
                                                            However, the best system is only as good as the
                                                            inputs/assumptions that drive it. Some of the assumptions
                                                            used in this report(e.g. battery technology and size,
                                                            manufacturing location, system power)that are key in
                                                            determining overall system cost  have to be carefully
                                                            thought through and considered during future rulemaking
                                                            by the EPA.
                                                       30

-------
        Charge to the Peer Reviewers of EPA's Parallel Hybrid Technology Cost Report

EPA's Parallel Hybrid Technology Cost Analysis Report is another key milestone in an extensive
effort being carried out by FEV, under contract with EPA, to estimate the costs of technologies
likely to be used in meeting future light-duty highway vehicle greenhouse gas (GHG) emissions
standards. The report details the methodologies used by FEV and its subcontractor(s) to
determine the incremental manufacturing cost of one particular LD emission control technology
- a power-split parallel hybrid drivetrain, such as found in the Toyota Prius and Ford Fusion
Hybrid. In addition to detailing the cost results of power-split technology, this report details the
scaling of this technology to other vehicle classes, and establishes how the cost of major power-
split components can be used to inform the cost model for other types of vehicle technologies,
such as P2 hybrids.

No independent data analysis will be required for this review. Instead, EPA is seeking the
reviewer's expert opinion on the methodologies and cost results of this study, and whether they
are likely to yield an accurate assessment of the true cost of the technology. We ask that each
reviewer comment on all aspects of the report.  Please organize all responses according to the
charge questions for each of the two categories listed below.

    1.  Methodology/Results:

          a.   Is the methodology documented in the report generally reasonable and likely to
              yield accurate results?  Is any bias likely  to be introduced to the results due to
              methodological issues? If so, please indicate the direction of this bias and
              potential remedies.

          b.   Please identify any general flaws inherent in the scope of the study. Do you feel
              the results would be altered if the scope were more limited or expanded? Please
              explain.

          c.   Are all appropriate inputs for the study being considered? Conversely, are all
              inputs considered in the study appropriate? Please cite any particular inputs or
              assumptions made by the study  that you feel are inappropriate or likely to bias the
              results and how they could be remedied, with particular emphasis  on sources of
              information used in determining labor rates, material prices, manufacturing
              burdens and other key  factors.

          d.   Are the assumptions embedded in the model that affect projected cost or
              performance reasonable? Such assumptions might include learning curve,
              economies of scale, scaling parameters such as weight and power, labor rates,
              plant scaling, and material costs.

          e.   Are the results expected of the study appropriate for the given scope, assumptions,
              and inputs? Are there other results that could be derived from the analysis that
                                           A-1

-------
                              Appendix A: Charge to Peer Reviewers
              would support or contradict those cited by the study? Is appropriate validation
              made on the costing methodology and results? Please expand on any
              recommendations that you would make for analyses of study results.

          f.   Is the approach used in scaling the cost of power-split technology to other vehicle
              classes appropriate and likely to yield accurate results?, Is the methodology for
              using the cost of power-split components in other hybrid technologies appropriate
              and likely to yield accurate results?

   2.  Editorial content:

          a.   Is sufficient detail provided in the body for a reader familiar with the subject
              report to understand the process and conclusions? Are appropriate appendices
              included? Please specify any specific content that you recommended be added or
              removed.

          b.   Please comment on any editorial issues that should be addressed in the report,
              including any comments on general organization, pagination, or grammar and
              wording.

In preparing comments,  please distinguish between recommendations for clearly defined
improvements that can be readily made, based on data or literature reasonably available to EPA,
and improvements that are more exploratory or dependent, which would be based on information
not readily available to EPA. Comments should be clear and detailed enough to EPA readers or
other parties familiar with the report to allow a thorough understanding of the comment's
relevance to material provided  for review.

Additionally, EPA requests that the reviewers not release the peer review materials or their
comments until the Agency makes its report/cost model and  supporting documentation public.
EPA will notify the reviewers when this occurs.

If the reviewer has questions about what is required in order to complete this review or needs additional
background material, please contact Susan Elaine at ICF International (SBlaine@icfLcom or 703-225-
2471). If the reviewer has any questions about the EPA peer review process itself, please contact Ms.
Ruth Schenk in EPA's Quality Office, National Vehicle and Fuel Emissions Laboratory
                   or 734-214-4017).
                                            A-2

-------
Appendix B. Peer Reviewer CVs/Resumes
                         B-1

-------
Appendix B. Peer Reviewer CVs/Resumes
                B-2

-------
                                    Theodore P. Bohn
Educational Background

       M.S. 2003     Electrical Engineering, University of Wisconsin-Madison Electric Machine Design,
                     Power Electronics and Controls

       B.S. 1994     Electrical Engineering, University of Wisconsin-Madison Power Electronics, Electric
                     Machines and Control Systems

       A.S. 1982     Electrical Engineering Technology, Herzing College

Professional Experience

1999-Present     Electrical Engineer
                  Argonne National Laboratory, Lemont, IL
                  Mr. Bohn is a principal investigator in the Vehicle Systems Section of Argonne National
                  Laboratory's Center for Transportation Research. His team is responsible for advanced
                  vehicle testing and evaluation, modeling and systems analysis, and hardware-in-the-loop
                  (HIL) development of hybrid vehicle technologies. He has been designated the de facto
                  electric machines and power electronics expert, in a vehicle systems context, for the DOE
                  National Laboratory system. His current assignments include positioning Argonne as the lead
                  national laboratory in plug-in hybrid vehicle research within DOE.

                  The following lists of achievements and responsibilities are derived from current and past
                  projects within the CTR Annual Operating Plan tasks, as well as from the current position
                  description.

       Achievements:
                  Technology Crosscut: Supported by funds from several DOE sponsors, this effort bridges
                  research on component-level plug-in hybrid vehicle (PHEV) power electronics/motors at Oak
                  Ridge National Laboratory (ORNL), through Advanced Power Electric Machines Projects
                  (APEEM); thermal studies at the National Renewable Energy Laboratory (NREL); and the
                  Energy Storage Tech Team  (ESTT), with the FreedomCAR Vehicle Systems (VSATT) work
                  performed at Argonne.
                  •   Interacted with the  FreedomCAR APEEM tech team, as well as ORNL, to develop
                     methods for benchmarking high-speed, automotive-grade electric machines and power
                     electronics for PHEVs.
                  •   Constructed, on the basis of a previous proof-of-concept scaled design, a fully capable
                     55-kW fractional slot, segmented stator, surface permanent magnet prototype motor with
                     an Argonne-motor fabricator-university team. This motor met FreedomCAR targets for
                     cost, mass, operating temperature, and performance (being validated at present)  goals.
                     Three prototype motors were constructed to  study effects on losses for different stator
                     winding techniques. One of these motors was integrated into a production Lexus RX400h
                     rear motor gearbox and  is scheduled to be integrated into an Argonne PHEV prototype
                     vehicle for evaluation.
                  •   Provided technology transfer and information dissemination of state-of-the-art in power
                     electronics and electric machines to FreedomCAR tech teams and  OEM partners, as well
                     as component vendors.

-------
Theodore Bohn - January 2008
                      Procured sample OEM electric machines and transaxles from all of the current production
                      hybrid vehicles e.g.., Prius, Lexus, Accord, Civic, Escape, etc). Each of these machines
                      has been modified to connect to a conventional bench dynamometer to catalog key
                      electrical and mechanical parameters commonly used by motor designers. Loss
                      components, such as mechanical/gear loss, windage, and magnetic hysteresis losses, are
                      also part of the catalog of measured motor metrics.
                      Generated open-source electric machine motor-drive control software as part of
                      benchmarking the OEM machines described above. These software and benchmarking
                      methods are used to support the SAE Task Force on electric machine rating methods for
                      hybrid vehicle motors.

                  PHEV Technology Platform Development:
                  •   Created a low-cost, real-time, robust, data collection system for PHEVs based on
                      physical sensors, Global Positioning System (GPS) tracking, and interrogating vehicle
                      CAN bus data; uploaded system to a server via WiFi link (ARDAQ).
                  •   Exploited the surplus computing power of the processor used in ARDAQ to run a Real-
                      time In-Vehicle Emulation Toolkit (RIVETS) vehicle model to emulate a PHEV while
                      driving a conventional vehicle, by using in-vehicle sensors as model inputs.
                  •   Designed, procured, and constructed several custom battery packs based on state-of-the-
                      art battery technologies, such as A123 Systems lithium-nanophosphate chemistry.
                      Initiated a research effort  to develop PHEV energy storage systems with in-house-derived
                      battery state-of-charge tracking algorithms, which are usually proprietary and not
                      adjustable/tunable by the  user, as required for PHEV experiments.
                      Created a TTR (through the road) parallel hybrid platform capable of all-electric
                      operation at highway speeds, to be used  as a research tool to develop electric/gasoline
                      energy-blending strategies, develop Smart Charging communication techniques, and
                      serve as a benchmark platform for PHEV electric motors and large-capacity batteries.
                      Vehicle uses PSAT-based in-house vehicle-control algorithms.
                      Designed and constructed a flex-fuel-powered series PHEV prototype vehicle that
                      contains Vehicle-to-Grid  bi-directional power flow charging capability as a tool to
                      evaluate/develop control algorithms, various battery sizes/types, and electric machines.
                      This vehicle and evaluation of component technologies are all in support of SAE J1711,
                      J1772, and J2293 standards development.
                  •   Supported a U.S.-Swedish PHEV technology collaboration that included rapid redesign
                      and upgrading of the Volvo Recharge PHEV concept vehicle to include Vehicle-to-Grid
                      intelligent charging capability. This project is an example of Argonne tech transfer.
                  •   Created the Argonne Advanced Powertrain Embedded Controls Systems (APECS)
                      laboratory to develop many of the controller- and software-enabling applications needed
                      to support the goals of the PHEV research program at Argonne.
                      Received Argonne Pacesetter Award for efforts to market Argonne "brand" for PHEV
                      research innovation;  as a  result, Argonne was named the DOE PHEV Lead Laboratory.
                  •   Worked closely with Argonne Technical Services Division (TSD) to produce marketing
                      materials (e.g., press releases, web updates, brochures for sponsors/conference attendees,
                      DVD-ROMs of data and publications). Hosted a full-sized booth at several professional
                      conferences to aggressively promote CTR transportation programs to the engineering and
                      environmental policy community.

                  Vehicle Technology Validation and Benchmarking:
                      Collaborated with Continental Automotive to validate, in a production vehicle, a
                      prototype 14-V alternator synchronous rectification system that replaces the stock

-------
Theodore Bohn - January 2008
                      alternator regulator and effectively is bona-fide "bolt-on fuel economy improvement
                      device" (by measurably reducing accessory load losses) (~1.5 mpg).
                      Implemented an EMI-resistant Rogowski Coil-based AC power measurement system to
                      overcome challenges in the electrically "noisy" HEV test environment.
                  •   Demonstrated the use of a novel Gigantic Magneto-Resistive (GMR) effect field sensor
                      embedded in an integrated power module for an HEV traction inverter to sense current
                      inside the power electronics, where a convention probe will not work.
                  •   Developed world-class in-situ torque sensors, incorporating EMI noise-resistant digital
                      telemetry, to measure pulse-by-pulse engine torque without affecting the
                      functionality/accuracy of the vehicle. This was accomplished by replicating the engine
                      flywheel and matching mass and inertia with instrumented force bridges and wireless
                      sensor power transfer.
                  •   Created innovative, non-invasive torque sensor located inside the transmission input shaft
                      by hollowing out the center of the shaft and adding internal strain gauges.
                      Successfully procured each of the production hybrid vehicles within the stringent
                      DOE/GSA guidelines and numerous justification letters required by all parties involved.
                      These include the 2007 Hybrid Camry, 2006 Civic Hybrid, 2005 Honda Accord Hybrid,
                      2004 Toyota Prius, as well as 170,000  mile end-of-life-study (used) hybrids such as 2000
                      Honda Insight CVT, and 2002 Toyota  Prius.
                  •   Created a real-world dynamometer driving simulator based on physical HEV pedals and a
                      computer-based vehicle model. This device is used for the APRF Driver training
                      program, which develops the  eye-foot  coordination of new vehicle operators to more
                      accurately follow the EPA drive cycle  trace. Vehicle parameters and drive cycles are
                      selectable and feedback on driver accuracy is scored; this information is logged into the
                      central host computer. This is also a quality assurance  measure.
                      Designed and built baseline robotic driver for repetitive vehicle testing at the APRF.
                      System used air-electric brake pedal actuators and direct "by wire" input control to the
                      HEV accelerator pedal command. A newer system is now being constructed with a faster
                      control computer, faster actuators, and better control algorithms.

                  Hardware-in-the-Loop:
                      Participated on initial concept, design,  and construction of the Mobile Advanced
                      Technology Testbed (MATT).
                  •   Conceptualized, designed, and implemented a MATT "virtual inertia" electric motor that
                      not only allows the power rating of the motor to be scaled to emulate smaller HEV
                      motors, but the system can dynamically mimic different inertial driveline
                      components/motors via torque sensors  and real-time torque feedback equations.
                      Participated in a team that created first HIL experiment at Argonne. Based on the
                      bedplate dynamometer, the pre-transmission parallel hybrid diesel-electric hybrid
                      powertrain used an in-house-built constantly variable transmission.
                      Constructed and commissioned an axial flux motor (10 kW), HIL test stand that
                      evaluated mechanically field-weakened wheel motors for future HEV powertrain designs.
                      Powertrain was scaled to one-quarter of total road-load, for one of 4 wheel motors.
                      Constructed both 120 kW battery HIL  test facilities inside the Advanced Powertrain
                      Research Facility (one slow response, one fast response), with battery liquid coolant
                      chiller and environmental chamber for air-cooled tests.
                  •   Initiated new PHEV energy storage system research area for active combination of
                      ultracapacitors, via power electronics,  with Li-ion battery experiments for lower-cost,
                      more-robust energy-storage systems for PHEVs.
                  •   Developed new, novel, and robust current regulation algorithms for maintaining
                      ultracapacitor state of charge  (SOC) under highly dynamic operating conditions.

-------
Theodore Bohn - January 2008
                      Worked with OEM component vendors to study (and reduce) costs of boost converter
                      magnetic components for electronics used in capacitor/battery studies.

                  Advanced Vehicle Technology Competitions (AVTCs):
                  •   Worked with AVTC team to collect competition vehicle performance data and reduce it
                      to a set of scored results for the 1999 FutureCar Competition.
                      Created a new set of competition rules for the 2000 FutureTruck competition, as well as
                      annual revisions of these rules through the 2004 FutureTruck final year.
                      Worked with AVTC team to modify FutureTruck competition rules to match the goals of
                      ChallengeX competition (2005-2008).
                  •   Conducted team on-site inspections and inspections of all participating vehicles at the
                      competition to ensure a safe FutureTruck student vehicle competition for five years of its
                      existence (2000-2004).
                  •   Created high-voltage systems safety and mechanical design "best  practices" guideline
                      document used in safety training for the ChallengeX student vehicle designs.
                  •   Responsible for all competition vehicle electrical safety inspections for ChallengeX
                      (2005-2008).
                      Worked with highly experienced automotive engineers and academics to organize and
                      host the first ever SAE Formula Hybrid competition, May 3-5, 2007. Responsible for
                      overall competition safety as well as high voltage vehicle safety.
                  Laboratory Directed Research and Development (LORD):
                  •   Engine Waste Heat Recovery, System-Level Study: Collaborated with university
                      researchers to investigate total quantity of heat recoverable from engine exhaust and
                      coolant loop. Validated heat flux model showing as much as 7% of the total energy input,
                      or 10% of the total waste heat, could be recovered under an arbitrary city driving load
                      cycle (using Argonne Prius vehicle test data). For the assumptions used in this model,
                      these percentages correspond to increasing the useable engine output from 43 kW (at the
                      drive shaft) to 55 kW (drive shaft + electrical generation).
                  •   Studied advanced spray pattern and micro-channel/mini-channel heat exchangers, along
                      with system-level simulation based on Toyota Prius hybrid vehicle actual drive cycle.
                      Recovered waste heat energy converted to electricity via turbo-expander/generator and
                      added to electricity available for traction power in hybrid powertrain. Future work to
                      implement technology in on-road hybrid was proposed, but unfunded.

                  Work-for-Others: Worked as point of contact and participant in several Work for Others
                  and Technical Services Agreements for outside companies, including:
                  •   Oak Ridge National Laboratory: Instrumentation of 2004 Toyota Prius power electronics
                      drive system for its component benchmarking activities
                      General Electric: Hybrid Delivery Truck powertrain testing and development
                  •   Hyundai: PHEV and in-depth HEV benchmarking
                      SK Battery: Battery hardware-in-the-loop evaluation and tech transfer/training of test
                      methods to SK Battery, Inc.
                  •   University of Alabama- Birmingham: Created a fully instrumented Ford Escape Hybrid
                      for the university's newly formed hybrid vehicle research lab. Trained faculty and
                      graduate students on details of internal power flow of this vehicle, along with the cutting
                      edge custom torque sensors as well as the turn-key National Instruments turn-key data
                      collection system.

-------
Theodore Bohn - January 2008
       Responsibilities:
                  •   Design and implement experiments that advance the state of the art for hybrid electric
                      vehicle technology.
                      Participate in research teams performing complex testing of advanced powertrain
                      subsystems and vehicles, including, battery packs, motors, imported production vehicles,
                      and purpose-built research vehicles.
                      Gather and analyze data collected from complex testing of engines, battery packs,
                      motors, and vehicles.
                      Prepare technical reports and papers that describe the results of R&D on hybrid electric
                      vehicle technology. Present these results at relevant conferences.
                  •   Supervise technicians and students working on equipment in the Advanced Powertrain
                      Research Facility.
                  •   Determine technical goals, provide organizational-logistical support, and maintain a high
                      level of safety for Advanced Vehicle Technology Competitions.
                      Provide DOE sponsors with technology updates and progress summaries of Argonne
                      research.
                  •   Foster relationships with automotive industry component vendors, government agencies,
                      and academia that enhance the hybrid technical community's base knowledge about
                      hybrid vehicle advancements
2000-2004        Renewable Energy Program Manager/Pre-doctoral Researcher
                  University of Wisconsin-Madison, Madison, WI
                  Mr. Bohn was the Renewable Energy Program Manager at University of Wisconsin-Madison,
                  College of Engineering, responsible for fundraising, information dissemination, the teaching
                  of power electronics design for renewable energy applications, and the development of
                  curriculum and accompanying text/reference books. As a pre-doctoral researcher, he worked
                  on developing electric machine and power electronics component models used in the
                  Argonne-PSAT system toolkit.

        Responsibilities:
                      Developed transient response electric motor model for PSAT toolkit.
                  •   Taught course in power electronics design for renewable resources at junior/senior level.
                  •   Raised funds to support renewable energy education program.
                      Developed curriculum for undergraduate renewable energy education.
                  •   Managed financial, human/labor, and equipment resources to achieve student design
                      project goals.
                      Developed control systems for characterizing interior permanent magnet electric
                      machines, such as the motor in the Toyota Prius.

       Achievements:
                  •   Raised $5OK in funds to start up renewable energy education program.
                      Developed power electronics curriculum for renewable energy applications and
                      associated text/reference book.
                  •   Delivered custom-developed transient electric motor model and simulations for PSAT
                      toolkit.
                  •   Designed, built, and tested prototype low-cost/high-performance soft magnet surface
                      PM motor for FfVAC applications.
                      Installed  1 kW of wind, solar/photovoltaic (PV), and fuel cell energy on-site resources.

-------
Theodore Bohn - January 2008                                                                              6


1999-2000        Senior Design Engineer
                  Power Designers LLC, Madison WI
                  Mr. Bohn designed and developed a modular, low-cost interlaced battery management system
                  module, called PowerCheq, to manage large battery systems, such as in a hybrid transit bus.
                  He also designed off-road vehicle drive systems, as well as hybrid vehicle power
                  management and high-power/rapid battery chargers. Before leaving Power Designers Corp
                  (PDC) for graduate school, Mr. Bohn initiated work on fuel cell power conditioning power
                  electronics.

       Achievements:
                  •   Produced low-cost reliable stationary charger for Kwang Yang Motor Company
                      (KYMCO) electric scooters to reduce emissions in Taiwan. Funded by Industrial
                      Technology Research Institute  (ITRI).
                  •   Produced demonstration-level fast-charge system for electric  scooters in Taiwan, with
                      communication from battery management system to charger,  including method to
                      automatically bill owner of scooter being charged.
                  •   Built proof-of-concept PowerCheq battery equalization module, now in high-volume
                      production.
                  •   Participated on team that designed and built prototype PowerCharge 10-kW battery
                      charger used in industrial lift truck charge stations, as well as  ISE Corporation's hybrid
                      buses.
                  •   Designed low-cost sensing and communication interface for PowerTrac battery
                      monitoring system.

       Responsibilities:
                      Produced promotional materials and represented Power Designers at trade
                      shows/conferences.
                  •   Tracked state of the art in power electronics products and competitive assessments of
                      similar products produced by Power Designers.
                  •   Produced feasibility reports for Power Designers marketing group.
                  •   Designed power electronics circuits for commercial electric vehicles.
                      Developed test system software for prototype battery monitoring systems.
                  •   Developed burn-in fixtures for higher-volume-production electronic devices.


September 1982-1992  Engineering Associate- Senior Technical Specialist
                      Fermi National Accelerator Laboratory, Batavia, IL

       Achievements:
                      Commissioned 5,000-amp custom-built prime mover and protection system on
                      superconducting solenoid for Colliding Detector Facility (CDF) experiment.
                  •   Designed custom-application specific integrated circuit robust enough to survive
                      radiation levels at the  beam aperture for silicon microvertex detector (SVX) and sensitive
                      enough to count individual electrons of signal.
                  •   Designed quench detection/protection system for $6M  superconducting solenoid and
                      quench recovery system.
                  •   Produced prototype and sufficient quantity of custom waveform generators for
                      quadrapole steering magnet power supplies in superconducting Tevatron accelerator to
                      correct for higher-order harmonics beam orbit instabilities.

-------
Theodore Bohn - January 2008
       Responsibilities:
                  •   Designed, installed, and commissioned electronic apparatus to support experiments at
                      CDF.
                      Oversaw quality assurance and documentation of installed systems.
                  •   Oversaw trouble shooting and maintenance of mission critical systems on experiments
                      (e.g., Tevatron, CDF, DO Muon line).
                      Characterized radiation hardness and performance degradation of Application-Specific
                      Integrated Circuit (ASIC) signal conditioning devices for Silicon Vertex (SVX) detectors.
                      Performed periodic power system performance/quality upgrades for detector electronics.

                                   Other Relevant Work Experience

2003-2004     Caterpillar Corp., Peoria, IL: (subcontractor) Research Engineer
               •   Constructed open source code controller on prototype dynamometer to develop standardized
                  test procedures to measure critical electrical parameters of production interior permanent
                  magnet motors; led to the characterization of Caterpillar custom motors.

1997-1998     Hyperdyne Corp., Madison, WI: President, Co-founder of S-type Corporation
               •   S-type Corporation founded with colleagues to compete for Small Business Innovation
                  Research grants (SBIRs). Research projects included such topics as development of
                  algorithms to track battery state of charge, state of health, and instantaneous power capability
                  of electric vehicle batteries. Proof-of-concept products included a power electronics unit for a
                  higher-efficiency electronic "fish fence" to contain migration of invasive non-native species
                  that can cause unnecessary fouling of water inlet hardware.

1996-1997     Industrias Murrell, Guadalajara, Mexico: Electrical Engineer Consultant
                  Designed proof-of-concept range-extended clean hybrid industrial burden  carrier, legal for
                  use as delivery vehicle in Mexico. Project sponsored by Mexican government to reduce
                  emissions in Mexico City by producing a delivery vehicle capable of driving from remote
                  warehouse to downtown on propane-powered internal-combustion (1C) engine, then electric
                  mode for delivery of goods down narrow streets where conventional delivery trucks will not
                  fit.

1995-1996     Columbia Par Car,  Reedsburg, WI: Electrical Engineer
                  Started as consultant hired to resolve noise-vibration-harshness (NVH) problems arising from
                  use of new 4-stroke engine in golf cart design, for Mazda spin-off joint product. Responsible
                  for implementing electric drive systems in custom tram vehicles, industrial burden carriers,
                  and specialty golf carts. Qualified potential charger and drive electronics for future products.
                  Performed range and durability benchmark studies.

1994-1995     Kohler Company - Generator Division, Kohler, WI: Researcher/Electrical Engineer
               •   Developed proof-of-concept solid-state generator set based on latest state-of-the-art
                  components, such as coaxially wound boost power transformers, for market study.

1994-1994     GM-Advanced Technology Vehicles, Torrance, CA: Electrical Engineer
                  Worked on high-power inductively coupled battery charger for EV-1 electric car as an
                  extension of university research. Initiated series hybrid APU for RE-29 transit bus to study
                  low-noise, low-emission range-extending technologies, via reduced auxiliary loads.

1994-2004     EVRx Electric Vehicle Design/Development, Madison, WI: Owner/Consultant

-------
Theodore Bohn - January 2008                                                                              8


                  Electric vehicle design consulting service founded as a result of connections and contacts
                  made through DOE Advanced Vehicle Technology Competitions. Focus of the enterprise was
                  on energy storages systems, power electronics/machines, and controls.

1989-1994    University of Wisconsin-Madison, High Energy Physics Department: Electrical Engineer
                  Continuation of Fermilab-based experiment apparatus design. Developed very high speed
                  trigger processor systems (1 GHz throughput) for the DO-Muon detection system at the
                  Tevatron proton-antiproton collider at Fermilab. Worked as part of a team on wire chamber
                  particle detectors for the (proposed) SuperCollider in Waxahachie, TX, as well as detector
                  electronics for the Large Hadron Collider (LHC) at CERN, France.

1982-1982    Kohler General Corp., Sheboygan Falls, WI: Engineering Intern
              •   Led efforts to design, construct, program, and evaluate a low-cost programmable controller
                  for a polystyrene thermal expansion press that produced formed packing inserts for
                  Craftsman Tools. Project used (at the time, cutting edge) a Zilog Z-80 single-chip
                  microprocessor on $200 single-board computer as the basis for a low-cost alternative to a
                  $2,000 commercially available Texas Instruments Programmable Logic Controllers (PLC).

1977-1999    Sunshine Satellite Systems, Cleveland, WI: Founder/owner/operator
              •   Started as apprentice for communications equipment repair/refurbishment business. New
                  digital era satellite communications afforded an opportunity to start a small business based on
                  installing and maintaining Very Small Aperture Terminals (VSAT) for retail stores (ground
                  satellite terminal), as well as home-based satellite receivers.

Professional Societies (chosen to be consistent with job responsibilities)

              Society of Automotive Engineers  (SAE)
              Institute of Electrical and Electronics Engineers (IEEE)
              IEEE Power Electronics Society (PELS)
              IEEE Industrial Applications Society (IAS)

Honors and Awards

              1997 Granger Outstanding Power Engineering Student Award (undergrad)
                  2001 Focus on Energy $2,000 Scholarship for design of grid-tied power inverter
              2002 Granger Outstanding Power Engineering Student Award (graduate)
                  2003 Tong Innovative Student Design Award (low-cost third-world electric vehicle)
                  2005 Recipient of an SAE Transactions Paper Award (Characterization of Variability in
                  4WD Dynamometer Testing Results Due to Tie-Down Methods)
                  2007 Argonne Pacesetter Award for establishing Argonne as DOE lead on PHEV research
                  2008 Society for Technical Communications "Distinguished Award" for PHEV informational
                  materials (brochures and posters), developed with Argonne TSD staff
                  2008 Nominated for R&D100 Award for ARDAQ real-time  data acquisition system

Patents
              US Patent applied for — Real-time In-Vehicle Emulation Toolkit
              This patent applied for as enhancement of Argonne's Real-time Data Acquisition System
              (ARDAQ) that allows users to emulate future technologies, with a conventional production
              vehicle, in real time.

Organizational Activities (subset)

-------
Theodore Bohn - January 2008
              Session Chair of Advanced Battery Technology Committee, SAE World Congress 2008
              Session Chair of Fuel Cell Committee, SAE World Congress 2007
              General Committee of the 23rd Electric Vehicle Symposium, Anaheim CA, 2007
              Organizer of International Electric Machines Designer Conference, 2003
              SAE Electric Machine Rating Standards Task force—current
              SAE J1772 Electric/Hybrid Vehicle Conductive Charging Equipment Standards—current
              SAE J1711 Recommended Practice for Measuring the Exhaust Emissions and Fuel Economy of
              Hybrid-Electric Vehicles—current
              SAE J2238 Energy Transfer System for Electric Vehicles: Functional Requirements, System
              Architectures, and Communication Messaging—current
              Peer reviewer for IEEE conferences (APEC, IAS, PESC, IEMDC) and SAE World Congress
Community Service (subset)
              Volunteer — Introduce a Girl to Engineering Day (IGED) program 2007, 2008
              Volunteer — Mentor for Future Energy Challenge design competition 1999-present
              Volunteer — Habitat for Humanity 1990-present
              Volunteer — Adult Literacy Program 1985-1990

Publications: Journal Articles and Book Contributions
              (listed as  separate document)

-------
                                     LINOS J. JACOVIDES

                            A native  of Paphos, Cyprus, Dr. Linos J. Jacovides received
                     Bachelor's  and Master's  degrees in Electrical Engineering, from the
                     University of Glasgow, Scotland, and a Doctorate in Generator Control
                     Systems from the Imperial College, University of London, in 1965.

                            Dr.  Jacovides  was  most recently  Director, Delphi Research
                     Labs, from December of 1998 until he retired in January of 2007.  This
                     was the Central research operation for Delphi with a budget around
                     $20M  and involved a  group of about 90 researchers dealing with
                     advanced projects - 5  to  15 year horizon.   The staff  has  mostly
                     doctorates in physical sciences and engineering with at least 10 Fellows
of IEEE, SAE, and the American Physical Society.  In this post,  he  was responsible for R&D in
the following areas: Manufacturing Processes, Materials, Devices, Mechatronics, Polymers, and
Systems.   Unlike some Corporate  Research  Labs  the  funding was based  on voluntary
contributions from the Business  Units (BUs).    Although  in  many  industrial  labs such  a
mechanism leads to short term projects, an agreement was reached  that 30% of the  budget
would be allocated to long term exploratory projects at the discretion of  the Lab Director. The
remaining 70% was for projects that were approved by the BUs.  This worked very well until the
company declared bankruptcy in 2005.

       He joined General  Motors Research  and  Development  in  1967 after  a two-year
assignment at the Defense Research  Laboratories  in Goleta, California.   He held several
positions at General Motors Research becoming one of GM's youngest  executives at age 35.
He became department head, electrical engineering in 1985.

       His areas  of research were the  interactions between power electronics and electrical
machines in electric vehicles and locomotives.  He worked on some of the electric  vehicles of
the 60's to the 80's at GM. By the 80's he argued against commercializing the EV1  maintaining
that the batteries were not ready for the  market.   At Delphi his technical  interests were  on fuel
economy, electronics and alternative  fuels. He is the author of ten  peer  reviewed articles, two
patents and several internal research reports.  He edited the first  SAE  special publication on
Electric Vehicles.

       Since retirement he acted as a consultant to Delphi for several months, to help formulate
Delphi's strategy on fuel economy. Since September of 2007 he is  also on four Committees of
the National Academies  to assess various aspects of vehicle technologies for improving fuel
economy. His contributions are in the area of vehicle  propulsion (internal combustion, hybrids,
fuel cell and plug-in hybrids). He is also a member of the Visiting Committee for the EE Dept at
Michigan State University

       He is a Fellow of the Institute of  Electrical and Electronics Engineers (IEEE), where he
served as President of the Industry Applications Society in 1990.  He is also a 43 year member
of SAE and was recently elected  Fellow for  his  work on electric propulsion.   He  was  a
representative of Delphi at the Industrial Research Institute.
Linos Jacovides                           1                                1/12/2011

-------
                               Resume


Education
B.Sc. 1961, (1st Class Honours, Electrical Engineering) University of Glasgow,
Scotland - Prize for".. the most distinguished graduate of the year in the
engineering faculty".
M.Sc. 1962, University of Glasgow - Thesis on synchronous machine theory.
Ph.D. 1965, Imperial College, University of London, England-Thesis on electric
power grid stability control systems.
Goethe Institut German for foreign students - summers of 1960 and 1961

Employment
Consulting
   •  Expert witness in case against the Army
   •  Taught classes on electric drives at University of Michigan
   •  Member of Board of Directors Novolyte Technologies -Electrolytes for Lithium ion
      batteries
   •  National Research Council - Economy Assessment of Resource Needs for
      Development of Fuel Cell and Hydrogen Technology & Potential Impacts of Plug-
      In Hybrid Electric Vehicles.
Delphi
   •  Special assignment to formulate Delphi strategy on fuel economy 2007-08 (4
      months)
   •  Director Delphi Research Laboratories  (Executive Position) 1999-2007
General Motors Research Laboratories
   •  Chief Scientist Delphi Energy and Engine Management 1994 - 99
   •  Head, Electrical and Electronics Department, 1988- 99 (Executive Position)
   •  Principal Research Engineer, EE Dept., 1987-1988
   •  Asst. Department Head, EE Dept, 1985-1987 (Executive Position)
   •  Senior Staff Research Engineer, EE Dept., 1975-1985 (Executive Position)
   •  Senior Research Engineer, EE Dept., (Special bonus awards 1969, 1970, 1972),
      1970-1975,
      Research Engineer, EE Dept., 1967-1970
GM Defense Research  Laboratories, Goleta, California, 1965-1967
1959 Summer intern Ferranti Limited Manchester. UK
1961 Summer intern Siemens & Halske Karlsruhe. Germany
Professional Societies
IEEE Fellow 1990
IEEE Industry Applications Society
      Society President 1990 Vice President  1989 Secretary 1988
      Chairman of the  Industrial Power Conversion Systems Department 1986-88
      Chairman of the  Industrial Drives Committee 1984-85
IEEE Power Electronics Society - past member
IEEE Magnetics Society- past member
Linos Jacovides                         2                            1/12/2011

-------
SAE (past chairman of both the Electric Vehicle Committee and the Electrical and
Electronics Systems Committee)
Institution of Electrical Engineers, (IEE) England - past member

Invited Talks
   •  An Electrical Engineer in the Automobile Industry
   •  Student Activities Committee
   •  IAS Annual Meetings 1986 and 1987

Technical activities
   •  Organized many technical sessions in technical meetings for both the SAE and
      the IEEE. Starting in 1970
   •  Initiated a series of Global Technical conferences where Delphi engineers could
      present their advanced work
   •  Technical Vice  Chair for Convergence in 2000 and 2004. convergence is the
      premier conference for automotive electronics and the Vice chair is actually the
      person in charge  of the program
   •  National Research Council.  Committee memberships
         o  Assessment of Technologies for Improving Light-Duty Vehicle Fuel
            Economy 2007 to 2010
         o  Review of the FreedomCAR and Fuel Research and Development
            Partnership, Phase 3. 2009 to 2010
         o  Transportation Research Board. Chair of PANEL SP20-83(04) Effects of
            Changing Transportation Energy Supplies and Alternative Fuel Sources on
            State Departments of Transportation. 2009 to 2012

Publications
1.  "A Critical Evaluation of AC Motor Drives for Traction," B. V. Murty and L. J.
Jacovides.  Presented at the 20th Intersociety Energy Conversion Engineering
Conference, Miami, FL, Aug. 18-23, 1985.

2.  "Brushless Motor Drive for In-Tank Fuel Pump," B. R. Patel, L. J. Jacovides, J. G.
Neuman. Presented at the 1984 SAE Congress Feb. 27 Mar. 2 1984.  SAE Paper No.
84445.

3.  "A Cycloconverter-Synchronous Motor Drive for Traction Applications," L. J.
Jacovides, M. F. Matouka, and D. W. Shimer. IEEE Trans. Industry Applications Vol. IA-
17 #4, pp. 407-418, (Jul/Aug. 1981).

4.  "An Improved Triggering Method for a High-Power Cycloconverter-lnduction
Motor Drive," IEEE Trans.  Industry Applications Vol. IA-15 #5, pp.
      472-481,  (Sept./Oct. 1979).
Linos Jacovides                         3                             1/12/2011

-------
 5. "Electric Vehicle Simulation Program," R. H. Nelson, L. J. Jacovides, F. J.
Schauerte, and E. J. Woods.  Presented at the International Electric Vehicle
Symposium, Philadelphia, PA, October 2-5, 1978. Published at the Conference
Proceedings.

6.  "Digital Simulation of a High-Performance AC Drive System, Part II," S. D Rajan, L. J.
Jacovides and W. A. Lewis.  IEEE Trans. Industry Applications Vol. IA-10 #3, pp. 397-
402,  (May/June 1974).

 7. "Digital Simulation of a High-Performance AC Drive System, Part-l," S. D. Rajan, L.
J. Jacovides and W. A. Lewis. IEEE Trans. Industry Applications Vol. IA-10 #3, pp.  391-
396,  (May/June 1974).

8.  "Analysis of a Cycloconverter Induction Motor Drive System Allowing for Stator
Current Discontinuities," IEEE Trans. Industry Applications Vol.  IA-9#6, pp. 206-215,
(Mar/Apr 1973).

9.  "Analysis of Induction Motor Drives with Non-sinusoidal Supply Voltage Using Fourier
Analysis." IEEE Trans. Industry Applications Vol. IA-9#6, pp. 741-747, (Nov/Dec 1973).

10. "Effect of Excitation Regulation on Synchronous Machine Stability," L. J. Jacovides
and B. Adkins. Proc.  IEE Vol 113, #6, pp. 1021-1033 (June 1966).

11. "The Effect of Regulation of Excitation on the Stability of Synchronous Machines."
Ph.D. Thesis, Imperial College, University of London, August, 1965.

12. "The Inductance Matrices of the Salient Pole Synchronous Machine," M.Sc. Thesis,
University of Glasgow, Scotland, September, 1962.

Patents
Induction Motor Fabrication Method  3,705,971  Dec. 12, 1972
Method of Induction Brazing a Complex Assembly 4,443,678,   Apr. 17, 1984

Reports
There are several research reports that are GM or Delphi confidential.  However the
titles of three recent ones may be relevant.

1.  Alternative Fuels and the Impact on Delphi - Global Issues. Delphi Research Labs
report No 385 2006
2. Alternative Fuels and the Impact on Delphi - Regional Assessment. Delphi Research
Labs report No 400. 2006
3.  Fuel Economy - Strategic Analysis. Assessment of Delphi's Strategy to improve
vehicle fuel economy. Innovation Technology Office 2008
Linos Jacovides                         4                              1/12/2011

-------
                                  LINDA M. MILLER
                               miller1249@comcast.net

27500 West River Road                                        Residence: 734-692-2621
Grosse lie, Michigan 48138                                        Cellular: 313-218-6075

                                CAREER SUM MARY

A results-driven senior manufacturing executive with extensive experience in automotive
component manufacturing, business planning and supply base development. Demonstrated
ability to build consensus among diverse groups through creation of common goals and
objectives.  Significant experience in global operations management, operations consolidation
and new program management. A strong track record of delivering objectives through the
effective development of people, ability to handle difficult Union relationships and effective
communication skills.

                            PROFESSIONAL EXPERIENCE

FORD MOTOR COMPANY, Dearborn, Ml                                       1973-2007
Automotive Manufacturer

   Director of Manufacturing, Powertrain Operations                2005-2007
   Responsible for the performance of 9 engine, casting, forging and electronic components
   plants in the United States, Mexico and Canada with a combined business of $950M.

   •  Developed a strategic plan for standardization of key systems across all plants that
      delivered 15-20% annual improvement in cost and quality performance metrics.
   •  Led Union negotiations around out-sourcing of non-critical indirect labor and streamlining
      of classifications that resulted in reduced operating costs.
   •  Championed the Powertrain Environmental and  Quality Councils and Six Sigma efforts
      working to achieve common operating systems across all powertrain plants.
          o  Key elements of operating systems were agreed upon and are under
             implementation.
   •  Chaired the  Powertrain People Development Committee ( PDC ) and Manufacturing
      Leadership Program that led to identification and development of a diverse group of high
      potential employees.
   •  Acted as Co-chair of the steering committee for Women in Manufacturing and through
      participation in the Executive Council on Diversity was the formal / informal mentor for
      over 25 men and women in manufacturing.

   Director of Manufacturing, V-Engine and Casting,                2002-2005
   Powertrain Operations
   Responsible for the performance of seven engine and casting plants in Canada and the
   United States with a combined business of $700M.

   •  Developed cost, quality and safety processes resulting in cost improvements that
      averaged 8% annually across all plants, warranty and internal quality improved over
      10% per year and safety metrics improved over  15% annually.
   •  Successfully negotiated and led implementation of the idling  of a forging plant and an
      aluminum  casting plant.
   •  Led a cross-functional task force that enabled development and production of a cost -
      effective all new 3.5L engine. Innovative engineering design and manufacturing
      processes saved $1,800 per unit.
   •  Teamed with the Group Vice-president of Manufacturing to develop and launch the
      Women in Manufacturing organization as one of Ford's employee resource groups.

-------
Linda M. Miller                                                                  Page 2

FORD MOTOR COMPANY, ( continued )

   Director of Manufacturing, Casting Operations,                 2000-2002
   Powertrain Operations
   Responsible for the performance of all eleven casting and forging plants world-wide with a
   combined  business of $400M. In addition, responsible for divesture and / or consolidation of
   facilities wherever feasible.

   •  Initiated lean manufacturing principles which enabled the US and Canadian plants to
      achieve 5% performance improvements annually and meet operating budget for the first
      time.
   •  Led divestiture or joint venture partnerships for plants in Argentina, New Zealand and the
      aluminum plants in Canada and created strategy for the closure of four plants in the US
      and Canada that resulted in closure of three and pending closure of 4th.
   •  Managed the Staff Castings Manufacturing Engineering Group responsible for
      development of new manufacturing technology and for providing manufacturing technical
      assistance for supply base.
           o  Teamed with  outside supplier and product engineering that developed the first
              high volume,  high pressure die cast aluminum cylinder block for Ford.
   •  Ford Senior Representative in the American Foundryman's Society.
           o  Led the effort for the society to become more inclusive by changing the name to
              American Foundry Society.
           o  Advanced the development of student education through participation in the
              Foundry Education Foundation ( FEF) seminars as a keynote speaker.

   Director, Manufacturing  Business Office, Ford Motor Company  1998-1999
   Directed the work of the world-wide business offices for vehicle and powertrain
   manufacturing in the development of a world-wide manufacturing business plan that would
   complement the global product development cycle plan.

   •  Achieved economies of scale by moving all four cylinder engine manufacturing
      development to Europe and consolidating v-engine work in the United States.
   •  Identified opportunities for the introduction of flexible manufacturing technologies that
      maximized the ability of manufacturing to react to late cycle plan changes.
   •  Assessed the proposed manufacturing plans for South  America, India and China and
      achieved maximum  asset utilization.
   •  Developed the supplier park concept for Ford of Europe that reduced logistic and hourly
      workforce costs.

   Director, Supplier Technical Assistance, Ford Purchasing        1995-1998
   Responsible for globalizing and consolidating the various supplier quality and technical
   support groups in  Ford world-wide.

   •  Developed and implemented a common system of supplier evaluation and performance
      measurement that enabled effective sourcing of product based on quality and cost.
   •  Streamlined the organization by eliminating  multiple interface points with the same
      supplier resulting in  a 30% reduction in staffing.
   •  Developed a supplier accessible electronic data base for performance metrics that
      allowed suppliers to react more quickly to quality trends.
             o   Improved supplier quality 40% over three year period.
   •  Led a team of key suppliers and internal personnel that developed a methodology for
      warranty sharing between Ford and suppliers which became a benchmark in the industry
      and significantly reduced Ford warranty costs.

-------
Linda M. Miller                                                               Page 3

FORD MOTOR COMPANY, ( continued )

   Plant Manager, Dearborn Engine and Fuel Tank Plant            1993-1994
   Managed a three shift plant manufacturing four cylinder engines and all of the steel fuel
   tanks for Ford cars and trucks.  Employment of 1500 union and salary employees.
   Responsibility also included design cost reduction and new program implementation.

   •  Negotiated unique operating patterns and developed new technology applications to
      reduce the original planned  investment in a new engine program by 35%.
   •  Reduced operating costs by 10% while improving engine warranty costs by 11% and
      becoming the first Ford plant to achieve the Total Quality Excellence award.
   •  Improved results in the Plant Leadership Behavior Survey by 40% through a series of
      actions recognizing employee contributions and instituting quarterly small group
      meetings with all salary personnel with an emphasis on candid dialogue.

   Asst. Plant Manager, Cleveland Engine Plants                   1991-1993
   Responsible for running Cleveland  Engine Plant 1 manufacturing the 4.9 and 5.0L engines.

   Manufacturing Manager, Essex and Windsor Engine Plants       1989-1991
   Responsible for production, quality and manufacturing engineering at the Windsor and
   Essex Engine plants.

   Manufacturing and Plant Engineering Manager,                 1987-1989
      Dearborn Engine Plant
   Quality Control Manager, Dearborn Engine Plant                 1985-1987
   Supervisor, Planning and Material Cost Reduction,               1983-1985
      Engine Division
   Production Superintendent, Dearborn Engine  Plant              1982-1983
   Inspection Superintendent, Dearborn Engine Plant               1979-1982
   Quality Control Engineer, Engine Division                       1978-1979
   Supplier Quality Assurance Representative, Engine Division      1976-1978
   Quality Control Analyst, Engine Division                        1973-1976

                                   EDUCATION

MBA, Management, University of Detroit, Detroit, Ml                                  1981
MA, Mathematics, University of Kansas, Lawrence, KS                               1972
BS, Mathematics, Northeast Missouri State University, Kirksville, MO.                   1970

                           MEMBERSHIPS / AFFILIATIONS

President, University of Detroit-Mercy Business School Advisory Board           1999-present
President, Truman State University Foundation Board                         2004-present
Co-Chair, Board of Trustees, Wayne State University / Ford Motor                 2000-2006
Engineering Management Master's Program
Member, Women's Automotive Association International                       2004-present
Member, American Foundry Society                                          2000-2006
Member,  Board of Directors, Cleveland Opera                                  1991-1993
Member,  United Way Leadership Giving Council, Canada                        1989-1991

                           AWARDS AND RECOGNITION

Distinguished Alumni Award, University of Detroit-Mercy, Business School              2005
100 Leading Women in the Automotive Industry, Automotive News              2000 & 2005
Spirit of Leadership Award, Women's Automotive Association International              2004
Alumni of the Year, Truman State University                                        2002
Magnificent Seven Award, Business and Professional Women's Club                   1997
Pilliod Lecturer, Kent State University                                              1995

-------
                     DEEPA RAMASWAMY, PH.D.

                                                                                  (734) 507-9302
http ://www. hybridchakra. co m                                                deepa@hybridchakra. com


SUMMARY OF QUALIFICATIONS	

Extremely  motivated and  results-driven management,  engineering and business development professional with
exceptional oral and written communication skills and an extensive background in the following broad-based
competencies:
BUSINESS DEVELOPMENT               ENGINEERING CONSULTING                     HYBRID SYSTEMS
PRODUCT DEVELOPMENT                PROGRAM MANAGEMENT                     BATTERY SYSTEMS
RESEARCH & DEVELOPMENT              SYSTEMS ENGINEERING               CONTROLS & ELECTRONICS
MODEL-BASED ENGINEERING             SALES & NEGOTIATION            RAPID PROTOTYPING SYSTEMS
DESIGN VERIFICATION & VALIDATION      EMBEDDED SYSTEMS      FAILURE MODES & EFFECTS ANALYSIS


    •   One of only a  handful of people who have been integrally involved with an OEM production hybrid
       program from program inception to launch.
    •   Extensive and professionally recognized engineering and business development skills in the areas of hybrid
       systems, plug-in hybrids, battery systems and controls and electronics.
    •   Demonstrated project leadership and program management skills with ability to build talented teams and
       generate high customer satisfaction.
    •   Proven capacity to lead large  engineering teams in fast-paced product development environments and
       expeditiously deliver novel complex  systems.
    •   Deep technical expertise in electrical engineering and control systems with the ability to combine project
       and team management skills with technical expertise to develop and implement high quality solutions.
PROFESSIONAL EXPERIENCE	

HYBRID CHAKRA CONSULTING, LLC. - Canton, Michigan                       May 2009-Present

Founder and CEO

Founded a consulting company that offered services in the hybrid vehicle, plug-in hybrid vehicle, electric vehicle
and alternative energy domains.

    •   Provided program management,  systems engineering, systems architecture, modeling & analysis and
       embedded controls design consulting support to OEMs, Tier Is, suppliers and other entities.
    •   Provided independent reviews of proposals,  analyses and reports created by other entities (suppliers,
       service providers) in these domains.
    •   Completed projects in the area of battery system management, vehicle control system development and
       simulation analysis of hybrid system architectures.
    •   Offered market/technology survey services.
    •   Offered training in the areas of hybrid controls, hybrid architectures and plug-in hybrids.
    •   Offered business development services in above listed domains.

-------
                      DEEPA RAMASWAMY, PH.D.

                                                                                     (734) 507-9302
http ://www. hybridchakra. co m                                                   deepa@hybridchakra. com
RICARDO, INC. - Van Buren, Michigan                                              July 2007-April 2009

Chief Engineer, Hybrid Systems, Controls & Electronics

Performed business development and engineering consulting in the domains of hybrid systems, battery systems and
controls and electronics. With high-level contacts from over 150 companies nationwide in these fields,  developed
leads, authored proposals, conducted negotiations and led  numerous projects to  completion. As a result of
exceptional performance, selected to head up the hybrid activities for Ricardo in the US.

    •  Demonstrated excellent business  development ability by winning $6.6 million  of order intake during
       tenure.
    •  Won Employee of the Month Award for managing a $5 million project and received a very high "Voice
       of the Customer" rating of 9.6/10 from the customer.
    •  Recognized as a top performer and received  an "Exceptional" performance review rating during annual
       performance review.
    •  Identified a market need for Battery Systems development and supported development of business case for
       the establishment of a $2 million state of the art Battery Systems Development Center and organized the
       well attended Open House.
    •  Authored numerous proposals in the following topics: hybrid system development, vehicle integration,
       Plug in Hybrid Electric Vehicle  (PHEV) development, battery pack development, battery management
       systems,  active safety  control systems, PHEV  market studies, model based  control system design,
       electronics development, modeling , simulation of vehicles, design verification and production validation
       (DV/PV) of components and systems, Hardware in the loop (HIL) testing, dyno testing, vehicle testing.
    •  Led technological aspects  of proposal development for DOE Funding Opportunity Announcement on
       Transportation Electrification (DE-FOA-0000028), including partner selection and concept definition.
    •  Developed workplans, established budgets, conducted negotiations with customers and executed projects to
       maximize the return to the company and to provide high value to the customer.
    •  Won and led projects including the following:
           o   Active Safety Control System development for a major automotive OEM.
           o   Conversion of a hybrid vehicle to a PHEV for a major commercial vehicle Tier 1.
           o   Market study  of the US  PHEV market  for a major  automotive OEM  and recommendation of
               PHEV type and timing.
           o   Training in battery technology and systems for a major commercial vehicle Tier 1.
           o   Simulation of propulsion systems for a marine Tier 1.
           o   Investigation of state of the art communication protocols in a Battery Management System for a
               Battery Tier 1.
    •  Provided technical expertise and knowledge to support projects including the following:
           o   Review and update of the hybrid technology decision tree on  the NHTSA Notice for Proposed
               Rulemaking (NPRM) for CAFE standards for MY 2011-2015.
           o   Virtual vehicle development environment for battery systems.
           o   A Fuel Economy Demonstrator program for the military.

-------
                      DEEPA RAMASWAMY, PH.D.

                                                                                      (734) 507-9302
http ://www. hybridchakra. co m                                                   deepa@hybridchakra. com


FORD MOTOR COMPANY - Dearborn, Michigan                                         1995 - June 2007

Supervisor, Research & Advanced Engineering                                          2004 - June 2007

Directly supervised a team of nine experts in the design of architecture and algorithms for next-generation hybrid
control systems and guided the work of about 40 engineers in the department. Developed common global control
systems across Ford, Jaguar, Land Rover and Volvo products. Ensured smooth technology transfers from advanced
engineering  to  product  development.  Created work and  resource  plans  to  ready new technologies for
implementation. Presented the program strategies to upper management.

    •   Drove a common development process across global brands that maximized product re-use and minimized
        the resources required for product development with a projected resource reduction of 60%.

    •   Proposed control system hardware architecture with maximum portability between vehicle  configurations
        that allowed for easy migration across engine, transmission and brake technologies.

    •   Instilled a sense of team discipline in all work by establishing clear processes, plans and deadlines; fostered
        strong relationships with production department that shifted team focus to delivering long-term solutions.

    •   Recognized as Top  Achiever on performance review rating;  consistently  received high performance
        review ratings.

    •   Led development of an Integrated Modeling Environment, facilitating reuse of Legacy products and
        enabling model-based  control system development,  system level  simulation and  automatic C-code
        generation.

Supervisor, North American Product Development                                             2000 - 2004

Promoted to  lead development of the powertrain control system for the Ford Hybrid Escape SUV  program. Built a
superior team of engineers and coordinated interaction with other engineering teams and global suppliers to ensure
timely  delivery and high product quality. Managed capital, material and travel budget  costs of $2 million and
coordinated interaction with global suppliers from Japan and Europe. Analyzed  impact of intellectual property
issues.  Reviewed  designs, created work plans and employed multiple systems engineering tools.  Supervised an
engineering team of 17 to create specifications and design the control software for prototype vehicles.

    •   Won the  Henry Ford  Technology Award in 2005 for leading the team that built  the first  production
        vehicle system controller for a U.S. automotive company.

    •   Developed and launched the  company's most  complex  system in its vehicle  lineup to control the hybrid
        SUV that  achieved a 50% improvement in fuel economy for a super ultra-low emissions and AT-PZEV
        rating; acknowledged with J.D. Power reviews for high quality.

    •   Established six new processes for controller design and validation including the  use of rapid prototyping
        that reduced development time by 70% and the  use of hardware in the loop systems for design verification.

    •   Formulated supplier strategies and secured the best possible quotes by negotiating statements of work with
        purchased service  suppliers; identified ways to use existing resources that reduced purchase order amounts.

    •   Featured as a key hybrid powertrain system supervisor  in  Fast Company and Global Auto Insider
        magazines.

    •   Delivered a Ford First product on time that met high quality standards and allowed the company  to launch a
        new product which won the 2005 North American International Auto Show Truck of the Year award.

-------
                      DEEPA RAMASWAMY, PH.D.

                                                                                    (734) 507-9302
http ://www. hybridchakra. co m                                                  deepa@hybridchakra. com

Controls Engineer                                                                       1998 - 1999
Charged to develop the control system for the company's first production hybrid electric vehicle.  Designed high
level programs using MATLAB and Simulink software and followed up with automatically generated C code to
quickly test designs on actual  prototypes.  Pioneered the use of the dSPACE MicroAutoBox rapid prototyping
system on a production vehicle program that significantly reduced control system development time. Transferred
fledgling product technology from advanced research facilities smoothly into production.
Automotive Electrical Engineer                                                            1995 - 1998

Gained extensive exposure to the full spectrum of automotive engineering activities through a two-year rotation
program.  Benchmarked graphical user interface development tools. Created graphical user interfaces for engine
simulation programs. Supported the electrical system launch for the Lincoln Continental's 13 onboard computers.
Challenged to  apply core engineering knowledge and skills by modeling  several electromechanical vehicle
components to support vehicle-level electrical simulation.

BUSINESS EXPERTISE

    •  Business Development: Identification of target markets, customer contact and lead development.

    •  Proposal Development: Proposal technical writing, workplan development and resource allocation.

    •  Sales and Negotiation: Review of terms and conditions, Purchase Orders  (POs) and "closing  the deal"
       with a win-win attitude.

    •  Program Management: Leading  projects and  managing within budgeted resources  and with high
       customer satisfaction.

TECHNICAL EXPERTISE	

    •  Hybrid and Battery Systems: System architecture, vehicle integration, system prototyping, development,
       verification and validation.

    •  Control Systems: Algorithms, software and hardware embedded system controls for hybrids,  batteries,
       powertrains and active safety.

    •  Computer Modeling/Simulation: MATLAB, Simulink,  C, C++, UML, UNIX, Microsoft Windows and
       Office, HTML, Saber, Modelica and Tcl/Tk.

    •  Systems Engineering  Tools: Requirements, design verification methods  and plans,  failure mode and
       effects analysis, robustness analysis, 8Ds, fishbone diagrams, fault tree analysis and design of experiments.

PATENTS AND PUBLICATIONS	

    •  Received five patents with four additional patents pending.

    •  Authored three SAE conference papers, one ASME conference paper, five IEEE conference papers and two
       IEEE journal publications.

    •  Invited speaker at the Detroit Electrochemical Society meeting (joint meeting with Wayne State University
       COE) in November, 2010.

-------
                  DEEPA RAMASWAMY, PH.D.
                                                                    (734) 507-9302
http ://www. hybridchakra. co m                                         deepa@hybridchakra. com

EDUCATION AND CERTIFICATION	
UNIVERSITY OF ILLINOIS AT URBANA-CHAMPAIGN                           Champaign, Illinois
Doctor of Philosophy in Electrical Engineering                                           1995
Master of Science in Electrical Engineering                                             1991

INDIAN INSTITUTE OF TECHNOLOGY                                          Madras, India
Bachelor of Technology in Electrical Engineering; graduated 1st in class                         1989

FORD MOTOR COMPANY                                              Dearborn, Michigan
Six Sigma Greenbelt Certification                                                    2003
CITIZENSHIP
U.S.

-------
Appendix C. Peer Reviewer Comments As Submitted
                        C-1

-------
Appendix C. Peer Reviewer Comments As Submitted
                    B-2

-------
             U.S. Environmental Protection Agency (EPA) Peer Review
                       of Draft Report, FEV 07-069-3 03F Dated February 22, 2011
               "Light-Duty Technology Cost Analysis Power-split and P2 HEV Case Studies"
                                   Peer Review by Theodore Bohn
                                          March 15,2011
Overview of the Draft Report
The "Light-Duty Technology Cost Analysis Power-split and P2 HEV Case Studies" describe FEV's
methodology for determining incremental, direct manufacturing costs to estimate the costs of technologies
likely to be used in meeting future light-duty highway vehicle greenhouse gas (GHG) emissions standards.

The methodology consists of the following approach:

- Cost analysis of the production hardware systems was performed as follows:
       - Tear down of the production hardware systems
       - Evaluation on a part-by-part basis of observed differences in size, weight, materials, machining steps
             and other parameters affecting cost.
- Use of databases for material  costs, labor rates, manufacturing overhead rates, mark-up rates and packaging
       costs to calculate costs to fabricate individual parts and subsystems which are added together to provide
       the overall system costs.


Following the costing methodology overview, the incremental cost impact of adding power-split hybrid electric
vehicle (FIEV) technology to a conventional baseline vehicle was discussed. The analysis is based on the detail
teardown and costing of the hardware difference, applicable to the adaptation of power-split FIEV technology,
found between the 2010 Ford Fusion HEV, and an equivalent equipped 2010 Ford Fusion conventional
powertrain vehicle. A description of the hardware required to create the power-split technology is highlighted
and details on the costs are captured at various levels.

Specific cost analysis was provided for Integrated Motor/Generator and clutch assembly system costs were
broken out for the P2 configuration.

The study concluded that the net incremental/assembly cost impact to the OEM was $ 3,435.01for the power-
split topology in the large vehicle segment (Ford Fusion sized chassis), and $3564.66 for the P2 configuration in
the same size of chassis.

This reviewer's area of expertise concerns electric machine technology and control of electric machines as well
as hybrid control systems. Remarks in this review are  subjective and the reviewer's knowledge of actual
manufacturing costs vs engineering level component costs is limited to first hand procurement of prototype
systems contrasted with cost/performance design goals for electric machines.

-------
In the format of the provided reviewer template, the following comments on the document are offered:
    1.  Methodology/Results:
 Charge Question:
Reviewer Comments:
 Is the methodology documented in the report generally
 reasonable and likely to yield accurate results? Is any
 bias likely to be introduced to the results due to
 methodological issues? If so, please indicate the
 direction of this bias and potential remedies.
     Overall, the draft document presents a generally reasonable
     methodology that is likely to yield accurate results.
     The assumptions used for the P2 HEV system are somewhat
     subjective on adding the P2 functionality as an 80/20 power sharing
     between engine and motor for peak conditions.  This may introduce
     a bias in the results of the benefit vs the component cost, or in this
     case incremental costs. The assumption about engine downsizing is
     that the base vehicle and the P2 Hybrid will have equivalent
     performance with increased fuel economy. While peak
     performance is straight forward to assess for both the baseline and
     P2 Hybrid versions, the amount of engine blending,  depth of
     discharge of the batteries, etc will affect the assessed fuel economy.
     It is difficult to assess the direction of the bias (cost or
     performance/F.E. mismatch)- i.e. component sizing is cost sensitive
     and depending on the engine/motor torque blending, component
     cost may be over stated or understated based on blending
     assumptions and equivalence the to the base vehicle.
     There is no simple remedy for this supposed bias since engine
     downsizing and component sizing are subjective based on the
     desired performance attributes to compare the hybrid version to the
     base vehicle. The assumptions made in the report (section A) are
     fair, and clearly stated.
     As with many vehicle simulations, the component scaling
     methodologies need validation.  In some industries, component
     scaling is limited to technology or performance ranges.  For
     instance IGBT transistors versus MOSFET transistors are used for
     two different voltage ranges with some overlap. Even so, the
     scaling assumptions are bounded by the available voltage limit for
     the transistors.  Scaling up power ratings on an inverter, or battery
     voltage have impacts on the scaled inverter costs, caused by (for
     instance) the boundary where one would use MOSFETs for lower
     voltage and IGBTs for high voltage.
 Please identify any general flaws inherent in the scope
 of the study. Do you feel the results would be altered if
 the scope were more limited or expanded? Please
 explain.
     The scope of the document is broad reaching. Expanding the scope
     of the study would likely introduce more variability with increased
     assumption.
     The scope does not need to be reduced since it covers many aspects
     on the cost of producing an automobile and reducing the scope
     would not necessarily increase the validity or accuracy of the study.
 Are all appropriate inputs for the study being
     The scope and breadth of inputs used for the study and cost
                                                           2

-------
considered? Conversely, are all inputs considered in
the study appropriate? Please cite any particular inputs
or assumptions made by the study that you feel are
inappropriate or likely to bias the results and how they
could be remedied, with particular emphasis on sources
of information used in determining labor rates, material
prices, manufacturing burdens and other key factors.
    assessments are broad and apparently all encompassing.   There are
    many input items on costs, such as labor rates and overhead on
    labor, which are outside the expertise of this reviewer. To the best
    of my knowledge, all the inputs used in this study are appropriate.
Are the assumptions embedded in the model that affect
projected cost or performance reasonable? Such
assumptions might include learning curve, economies
of scale, scaling parameters such as weight and power,
labor rates, plant scaling, and material costs.
    Comments in the boxes above discuss some of the bounded areas of
    assumptions that affect cost and/or performance, such as
    engine/motor blending.
    A somewhat contentious point related to assumptions is the
    component rating system for electric machines. There is currently
    no published standard for electric machine rating methods in
    automotive applications. Peak ratings versus average versus steady
    state, as well as inlet cooling rates and losses at different operating
    points are tied up in the assumptions used to compare one  electric
    machine to another after the scaling algorithm.
    The model is very comprehensive, and according to the  reviewer's
    teleconference, the authors of this study validated many of the
    models and component scaling models.
    To the best of this reviewer's knowledge, the assumptions used in
    this study are reasonable. Inputs on materials cost for the  study
    appear to be reasonable to this reviewer.
Are the results expected of the study appropriate for the
given scope, assumptions, and inputs? Are there other
results that could be derived from the analysis that
would support or contradict those cited by the study? Is
appropriate validation made on the costing
methodology and results? Please expand on any
recommendations that you would make for analyses of
study results.
    Yes. The results expected of the study are reasonable given the
    scope, assumptions and inputs.
    The net incremental cost for each of the vehicle sizes and two
    hybrid topologies seems intuitive on cost magnitude, if in fact
    performance is equivalent.
    This reviewer cannot comment on other results that could be
    derived from the study.
    Validation is a very subjective process with regard to the 'level of
    validity'. After reading the study description, and listening to the
    authors during the reviewer's teleconference where the validation
    process was described, it appears that reasonable validation was
    achieved on the costing results.
Is the approach used in scaling the cost of power-split
technology to other vehicle classes appropriate and
likely to yield accurate results? Is the methodology for
using the cost of power-split components in other
hybrid technologies appropriate and likely to yield
accurate results?
•   The approach used in scaling cost of the powersplit technology to
    other vehicle classes appears reasonable and shows no reason that it
    may be not accurate.  The actual numbers placed into the scaling
    routines may be off, and result in turn may be off, but the approach
    is reasonable.
•   The methodology for using power-split component costs in other
    hybrid technologies is reasonably and appropriate since several
    components  are common, but scaled. As mentioned above, there
    are currently no published electric machine rating standards for
    automotive applications. The electric machine in the P2 topology
                                                           3

-------
                                                          has (or likely may have) a different load profile than that used for
                                                          the power-split topology where engine power is split through the
                                                          two electric machines instead of just one in the P2. To that point
                                                          using the normalized cost of the electric machines ($/peak watt)
                                                          from the power-split in the P2 topology is reasonable, but the
                                                          machine rating/sizing may not directly translate. The battery costs
                                                          will be equivalent between the two on peak power/energy, scaled as
                                                          described in the report.
   2.  Editorial content:
Charge Question:
                                                     Reviewer Comments:
Is sufficient detail provided in the body for a reader
familiar with the subject report to understand the
process and conclusions? Are appropriate appendices
included? Please specify any specific content that you
recommended be added or removed.
•   The report is sufficiently detailed for a reader familiar with the
    subject report to understand the process and conclusions.  Each of
    the sections provides a very detailed, pedagogical approach on the
    rationale of systems and subsystem functions, components and
    assessed costs.
•   The tables inserted in the report are, of necessity, very small font
    with many values in a small area making it somewhat difficult to
    read in 8.5" x 11" printed format.  The electronic format was easier
    to read and understand, zooming in on one column at a time.  No
    change is needed for this in the report format, but possibly extracted
    column highlighting significant results would add clarity.  A great
    deal of effort was expended to produce this space efficient report in
    a readable number of pages (sufficient detail without being too
    long.)
•   The appendices are appropriate. The cost model template is
    sufficient for the appendix.
Please comment on any editorial issues that should be
addressed in the report, including any comments on
general organization, pagination, or grammar and
wording.
•   There is a divergence in the electrical engineering world on the
    proper use of the term for electrical distribution 'omnibus'.  The
    classic spelling of the word has only one 's' as in 'bus'.  The other
    spelling is also accepted as  'buss'. There is no direct reference to
    point of divergence since the word 'electrical bus' was first used.
    No action required, just pointing out that there are two accepted
    spellings, the first coming from the origin of the word 'omnibus'.
    The link below shows a survey of the percentage of respondents on
    their preference/where they were educated.
•   http://www.gearslutz.com/board/so-much-gear-so-little-time/15867-
    buss-bus-where-you-learned-3 .html
•   Pagination and grammar in general are very consistent and
    acceptable.

-------
No independent data analysis will be required for this review. Instead, EPA is seeking the reviewer's expert
opinion on the methodologies and cost results of this study, and whether they are likely to yield an accurate
assessment of the true cost of the technology. We ask that each reviewer comment on all aspects of the report.
Please organize all responses according to the charge questions for each of the two categories listed below.
In preparing comments, please distinguish between recommendations for clearly defined improvements that can
be readily made, based on data or literature reasonably available to EPA, and improvements that are more
exploratory or dependent, which would be based on information not readily available to EPA. Comments
should be clear and specific enough to EPA readers or other parties familiar with the report to allow a thorough
understanding of the comment's relevance to material provided  for review.
Additionally, EPA requests that the reviewers not release the peer review materials or their comments until the
Agency makes its report/cost model and supporting documentation public. EPA will notify the reviewers when
this occurs.
If the reviewer has questions about what is required in order to complete this review or needs additional
background material, please contact Susan Elaine at ICF International (SBlaine@icfi.com or 703-225-2471). If
the reviewer has any questions about the EPA peer review process itself, please contact Ms. Ruth Schenk in
EPA's Quality Office, National Vehicle and Fuel Emissions Laboratory (schenk.ruth@epa.gov or 734-214-
4017).

-------
                        Peer Reviewer Report

Preamble
       Accurate calculation of the cost of new technology is very important to EPA since
it needs to relate it to fuel consumption reductions. The recent history of these efforts is
                        19^
summarized in three reports   . Until recently the approach was to ask OEMs and
suppliers the cost of technologies and by taking several samples and probing to create
reasonable estimates of the cost to manufacture.  This approach was taken in reference 1
and also by an NRC Committee to study an "Assessment of Technologies for Improving
Light-Duty Vehicle Fuel Economy"4.
       I was a member of this committee and during our discussions we thought that a
better approach would be to take apart the components of a new technology and analyze
how much each component would cost.  Such an approach would include no only the cost
of labor and materials but all other "manufacturing" costs. Reference 2 and 3 are
examples of such an approach and deal with vehicles with conventional power trains and,
in my view, confirm the accuracy of the process.
       The present report deals with hybrids and my evaluation will deal with the report
as it calculates manufacturing costs.  Of course in evaluating new technology EPA is
charged to estimate not the manufacturing cost but the cost to the consumer to determine
the cost to the consumer.  Traditionally this was done using the so called Retail Price
Equivalent (RPE) factor.  The present report uses a factor called Indirect Cost (1C)
multiplier. Establishing the multiplier is a highly controversial  process and an EPA's
attempt is given in5. The controversy as discussed in reference 4 is that EPA tends to
come up with a small factor and OEM's with a larger one. Also OEMs insist that a
different factor should be used for technologies bought from suppliers and technologies
manufacturer in house. Since the present report does not address this issue, I will limit
my remarks to the estimation of the "manufacturing" costs as described.  However since
the EPA will use this factor in its regulatory process, the end result will likely
underestimate the final cost to the consumer

Detailed comments


Methodology/Results:
Section a. Is the methodology documented in the report generally reasonable and likely
to yield accurate results? Is any bias likely to be introduced to the results due to
methodological issues? If so, please indicate the direction of this bias and potential
remedies.
       The methodology is clearly correct and could lead to correct results. As stated
above, I am familiar with the approach because it was discussed during the NRC
1 EPA420-R-08-008 March 2008
2 EPA-420-R-10-010 April 2010
3 EPA-420-R-09-020 December 2009
4 http://www8.nationalacademies.org/cp/CommitteeView.aspx?key=48843
5 EPA-420-R-09-003 February 2009

Jacovides                           Page 1                           3/24/2011

-------
committee on "Improving the Fuel Economy of LDV" and in the references listed earlier.
The report, under review, represents a superb implementation of the concept.
       The analysis of the Ford Hybrid and cost comparisons with its ICE equivalent is
done very carefully and correctly without any bias that I can detect.  Interestingly the
increase in cost of $3435 that this report comes up with is almost identical to the one we
came up for the Prius in the NRC study of $3385.  We did that by talking to OEM's and
suppliers. However I want to emphasize that the approach taken by this report is far
superior. As long as a detailed design or an actual vehicle is available this is the way to
do it.  It does require a great deal of industrial engineering skill to estimate the amount of
labor, and cost of materials but in the hands of FEV this has produced excellent results.
       It should be pointed out that the methodology is limited to the two architectures
studied viz. split power hybrids as implemented by Toyota and Ford and to a limited
extend on the P2 architecture as implemented by Hyundai.  I say limited since there was
no design available for the electrical machine in this case. The battery for the P2 was
properly analyzed by tear down of an actual unit. Nevertheless the analysis  can be
extended to other hybrids such as the two types made by GM (two mode and the Malibu
ISG) and the Honda Insight

Section b. Please identify any general flaws inherent in the scope of the study. Do you
feel the results would be altered if the scope were more limited or expanded? Please
explain.
       The results of this study cannot properly be evaluated without knowledge of what
EPA considers the 1C factor to be.  I realize that this is not in the scope of the report.
However 1C factors range from 1.02 to 1.45 as stated in reference 5. Industry RPE
factors were estimated in Reference 4 to be 1.5 or 2.0 depending on whether parts were
bought or made in house. One can  calculate manufacturing costs to the penny but then
the end result can vary by a factor of up to two depending on the multiplier
       The results for the P2 may be directionally correct, but I am concerned about the
sizing of the power electronics and  the electrical machine. FEV should have bought a
Honda Insight (IMA), available in the US in the spring of 2010, or a GM Malibu (ISG)
for a tear down of the electrical system (Power electronics and machine). The duty cycle
of the electrical system is very different than that of the power split and so the ratios of
copper to iron to magnets will likely be different. Also it seems from Table F2 that the
electrical machine was sized based  on power. As discussed below torque and duty cycle
are the primary determinants of size and hence cost. It should be pointed out that P2 has
a clutch which provides two features that the Insight and the Malibu do not have.  The
clutch can disconnect the engine so that regenerative braking does not have to be reduced
to provide for engine friction and can provide an all electric range (AER).  The 32.4kW
power of the electrical machine will not provide the required torque and power. There
should be a statement to the effect that the P2 is not designed to provide an AER
       Another problem is the assumption  of a 20% vehicle curb weight reduction for
the P2 architecture and for all vehicle segments. Such a reduction does not come
for free and I found no rationale for this. In reference 4 we found that a 10%
reduction in a 3600 Ibs vehicle would add around $700. During the conference
call it was implied that the P2 electrical  systems is lighter.  This may not be so and
certainly not by 20%.  The speed of the  P2 electrical machine is not an

Jacovides                            Page  2                            3/24/2011

-------
independent variable and it is much lower than the speeds of the two power split
machines.  The size of electrical machines is determined by torque and not power
and so a slower speed machine will be heavier. Clearly getting an Insight or a
Malibu would have given a better estimate.
       Another flaw of the study is that it depends on the ability of the people using the
study to turn the crank for other vehicles or for vehicles without the detail provided by a
teardown.  Clearly FEV has demonstrated that it is developing that knowledge, although I
am not sure about the accuracy of the electrical systems numbers for the P2.  The
question then becomes "will EPA need FEV in the future in order to use this work".
Based on the conference call with EPA, FEV and the Reviewers, this study will not be
used for other architectures so the above point is moot. However I would like to caution
that any extension to other architectures needs to be done by skilled manufacturing
engineers and cost analysts.
Section C. Are all appropriate inputs for the study being considered? Conversely, are all
inputs considered in the study appropriate? Please cite any particular inputs or
assumptions made by the study that you feel are inappropriate or likely to bias the results
and how they could be remedied, with particular emphasis on sources of information used
in determining labor rates, material prices, manufacturing burdens and other key factors.
       When it comes to the main part of the report i.e. the comparison between a hybrid
and an ICE Fusion everything seems to be done very well. Possible exceptions are in
estimating the following costs
  1.   Development of control software.
  2.   Integration of the electrical and mechanical parts.
  3.   Calibration. Hybrid vehicles are more complex and to make performance
       transparent to the driver is expensive.  Safety also requires extensive calibration.
       Toyota has recalled the 2010 Prius to fix software when braking on ice on bumpy
       roads. If this can happen to Toyota with 10 years experience on hybrids, it must
       be taken seriously.
These are upfront engineering costs and by the time production volume has reached 450k
units may not be significant. However they need to be added to the cost of the vehicle.

Section d.  Are the assumptions embedded in the model that affect projected cost or
performance reasonable? Such assumptions might include learning curve, economies of
scale, scaling parameters such as  weight and power, labor rates, plant scaling, and
material costs.
       These seem to me to be appropriate. A problem will arise with the next person
who runs the model.  Will they have the expertise of FEV, which I think is one of the
premier automotive engineering firms?

Section e. Are the results expected of the study appropriate for the given scope,
assumptions, and inputs? Are there other results that could be derived from the analysis
that would support or contradict those cited by the study? Is appropriate validation made
on the costing methodology and results? Please expand on any recommendations that you
would make for analyses of study results.

Jacovides                           Page 3                            3/24/2011

-------
       The results are reasonable, not only because the actual number is the same as we
got in our study but because the costs are estimated with great detail.  I am aware of one
other company that has used this approach to come up with detailed costs of automotive
components6. However I am not aware of any similar results for hybrids.
       I realize that you cannot publish confidential information that you obtain from
OEM's, but I think it would be useful to show the results to Ford and Toyota before
making the report public.  They are much more likely to find errors than the review panel
and it may prevent any arguments after the report is made public. I understand that this a
policy matter, but getting their input seems reasonable to me

Section f. Is the approach used in scaling the cost of power-split technology to other
vehicle classes appropriate and likely to yield accurate results?, Is the methodology for
using the cost of power-split components in other hybrid technologies appropriate and
likely to yield accurate results?
       Scaling for a vehicle with identical architecture but with higher power is not as
simple as it appears. Results are given on page 132 (pdf)7 for the HVAC system where
the fixed cost of the electronics is, correctly, taken out. However the compressor cost
appears to be scaled as the power. This is not correct since the material may indeed be
scaled as the power but the labor is not.
       Similarly the cost of the electrical machines should not be scaled as power. As
stated above scaling for the P2 should be made on  the basis of torque and duty cycle.  I
understand that two designs were made for a 30kW generator and for a 60kW motor. It
was said during the conference call that using these designs the data were extrapolated for
different size vehicle. This can only be done if the motor and generator have identical
torque and duty cycle profiles. This is highly unlikely and so someone with electrical
machine design experience needs to develop parametric results for the motor and
generator separately.  Also as stated above one cannot use power for scaling a slow speed
machine used for the P2
       The NiMH battery scaling is done correctly. A possible weakness is that as an
alternative to reducing the number of cells to estimate a smaller system, one may choose
to use a larger number of smaller cells.  Regarding the electrical machines and the
compressor I suggest that a separate small study be undertaken to determine the scaling
factor. I suspect it will be between two extremes, .a) scale as power and b) scale material
as power and leave labor and overhead the same. Things get even more complex if a
different architecture is used. The approach used here for the P2 architecture is
directionally correct but the results will not  have the accuracy that the Ford Fusion
comparison has with its ICE counterpart.
       The treatment of the Li-ion battery (LIB) raises a number of questions
          1. What is the available energy? Typically the SOC variation is limited in
             order to obtain life. For hybrids like the Prius the swing is from about
             50% to 60%. TheGM Volt battery swing is 30 to 80%.  Scaling the LIB
             to the same nominal kWh assumes that the life of the LIB will be
             comparable.  Some discussion is needed that the life will not be
6 Intellicosting LLC, 980 Chicago Road, Troy, MI 48083-4226
7 Page numbers refer to the pdf not the pages in the report

Jacovides                            Page 4                            3/24/2011

-------
             compromised
             It is not clear what size battery is costed for the P2. Page 126 (pdf) states
             that the battery from the Avante is 0.954 kWh and this battery was costed
             on table D13 at $1399. Increasing the energy by 270/180 and scaling the
             costs as energy the P2 battery should cost $2098. Please explain whether
             the cost of the P2 battery is $1399, $1798 or $2098. To add to my
             confusion table F2 shows a battery of 0.9117 kWh for the mid large
             (Fusion size vehicle). Also table A4 shows $1690.43 for the High Voltage
             Traction Battery Subsystem. I am sure I am missing something but it
             needs to be clarified for the reader
             The estimated cost of the cells given in D-13 for a 0.954 kWh battery of
             $1020 seems reasonable at roughly 1000 $/kWh
Editorial content:

Section a Is sufficient detail provided in the body for a reader familiar with the subject
report to understand the process and conclusions? Are appropriate appendices included?
Please specify any specific content that you recommended be added or removed.
      I would like to see a clear definition of what is assumed to be the Indirect cost
(1C). Is  everything not included in Step 7 MAQS on page 21 assumed to be covered by
1C? I realize that assigning an 1C factor is beyond the scope of this report but it should be
made clear what is included. Also it should be made clear that no allowance was made
for a different 1C factor for parts sold by suppliers and made by the OEM's.
      A minor editorial  point deals with Page 10 figure Al. I would clarify the
planetary gear set by showing ring, planets and sun clearly. Also remove the gap
between the differential to show that the two gears mesh. Further label the output of the
differential as going to vehicle wheels not coming from the wheels
      Page 9 makes a good point up front  ...based on  current automotive  and/or
surrogate industry manufacturing  operations and processes,  it is
acknowledged  that a reduction to  the costs presented is  very likely
based on both product and manufacturing learning. Projected technology
cost  reductions,  as a result of learning, are not covered as part  of
this  analysis.
      Page 21.Item #8,  Market Place Crosscheck, is  a good idea but needs further
explanation and the report should show results.  Comparison with FEV in house experts
seems less than satisfactory.
      Page 37 uses labor rates from BLS. Since lithium ion batteries are not made in
the US it would be good to say what labor rate was used for the Li-ion battery.  Some of
the operations need to be made in low grade clean room
      I would be interested to find out how the electrical  machines are cooled for the
split power.  Oil cooling is used for the P2 and coolant fluid is used for the power
electronics but I doubt that coolant was used for direct cooling of the motor and
generators

Section b. Please comment on any editorial issues that should be addressed in  the


Jacovides                           Page 5                            3/24/2011

-------
report, including any comments on general organization, pagination, or grammar and
wording.
No comments- everything seems very well done

Section C. In preparing comments, please distinguish between recommendations for
clearly defined improvements that can be readily made, based on data or literature
reasonably available to EPA, and improvements that are more exploratory or dependent,
which would be based on information not readily available to EPA. Comments should be
clear and detailed enough to EPA readers or other parties familiar with the report to allow
a thorough understanding of the comment's relevance to material provided for review.

Suggestions for next steps
Here are some unsolicited improvements and possible next steps:
   1.  As discussed above under f) have small study made on how to scale electrical
      machines and the compressor to distinguish between scalable and fixed costs.
   2.  It would be good to check with Ford as to the accuracy of the results. Although
      their volume is not up to 450k they should be able to give you an estimate.  For
      comparing the P2 costs check with Honda or GM, which produce similar
      architectures although, without a clutch between the engine and transmission.
      More problematic will be a check with the GM on their two mode hybrids.  They
      have higher power and one additional gear, but they seem to be much more
      expensive.  As I said earlier the numbers check with the Prius that we studied, but
      we were puzzled by the GM figures. Although the Fusion is bigger the Prius data
      are a couple of years old and Toyota had not reached the 450k volume.
   3.  I would use the scaling exercise for the Volt and the Leaf.  These are much
      different vehicles but have components that have been included in this study.
      Then check with GM and Nissan on costs.
Respectfully submitted
Linos J. Jacovides
Director of the Delphi Research Labs (Retired)
154 TouraineRd
Grosse Pointe Farms
Michigan  48236
Jacovides                           Page  6                            3/24/2011

-------
       U. S. Environmental Protection Agency (EPA) Peer Review

                 Draft Report: FEV07-069-303F Dated 2/22/2011
        Title: Light-Duty Technology Cost Analysis Power-split and P2 HEV
                                Case Studies

Reviewer: Linda M. Miller
Review Date: March 14, 2011

To facilitate use of this review, I will first provide some general observations and
recommendations.  More detail will be provided in the sections of this review that
are organized in alignment with the topics and questions in the Peer Review Charge.

General Observations:
   •   It is clear that a great deal of detail and effort has gone into FEV's analysis
      and preparation of the report.

   •   The use of vehicle/component teardowns is an integral part of the analysis
      and recognized by the industry as an excellent means of cost analysis.
      Likewise, the development of detailed process flow charts used in the detailed
      costing is a well accepted practice.

   •   The report analysis relies heavily on a number of data bases and models that
      are necessarily quite complex. However, validity testing of the Munro &
      Associates software which is fundamental to the development of the cost
      estimates is not documented. Additionally, tests that have been performed to
      validate the FEV data bases  and the costing algorithms are not included.

   Recommendation: Since these data bases are integral to the study, include the
   detailed methodology, including worked examples, used to validate these data
   bases. Hypothesis testing of assumptions concerning burden rates, product
   maturity, etc. and sensitivity analysis to demonstrate correlation to actual
   component costs should be a part of the study. It is recognized that providing all
   the supporting detail in a paper of this magnitude would be excessive. However,
   a link to the data could be included similar to the one for OTAQ documents (page
   126).  If the data is considered proprietary, then examples tracing both a simple
   and a complex component/assembly through the process demonstrating how the
   various costs were derived should be included in an Appendix or as a separate
   document.

   •   The process for defining and apportioning manufacturing burden costs such
      as front office salaries down to a single machine on the plant floor is
      questionable.

   Recommendation: It would be more acceptable to apply the developed burden
   rates at a manufacturing process/component level.

-------
Comments by Charge Question:

   1.  Methodology/Results
Question:
Is the methodology documented in the report generally reasonable and likely to
yield accurate results? Is any bias likely to be introduced to the results due to
methodological issues? If so, please indicate the direction of this bias and potential
remedies.

Response:
   •   While the methodologies, for the most part, appear reasonable, there are
      some areas of concern.
        o There is a lack of documentation in the paper proving that the
           methodologies yield accurate results. While the paper references
           marketplace validation, no examples are given.

              Recommendation: Include examples taking developed costs for
              items such as fuel injector assemblies(Figure C-3, page 45, Sample
              MAQS Costing Worksheet); extrapolating these to a total cost using
             the approach outlined in the paper; and then comparing these costs
             to actual marketplace pricing for the example used.  One or two
             worked examples of this nature would help to validate the overall
              methodology. Alternatively, include a table, detailed by component/
             sub-assembly, showing the methodologies and comparisons used
             for costing each item.

        o The costing methodology, as presented, develops costs that are
           absolute. Given the complex nature of the end product and the
           manufacturing processes, it would have been appropriate to include
           sensitivity analysis in the costing detail. If sensitivity analysis has been
           performed on a sampling of costs, it is not shown in the paper.

              Recommendation: Assuming sensitivity analysis is available, show
             the impact of sensitivity analysis in the examples in the paper. If
             sensitivity analysis has not been performed, then this is an area of
             detail that needs to be completed. From a manufacturing
              perspective,  sensitivity analysis on high dollar components needs to
              include scrap rates, mean time to repair of equipment, equipment
              uptime, etc.

        o The scaling methodology appears to be overly simplified.  For example,
           scaling factors are applied to labor and manufacturing overhead. The
           cost of direct labor is more a factor of part complexity than one of size.
           Also, certain elements of overhead cost such as salaries and front
           office costs are not impacted, or at most minimally, by part size.

-------
              Recommendation: A deeper review of the approach to scaling
              needs to be undertaken to insure that costs are not under/over-
              stated. Again, applying sensitivity tests may help determine whether
              or not these differences are significant.

   Without the documentation noted above, it is not possible to say whether or not
   bias has been created.

Question:
Please identify any general flaws inherent in the scope of the study. Do you feel the
results would be altered if the scope were more limited or expanded? Please
explain.

Response:
I do not see any general flaws inherent in the scope of the study. Extrapolation to
other vehicle sizes could not be done without the basic underlying detailed studies.
However, once the component costs had been developed for the Fusion, the
justification for the extensive  use of scaling factors to approximate these costs for
other vehicle lines does not have the same level of detail as the rest of the study.
Whether or not this has been  impacted by the scope of the project can not be
determined.

  Recommendation: Review the application of scaling factors, especially for
manufacturing cost and burden. The methodology described in the paper yields a
result that should be considered as one end of a range estimate. The other end of
the estimate should be developed by applying scaling factors to material cost and
investment in equipment and  holding the other costs constant.  If it is necessary to
state an absolute cost, the pick a middle ground between these two numbers based
on expert opinion.

Question:
Are all appropriate inputs for the study being considered? Conversely, are all inputs
considered in the study appropriate? Please cite any particular inputs or
assumptions made by the study that you feel are inappropriate or likely to bias the
results and how they could be remedied, with particular emphasis on sources of
information used in determining labor rates, material prices, manufacturing burdens
and other key factors.

Response:
Although, as explained in the  conference call on March 8, 2011, it is EPA policy to
perform studies of this nature independent of the OEM's, it would have seemed
appropriate to seek validation of the teardown costing from the manufacturer whose
vehicle is the basis for this analysis. For a review of other assumptions that are of
concern, see the response to the next Question.

-------
Question:
Are the assumptions embedded in the model that affect projected cost or
performance reasonable? Such assumptions might include learning curve,
economies of scale, scaling parameters such as weight and power, labor rates,
plant scaling, and material costs.

Response:
While the majority of assumptions cited in the study are valid, there are a number of
assumptions that need to be re-considered. They are as follows:
   • The technologies used are considered to be mature. It is more likely that the
     technology will continue to evolve requiring changes to manufacturing
     facilities and tooling. The assumption of maturity, for example, impacts a
     number of underlying cost elements and other assumptions: there are
     assumed to be no allowances for product/manufacturing learning, scrap rates
     are minimal, non-recovered E,D&T expense and capital costs are zero, and
     there are no allowances for equipment end of life costs.  All of these stem
     from the assumption of maturity. At the same time, however, it is assumed that
     no new or modified equipment maintenance is  required (See pages 16 & 17).
     This is not consistent with equipment at the end of its life cycle. All of the
     above will cause cost estimates to be understated.

   Recommendation: Review the costs impacted by the assumption of maturity.
   Uplift costs by a percentage factor where appropriate.  If the assumption
   remains that equipment will be at the end  of its useful life, then increase
   maintenance costs over time according to the equipment OEM's guidelines.

   • It is assumed that "integration of new technology would be planned and
     phased in to minimize non-recoverable expenses". This would indeed be the
     most cost effective decision.  However, given the significant requirements for
     fuel economy improvements and emissions reductions, the need to implement
     new technology will likely be the over-riding consideration.

   Recommendation: Perform cost sensitivity analyses with non-recovered E,D&T
   and stranded capital in percent increments ranging from 10 to 30 %. Include the
   results in the paper.

   • End-item scrap includes quality defects, rework costs, and/or destructive test
     parts (page 29).  The general mark-up varies from 0.3% to 0.7% depending on
     part complexity and size (page40, Table C-1). However, it is stated that
     exceptions are made depending on the part. Examples cited in Section
     C.4.5.2 include sand and investment casting. These are considered to be
     "generic" processes and the end-item scrap mark-up is uplifted to 5% in both
     cases. However, just as in Table C-1, this rate needs to vary dependent upon
     the part size and part complexity (I am assuming tolerance limits are
     considered part of part complexity.  If not, tolerances need to be considered
     as another factor in determining scrap rates.)  Without a part by part review of
     the assumptions, the impact to the cost analysis can not be determined.

-------
 Recommendation: To test the reasonableness of the scrap percentages, check
 a random sample of components and compare the end-item scrap rates for
 those processes to industry standards. Use complexity and size of the parts to
 adjust averaged rates.

•  All sourcing/manufacturing centers are assumed to be in the United States.
   As discussed in the March 8, 2011 conference call, this is not a valid
   assumption and can significantly impact cost either negatively or positively.

Recommendation: Review present sourcing patterns, at least for the high cost
components and sub-assemblies, and utilize these patterns as the basis for the
cost analysis.

•  Labor Rates MAQS Costing Worksheet Example (page 46).  It can not be
   determined whether or not any overtime costs were assumed in the labor
   cost/hour calculation. Overtime costs will vary manufacturer to manufacturer
   based on Union agreements and/or operating practices.  However, in a
   number of cases (Ford Motor Company for one), shifts of 10 hours per day in
   the United States would generally include 2 hours of overtime pay. Afternoon
   shift also has an associated premium cost.

 Recommendation: Verify underlying assumptions in the labor rate models.

•  Packaging Assumptions: Based on the sample calculation (page 50, Figure C-
   6), allowances for a percentage of pallets/racks out for cleaning and/or  repair
   (generally around 5%) have not been included. This understates the
   packaging cost.

Recommendation: Increase the # of packaging units required by 5% where
returnable packaging is used.

•  Cost of Complexity Assumptions:  Based on the volume assumption of 450K
   per year, although it is not stated in the report, it is assumed that the major
   complex assemblies: Engine and Transmission as well as Complex
   Subsystems are produced on dedicated lines. If not, then a cost of complexity
   factor needs to be added. The 75% combined utilization/efficiency
   assumption (calculated based on page 37) is reasonable. However, if hybrid
   components are assembled on the same lines as the baseline products, then
   this  utilization/efficiency is  over-stated due to the inherent inefficiencies
   caused by manufacturing complexity. Note: It should be assumed that hybrid
   and  base vehicles will be assembled on the same line and so this added
   complexity must be factored into the utilization/efficiency calculation.

Recommendation: Process flow diagrams for complex base-line vehicle
assemblies/components should be compared to those developed for HEV vehicle

-------
   and adjustments made to the efficiency/utilization percents for HEV based on this
   comparison.

   •   System Scaling Cost Analysis: While the use of ratios to develop sizing for
      HEV components such as traction motors, high traction batteries, etc. is
      appropriate and can be used to estimate material costs, the use of these
      ratios to determine other factors within manufacturing cost such as labor
      (page 126) is less valid. Part complexity influences these costs more than
      part size. The same concerns exist with establishing component costs for P2
      HEV powertrain components using manufacturing cost to component size
      ratios (page 127).

    Recommendations:
   •   Re-evaluate the assumptions around use of a scaling factor to better define
      those costs which are scalable and those which are not.

   •   Assuming the validity of the approach to costing using manufacturing cost to
      component size ratios, provide background data supporting this assumption.

   •   As outlined above, review the application of scaling factors, especially for
      manufacturing cost and burden. The methodology described in the paper
      yields a result that should be considered as one end of a range estimate.  The
      other end of the estimate should be developed by applying scaling factors to
      material cost and investment in equipment and holding  the other costs
      constant. If it is necessary to state an absolute cost, the pick a middle ground
      between these two numbers based on expert opinion.


Question:  Are the results expected of the study appropriate for the given scope,
assumptions, and inputs? Are there other results that could be derived from the
analysis that would support or contradict those cited by the study? Is appropriate
validation made on the costing methodology and results? Please expand on any
recommendations that you would make for analyses of study results

Response:  At best, the levels of assumptions that are made in a study of this
magnitude provide costs that are directionally correct.  During the conference call
on March 8, 2011, it was stated that the study commissioned was for absolute costs
as opposed to range estimates. However, this gives the study results more
credence than the assumptions can support.  It was also stated, in the same
conference call, that a manufacturer had been asked to provide costs for one
component and that the cost differential to that developed in this study was 5%.
This further supports  the concern with reporting the cost results of the analysis as
absolutes.
Concerns regarding validation have been stated consistently  throughout this
review. Teardown analysis, development of process flow diagrams, analysis of
comparable parts where available, etc., are excellent methodologies. However, a
number of assumptions have gone into the methodology  used to develop the

-------
manufacturing costs from these process flow diagrams and the validation of these
assumptions are not documented in this paper. Of particular concern are the
assumptions around sourcing (directed by the EPA), product maturity, development
of burden rates by piece of equipment, direct labor cost calculations and the
application of component size ratios as the primary scaling factor for manufacturing
cost in other vehicle applications.

 Recommendations:
   •  For those components/ assemblies which most impact vehicle cost, provide
      range estimates.  Without looking at more detail, a proposal for these ranges
      can not be made.  However, the cost developers for this study should be able
      to provide such ranges as are appropriate based on sensitivity testing.

   •  Where components are most likely to be sourced outside the United States,
      costs need to be adjusted for sourcing pattern. The sourcing pattern may be
      a cost reduction or cost increase dependent upon a number of factors.

   •  In the direct labor calculation of the mean manufacturing labor wage for a
      component or assembly (page 32), it is unclear whether or not the various
      labor wage rates are weighted by the calculated number of employees in that
      classification to obtain a weighted average. If this has not been done, direct
      labor costs need to be re-evaluated. There are significant wage differentials
      between the various classifications with general assembler being the lowest
      paid. (The same applies to the indirect labor costs.)

Question:  Is the approach used in scaling the cost of power-split technology to
other vehicle classes appropriate and likely to yield accurate results? Is the
methodology for using the cost of power-split components in other hybrid
technologies appropriate and likely to yield accurate results?

Response:
   •  The use of ratios to develop sizing for HEV components such as traction
      motors, high traction batteries, etc. as described in the paper is appropriate
      and can be used effectively to estimate material costs and investment in
      equipment.

   •  Concerns with using the size ratio scaling methodology for certain other cost
      estimates is documented in other sections of the response. For convenience,
      they are repeated here:
        o  Certain elements of overhead cost such as salaries and front office
           costs are not impacted, or at most minimally, by part size.

        o  Direct labor costs are more closely tied to part complexity than to part
           size.

-------
        o  While part size will impact certain areas of indirect labor, such as
           material handlers, it will have a lesser impact on number of supervisors,
           quality inspectors, etc. Like direct labor, these numbers are more
           closely tied topart complexity than size.

        o  The same concerns exist with establishing component costs for the P2
           HEV powertrain components using manufacturing cost to component
           size ratios (page 127).

   •  The issues addressed above regarding scaling methodology apply equally to
     the P2 manufacturing cost calculations.

 Recommendations:
   •  Re-evaluate the assumptions around use of a scaling factor to better define
     those costs which are scalable and those which  are not.

   •  Assuming the validity of the approach to costing using manufacturing cost to
     component size ratios, provide background data supporting this assumption.

   •  As outlined above, review the application of scaling factors, especially for
     manufacturing cost and burden. The methodology described in the paper
     yields a result that should be considered as one  end of a range estimate. The
     other end of the estimate should be developed by applying scaling factors to
     material cost and investment in equipment and holding the other costs
     constant. If it is necessary to state an absolute cost, the pick a middle ground
     between these two numbers based on expert opinion.


   2. Editorial Content

Question: Is sufficient detail provided in the body for a reader familiar with the
subject report to understand the process and conclusions? Are appropriate
appendices included? Please specify any specific content that you recommended
be added or removed.

 Response: Although a substantial amount of detail is included, there are a number
of things that should be added to the report to substantiate the process and
conclusions. As outlined in a number of questions above, these details are
necessary to validate the processes and underlying assumptions used to arrive at
the cost conclusions. These details include:
   •  Validation of the Munro & Associates software including methodology and
     results
   •  Validation and sensitivity testing (or results of the testing) of the FEV cost
     algorithms
   •  Specific examples where validation testing has been done through
     marketplace analysis. These examples must show the FEV derived cost and
     the actual marketplace cost.

-------
   •  A worked example showing the detail behind each number in the MAQS
     costing sheet.
   •  Sensitivity analysis for a sampling of the components and assemblies in the
     cost analysis.
   •  Data supporting the assumption that manufacturing costs can be calculated
     as a ratio of component size.
   •  Clarification of the calculations for direct labor cost.
With the exception of the last item, all of the appropriate documentation should be
provided as appendices or as links to other papers/detailed analytical data.

Question: Please comment on any editorial issues that should be addressed in the
report, including any comments on general organization, pagination, or grammar
and wording.

Response: The general organization of the paper is clear. The following are areas
where typographical errors or other editorial issues exist:

   •  Page 16—Item 2 net to the last line.  "Develop" should read "Development"
   •  Page 35—next to the last paragraph references a template in Appendix E.4.
     This Appendix could not be found in my copy of the paper. This may just be a
     labeling error, but none of the pages in the appendix appeared to be the
     template referenced.
   •  Page 42—Next to the last paragraph, 2cnd sentence. FOB (freight on board)
     is usually designated as FOB, destination—supplier pays the shipping costs or
     FOB Factory—customer takes control of the product and  pays the shipping
     cost.  Note that in Europe, FOB is always referred to as "Free on Board".
     Assuming you mean the receiving company pays the freight, the more
     common term would be FOB Factory.

This concludes my review.

Respectfully submitted,

Linda M. Miller

-------
 Review of Draft Report "Light Duty Technology Cost Analysis, Power Split
             and P2 HEV Case Studies, dated March 10th, 2011"
                                    By
                            Deepa Ramaswamy, Ph.D.,
                           Hybrid Chakra Consulting, LLC
This report contains the review of the draft report  listed above.  It
begins with a response to the specific charge questions  from ICF.  The  first
part of the report contains responses to the charge  questions,  and these
are listed in Table 1 and Table 2. The next part of  the  report  lists
additional review comments in certain specific categories.

In general, FEV and Munro are to be commended for the  detail that  they have
shown in this approach to determining hybrid system  cost.  The use  of linked
MAQS worksheets that allow the component costs to be rolled up  to  subsystem
and system costs is a powerful tool,  that can be used  to do sensitivity
analysis further down the line. However,  the best system is only as good  as
the inputs/assumptions that drive it. Some of the assumptions used in  this
report(e.g. battery technology and size,  manufacturing location, system
power)that are key in determining overall system cost   have to  be  carefully
thought through and considered during future rulemaking  by the  EPA.
Methodology/Results:
     Charge  Question:
      Reviewer Comments:
     Is  the methodology
     documented  in  the report
     generally reasonable and
     likely to yield accurate
     results? Is  any bias likely
     to  be introduced to the
     results due  to
     methodological issues? If
     so, please  indicate the
     direction of this bias and
     potential remedies.
      The methodology for determining the costs
      are generally reasonable,  with some
      significant exceptions that are listed
      below.
         •  The first is the engineering
           development cost, which appears to
           have been not considered in detail
           in this report. An example of these
           are the costs to develop control
           systems, be they battery control
           systems or otherwise. They cannot be
           lumped in with the indirect cost
           multipliers  (ICMs),  because these
           costs are not borne by the OEMs.
           Rather, these are costs borne by the
           suppliers. The bias introduced by
           this is that the overall cost of
           some components is lower than it
           should be. The remedy for this is to
           revisit the engineering development
           costs for the subsystems.
         •  What this report does not document
           sufficiently is the validation of
      	this methodology at a subsystem or a
Date: March 11,  2011
Page 1 of 7

-------
                                      system level. The bottoms up towards
                                      cost that is employed by FEV is
                                      certainly very detail oriented, but
                                      there isn't sufficient data in the
                                      report to show that the final
                                      subsystem or system costs that they
                                      result in, are inline with those
                                      developed or published by other
                                      reasonable sources.
     Please  identify any general
     flaws inherent in the  scope
     of  the  study. Do you feel
     the  results would be
     altered if the scope were
     more limited or expanded?
     Please  explain.
           Although not a flaw per se, it is
           not clear why the 20% power and
           weight reduction was assumed for the
           P2 hybrid. This was the direction
           provided by the EPA to FEV, but the
           rationale for this is not clear, and
           this reviewer could not see why it
           is justified.
           Secondly, the reports stated that
           the team felt that the Li Polymer
           battery  (as opposed to NiMH) is a
           better long term solution for the P2
           hybrid. It's unclear if this was the
           EPA team or the FEV team. Either
           way, there is no good rationale
           provided for such a statement, and
           this reviewer has not seen data
           (even outside of this report)  to
           justify such a statement.	
    Are  all  appropriate  inputs
    for  the  study being
    considered? Conversely, are
    all  inputs considered  in
    the  study appropriate?
    Please cite any particular
    inputs or assumptions  made
    by the study that you  feel
    are  inappropriate or likely
    to bias  the results  and how
    they could be remedied,
    with particular emphasis on
    sources  of information used
    in determining labor rates,
    material prices,
    manufacturing burdens  and
    other key factors.
           One of the major assumptions in this
           study that is flawed is that the
           high voltage battery will be
           manufactured in the United States.
           NiMH batteries are not manufactured
           in volume in the United States, and
           although several companies have
           plans to manufacture Li Ion
           batteries, the cells typically come
           from Asia. To assume that all this
           manufacturing is done in the US will
           results in artificially high unit
           costs for these systems. If this
           information is then used by the EPA
           for downstream rule making, it will
           have the effect of having hybrid
           technologies show up in an
           unfavorable light as compared to
           other technologies. This inaccuracy
           could be remedied by a modification
           of the assumptions in terms of where
           the battery will be manufactured.
           This study does not present
           sufficient examples of independently
           determined system/subsystem costs to
           be used for validation of the costs
           that FEV/Munro calculates through
           their process. Although the report
           mentions this was done  (section
Date:  March 11,  2011
Page 2 of 7

-------
                                      C.I), examples of such validation
                                      are not presented. These
                                      independently determined
                                      costs/sources should be additional
                                      inputs to this process.
    Are  the  assumptions
    embedded in  the model that
    affect projected cost or
    performance  reasonable?
    Such assumptions might
    include  learning curve,
    economies of scale,  scaling
    parameters such as weight
    and  power, labor rates,
    plant scaling, and material
    costs.
         •  In general, the assumptions that are
           utilized to calculate  cost and
           performance are reasonable. One big
           exception  (also mentioned in
           question 6 below)  is the scaling
           parameter for the battery. Only two
           paragraphs are devoted to it in the
           report, and nowhere is a definition
           of "a common run-time", which is
           used  in the scaling of the battery,
           provided.
    Are  the  results expected of
    the  study  appropriate  for
    the  given  scope,
    assumptions,  and  inputs?
    Are  there  other results
    that  could be derived  from
    the  analysis  that would
    support  or contradict  those
    cited by the  study?  Is
    appropriate validation made
    on the costing methodology
    and  results?  Please  expand
    on any recommendations that
    you  would  make for analyses
    of study results.
         •  The results of the study are
           appropriate for the given scope,
           assumptions and inputs.
         •  The description/report of the
           validation of the costing methodolgy
           is not sufficient. The report does
           say that experts have been consulted
           in determining the costs of various
           components, but little validation
           has been shown  (in the report) of
           cost validation at a subsystem or
           system level. The overall costs
           developed by FEV would present a
           greater punch if there were examples
           of the comparison of their
           system/subsystem costs with other
           costs that have been published in
           literature.
         •  FEV and Munro have the tools
           necessary to do a sensitivity
           analyses of the costs with respect
           to different variables of interest.
           Further analyses could include
           refinement/correction of some of the
           assumptions around this study  (as
           mentioned in this review)  and
           studying how the overall system
           costs are impacted by those changes.
     Is  the  approach used  in
     scaling the  cost of power-
     split technology to other
     vehicle classes appropriate
     and likely to  yield
     accurate  results?  Is  the
     methodology  for using the
     cost of power-split
     components in  other hybrid
     technologies appropriate
           For most of the components, the
           approach used in scaling the cost of
           power split technology to other
           vehicle classes is reasonable and
           likely to yield reasonable results.
           The one potential exception (and it
           is stated as potential, because the
           approach is not well explained in
           the report) is the scaling of the
           high voltage battery parameters	
Date:  March 11,  2011
Page 3 of 7

-------
     and  likely  to  yield
     accurate  results?
           across the the different vehicle
           classes. This needs to be better
           explained and justified,
           particularly because this one
           component is responsible for the
           bulk of the cost of the hybrid
           powertrain. Given that the overall
           cost of the hybrid powertrain is  so
           sensitive to this one component,
           this reviewer feels that greater
           care is needed in developing this
           cost. Conversely, there is
           considerable detail in the report on
           the costs for much more minor
           components, and although that is  not
           a bad thing, the appropriate scaling
           of the battery system needs to have
           more effort put into it.
                  Table 1 Charge Questions - Methodology/Results
Editorial content:
 Charge Question:
      Reviewer Comments:
 Is sufficient detail provided
 in the body for a reader
 familiar with the subject
 report to understand the
 process and conclusions? Are
 appropriate appendices
 included? Please specify any
 specific content that you
 recommended be added or
 removed.
      In most cases, sufficient detail has been
      provided for a reader familiar with the
      subject report to understand the process
      and conclusions. Exceptions are:
         •  Rationale for assuming the high
           voltage battery is manufactured in
           the United States
         •  Development of the ED&T costs for
           different subsystems, particularly
           that for control systems
         •  Validation of the calculated costs
           at a subsystem/system level
         •  Scaling of the battery system across
           different vehicle classes
         •  Cost for the high voltage DC/DC
           converter doesn't appear to be
           included
 Please comment on any editorial
 issues that should be addressed
 in the report,  including any
 comments on general
 organization,  pagination,  or
 grammar and wording.	
      The overall report is well organized.
      There are a few minor
      typographical/grammatical  issues. These
      are included in detail in section
      "Grammatical/Typographical Errors".
                   Table 2 Charge Questions - Editorial Content
Date: March 11, 2011
Page 4 of 7

-------
                       Additional Review Comments
The following sections provide additional review comments  on  the  FEV
report.

Battery Manufacturing
The report assumes that the battery will  be  manufactured  in locations  in
North America. Although this reviewer understands this  to  be  a  constraint
from the EPA, this is not a reasonable assumption.  There  is no  large scale
automotive NiMH manufacturing in North America currently  and  there  are  few
plans for the same.  Although there  are more  examples of Li Ion  battery
manufacturing in North America,  it  is questionable  if Li  Ion  will be the
battery of choice for hybrid vehicles. In this reviewer's
experience/knowledge, the NiMH battery will  continue to dominate  the HEV
market,  while Li Ion will dominate  the PHEV/EV market.



Applicability of the Power Split System to Vehicle Segments
The report talks about the applicability  of  the power split hybrid  system
to the sub-compact,  small, large and minivan vehicle segments.  It should be
clarified that this  group covers small SUVs,  such as the  Ford Hybrid
Escape,  which is one platform that  clearly already  supports this  hybrid
platform.


P2 Hybrid System
   1. Although the EPA provided the  direction to reduce  the maximum  system
     torque/power by 18-19%, the rationale for this isn't  clear.  Without
     this rationale, a meaningful comparison between the  cost figures  for
     the power split system and those for the P2 system cannot  be made.
   2. Why was it felt that the Li Ion battery would  be more appropriate  for
     the P2 hybrid?  Li Ion batteries have much better energy  density than
     NiMH batteries, so for applications  that require large battery energy
     (such as PHEVs  or EVs), it is  understandable to use  Li Ion packs.
     However, for the P2 application,  the required  kWH  of  the battery  (from
     Table F-2)  was  less than that  for the power split  application  (from
     Table E-2).  Given this, the selection of the Li Ion  technology for the
     P2  system is not well justified.


Cost Analysis Process
   1. In Figure B-l,  why isn't the BOM updated after step  6, when  additional
     information has been gained about the component after its  disassembly?
   2. Page 50, first  paragraph refers to 19,149 parts, and  it  wasn't clear
     what the 19,149 parts stand for? Are these 19,149  battery  packs?
   3. It  isn't too clear how the engineering  design  costs  for  various
     components/systems have been calculated.
       a. For example, in section D.2.2,  how has the engineering  design
          cost for the Atkinson engine and the control  system for it,  and
          the calibration for it been calculated/estimated?
       b. Similarly, how is the engineering  design  cost for the electronics
          controllers, for the software for  the battery system, for the
          mechanical design of the  battery system been  estimated? The
          actual numbers that have  been presented in the  tables appear  to
          be too low.

Date: March 11,  2011       Page 5 of 7

-------
        c. In Table D-ll,  why is the ED&T for the traction battery assembly
          so high ($49)  compared to that for the control module (listed as
          $4)? The relative engineering effort for the control module is
          not 12 times less than that for the design of the mechanical
          assembly.

System Scaling and Sizing
   1. Although the scaling for the most of the components across the
     different vehicle classes seems reasonable, one big item that is not
     explained clearly is the high voltage battery.  Given that it is the
     single most expensive subsystem within the hybrid powertrain, more
     care needs to be put into ensuring that this is done in a reasonable
     manner, and the report needs to explain how this was done. The last
     paragraph on page 132 talks about the "common run-time" parameter that
     is used to scale the battery system across vehicle segments.  This
     parameter needs to be defined, and the report should have more of an
     explanation why the value of 0.0168 hours was used, and how it
     translates to the other parameters (power rating, energy rating)  that
     define a battery.
   2. In Table E-2, the nominal pack voltage for the subcompact passenger
     vehicle is quite low, namely 148V. Could other, potentially cheaper
     power electronics technologies be used at this battery voltage?
   3. There is a small discrepancy between some of the numbers in Table E-2
     as compared to those in Table D-3. For example, for the Fusion Hybrid,
     Table D-3 lists the net power as 142kW, whereas Table E-2 lists it as
     140.6kW. Similarly,  the engine power is listed as 116kW in Table D-3,
     but as 114.8kW in Table E-2. Even a rounding of the numbers doesn't
     make them the same.

Miscellaneous
   1. Table A-l has a calculation of the percent decrease/increase in cost
     of adding the power split system to different vehicle segments. It
     would be more appropriate to calculate the percentage increase as
     compared to the base non-hybrid vehicle cost, instead of calculating
     the increase with respect to the mid/large size vehicle segement cost.
   2. Nowhere in the paper (for example, section D.7.1 makes no mention of
     it, and neither do Tables D-5 or D-6)  could this reviewer find the
     mention of the high voltage DC/DC converter  (which converts the
     voltage from approx 300V to approx 600V, and subsequently utilized by
     the traction motor and generator), which is used in the Fusion Hybrid.
     The corresponding cost for this part is also not mentioned.

Grammatical/Typographical Errors
              -. nd
   1. Page 10,  2  line,  replace "advance" with "advanced"
              ,rd
   2. Page 11,  3  line,  replace "value" with "valve"
              ,rd
   3. Page 18,  3  line,  replace "standardize" with "standardized"
                            st
   4. Page 18,  paragraph 2,  1  line,  replace "very" with "vary'
                          -th
   5. Page 19,  paragraphs,  5  line from bottom,  replace "develop" with
     "developed"
   6. Page 21,  extra bullet point in Scenario #2
   7. Page 52,  last paragraph,  replace "Too" with "To"
   8. Page 52,  last paragraph,  replace "truck" with "trunk"
   9. Page 56,  2nd paragraph, replace "approximate" with "approximately"
   10.     Page 91, 3rd paragraph, replace "acknowledge" with "acknowledged"
   11.     Page 97, 1st paragraph, replace "VEV" with "HEV"
Date:  March 11,  2011       Page 6 of 7

-------
Date:  March 11,  2011       Page 7 of 7

-------