Intel's former chairman and chief executive officer, Andy Grove, is, according to a report in the Wall Street Journal today, bending the ear of the current top brass at the chip company to make batteries for electric powered cars.
There's a volume market with relatively small research, development, and manufacturing retooling costs. This could be the best news that Advanced Micro Devices has had in years if current CEO, Paul Otellini, and the Intel board actually go for it.
Don't misunderstand. The world needs a new way to get around that doesn't produce so much carbon. And there is no question that the current battery technology, despite investment from electronics manufacturers, heavy equipment makers, various militaries and governments, and so on, is why we don't have an electric car capable of doing what is required.
Intel has lot of expertise in making processors, and was able to brilliantly transform itself from a memory chip maker to a central processing unit and chipset maker - a move that Grove spearheaded.
But the kind of hubris that Grove is expecting Intel to show again as it buffalos its way into the battery market - which has its own experts and manufacturers who are trying to crack the problem - is the same kind that launched the Itanium processor in the mid-1990s and expected the market to follow its way to a new and incompatible architecture, despite ka-gillions of dollars in x86 software investments.
Or the same company that later insisted it didn't need to make 64-bit memory extensions to its Pentium family of chips, thereby leaving an opening big enough for AMD to drive a truck full of money and hope through. Not making such stupid moves is why Intel has its chip house in order again and, not coincidentally, why AMD is under such pressure.
The WSJ report says that Grove is suggesting a move into batteries is an opportunistic one as well as a nationalistic one. The former as a means of diversifying Intel's business and the latter because the launch of electric cars in the States will require hundreds of thousands of batteries and there is very little indigenous manufacturing capacity; the report suggests that Panasonic, Sanyo, and BYD Motors are trying to dominate the production of batteries for electric cars.
The report goes on to say that GM is already working with A123 Systems, and two other battery makers - Boston Power, which makes laptop batteries, and Valence Technology, which makes batteries for the Segway scooter - to make batteries for electric cars, too.
Intel's official public statement about the idea to the WSJ was that Intel Capital, the company's venture arm, already has investments in battery technology companies, and considering Intel is staring into a recession-driven 12 per cent decline in sales from the third to the fourth quarter this year and heaven only knows what next year, the smart thing to do is to make investments that make laptops better and leave the car business to the idiots that are running that (mostly into the ground).
As the American car makers have shown so brilliantly, there is no profit in cars, electric or otherwise, at the moment. And if Grove is so hot to trot on making battery systems to power cars, then he should take his own considerable wealth and deploy it there. Grove can make bets that are too risky for Intel to take right now. ®