General Motors is boosting Israel as an automotive R&D source,
and the rest of the world is catching on.

ALAN ABRAMS SPECIAL TO THE JEWISH NEWS

into automotive research currently underway at Israeli
universities, government laboratories and private com-
panies.
Launched only in April, Mr. Baker is pleased that five
initiatives are already underway and another 80 projects
are being reviewed. "We have a science review team made
up of people in Israel from UMI and GM," he says. "The
proposals come in, we review them against strategic
intent," and if the potential is there, "go back and make
a recommendation that the venture invest."
Although GM is closemouthed on technological details
of projects already underway, industry speculation ap-
pears to focus upon op-
tical-detection machines
and computerized nav-
igation devices. Mr. Bak-
er provided some clues
in a speech he delivered
before the First Israel-
North American Busi-
ness Conference in New
York in October, prior to
his departure for Israel.
"These projects range
from advanced materi-
als, electronics and sen-
sors to machine vision
and vehicle parking de-
vices," Mr. Baker said at
the time. "But we also
see additional joint pro-
ject opportunities in elec-
tric vehicle components,
software, and advanced
vehicle communication.
Mr. Baker, who also
leads GM's recently-un-
veiled electric vehicle
project, serves as a
member of the GM-UMI
board. He has been the
head of GM's R&D Cen-
ter since 1993 and,
working in tandem with
GM Chairman Jack
Smith, has restored the
function of GM's R&D to
the worldwide prestige
it held during the C.F.
"Boss" Kettering/Alfred P. Sloan heyday.
Although GM does not have an assembly plant in Is-
rael, its plant in nearby Egypt is a relic of the Arab boy-
cott, an era which GM executives are still loathe to
discuss.
Could there be an Israeli-built car on the GM hori-
zon? Not likely, says GM's Mr. Brown.
Citing the difficulties with the last such attempt some
30 years ago, Mr. Brown says the fiberglass body of the
vehicle proved irresistible to camels, which loved to eat
the body. "That's why I tell my engineers who want to
bring a Corvette to Israel that it's not such a good idea."
That factor, combined with the smaller potential for
sales of a home-grown vehicle as compared to the po-
tential markets in China and India, would preclude
such a venture, although Mr. Baker refuses to rule it

out altogether. But the decision by GM to invest in Is-
rael's economy was obviously not preconditioned in
terms of potential vehicle sales.
"If the market for cars is going to be global, so should
the technology," says Mr. Brown.
And indeed, Israeli automotive-related technology is
rapidly going global.
According to reports published in European media,
the $350 million partnership deal signed earlier this
year between Israel's Dead Sea Works and Volkswa-
gen, the world's fourth largest automaker, is the largest
single European investment in Israel and the first ma-

'VP

jor German investment. That joint venture involves es-
tablishing a plant to extract magnesium from the salty
waters of the Dead Sea.
A second stage of that deal, implemented this fall,
involves a further $350 million investment to expand
the plant's production capacity to 55,000 tons a year.
When that happens, it would make Israel the third-
largest producer of magnesium after Norway and Cana-
da.
Still under negotiation is a deal to establish a die-
casting plant at the Dead Sea to manufacture auto parts
on the spot.
But that isn't all. Volkswagen has also kicked in an
additional $32 million to help establish a magnesium-
research facility in Israel. That's in addition to $5 million
from a Japanese electronics concern and government,

company and university funds. Estimates are that Is-
rael will eventually spend up to $10 million a year on
magnesium R&D in the hopes of creating new alloys.
Another Israeli company, Cubital Ltd., has developed
a rapid prototyping system that makes quick, accurate
models using a material that hardens within a few sec-
onds after exposure to ultraviolet light.
Among their customers are Toledo Molding & Die,
a Toledo, Ohio, firm, which has purchased two of the
machines. According to Rick Elchert, the company's su-
pervisor of Cubital, the company has used the machines
to manufacture parts "mostly for Ford and Mazda as
well as for some out-
side clients, but very
few for Chrysler or
GM."
According to a
report in the Wall
Street Journal Europe,
Chrysler Corp. origi-
nally used Tecnomatix
Technologies Ltd.'s
computer-aided pro-
duction-engineering-
software products in
the development of its
Cirrus and Stratus
mis ize cars, but has
since dropped the Is-
raeli firm and switched
to a rival system de-
veloped by a subsidiary
of France's giant Das-
sault Aviation, the
folks who make the
Mirage jet fighter.
In yet another
report of a major auto-
motive-related invest-
ment deal for Israel,
Electric Fuel, the
Jerusalem battery
manufacturer, formed
a consortium of poten-
tial customers, includ-
ing Mercedes-Benz,
Opel, Germany's na-
tional post and tele-
phone services, and
Sweden's postal service and largest utility, to run an $18
million, two-year field test of a zinc-air battery that will
allow electric vehicles to travel up to four times as far as
they can on currently-available batteries.
If successful, the program could result in Electric Fuel
equipping 40,000 delivery vehicles in Germany as early .
as 1998. The test sites are in Bremen, Germany; Gelder-
land in the Netherlands; and in South Africa.
Underlining the explosion of Israel's auto parts sourc-
ing business is a recent story in the Jerusalem Post that
the American-Israel Chamber of Commerce of Michigan
plans to create a subsidiary Association of Israeli Auto-
motive Parts Products and Developers.
To paraphrase the immortal words of former GM Prei-
dent Charles E. Wilson: What's good for General Motors
is even better for Israel. ❑

