GM brain drain: Chevy Volt leader jumps to Calif. battery startup

General Motors is losing one of the key players on the team developing the Chevrolet Volt — the hotly-anticipated plug-in vehicle that is supposed to forever change the green vehicle market. And where is Denise Gray, director of global battery systems, going? Where else? A battery startup in California.

So far, the company that stole her away hasn’t been identified. Gray only says that she is stepping into a senior management post at a California startup that is still in stealth mode. That rules out battery-switching champion Better Place, as well as Tesla Motors, which has been assembling some of its own battery packs. With limited details available, it could be any number of companies. She didn’t even specify whether she’d be based out of Silicon Valley or Southern California — but we’ll update as soon as we hear.

Regardless of where she is going, her departure is bad news for GM. It not only continues to struggle financially post-bailout, but is having a more difficult time retaining its most talented employees. It’s hard to blame someone for leaving Detroit for California, especially if they have a better opportunity waiting for them. Unable to ratchet up compensation, the company’s hands are tied.

It’s unlikely GM will be able to attract a replacement of Gray’s caliber to fill her very vital shoes. The Chevy Volt is only so special because of its advanced (and pricey) lithium-ion battery pack. Gray, a 30-year veteran at the company, was the one who oversaw development of more affordable, efficient battery models for GM’s plug-in and extended range hybrid vehicles. On her watch, GM was able to roll its very first lithium-ion Volt battery off the assembly line right on time on Jan. 7 — a big victory after years of development.

During the announcement of her departure, Gray said she was looking forward to building a venture from the ground up, rather than focusing on only one segment of a massive business — though she is very sad to leave before the Volt launches in 2011. Her last day at GM is March 5.

Gray’s transplant to California is just the latest indication of Detroit’s dire brain drain problem. In September, a series of articles came out analyzing the region’s loss of talent and what it might mean for the city in years to come. With unemployment in the metro area nearing 30 percent, Detroit has the distinction of being the worst city to be out of work in the country. And it’s unlikely conditions will improve with more than 50 percent of Michigan students leaving the state immediately after graduation and 25 percent of young professionals in Detroit planning to leave within two years.

The state government, led by Governor Jennifer Granholm is going to great lengths to staunch the bleeding — but it still looks like a losing battle. For example, last year, the legislature passed upwards of $300 million in tax credits to lure advanced battery companies to the Detroit Metro region. The tactic has produced some results, with big names like A123Systems and Johnson Controls setting up shop nearby. But other technology companies aren’t convinced. Fisker Automotive, maker of the luxury plug-in Karma sports car, shut down its operations there early this month, and has opted to open its first major manufacturing plant in Delaware instead.

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