Slow Sales Dogged Volt Before Fires
By Sharon Terlep
DETROIT—Before General Motors Co.’s Chevrolet Volt became the subject of a U.S. safety investigation, the auto maker’s moon shot was falling well short of its stratospheric expectations.
GM’s year-old, battery-powered Volt, cast by the company as a revolution in automotive technology, will miss the sales target of 10,000 vehicles that Chief Executive Dan Akerson set for this year, hampered by production delays, distribution problems and questions about whether Americans really want electric cars. The company is on track to sell around 8,000 Volts this year.
Much more at the link. But the article continues to tell us that General Motors has set a sales target of 45,000 Volts in 2012. The car costs $41,000 per unit, and GM loses money on every unit sold. The federal government offers a $7500 tax credit, but even with that, the car is simply not economically competitive with other high-mileage automobiles; the Chevrolet Cruze starts at $16,720 and gets 42 miles per gallon on the highway, while the Volt gets 40 MPG when the small gasoline engine is running and 95 MPG when on battery power.
The math: if the Cruze costs $16,720, and the Volt $41,000 (with a $7500 tax credit), the cost difference between the two is $16,780. Ignoring financing costs (buying the Volt means paying $41,000; you don’t get the tax credit until tax refund time), and assuming that the Volt is compared to the Cruze 29 MPG city/42 MPG highway, assuming a combined mileage of 35 MPG and gasoline at an average of $4.00 per gallon — and it’s less than that now — you can drive the Cruze for 146,825 miles before you’ve spent as much as you would to buy the Volt, and that assumes that you never put a drop of gasoline in the Volt. (And we all know that the household electricity to recharge the Volt is free, right?)
But there’s more. To own a Volt, with any sense of practicality, means that you have to have a garage in which to park it, to have the specific SAE J1772-2009 electric receptacle to charge the batteries; at a standard 120 volt, 15 amp circuit, a full recharge takes twelve hours, though the time can be cut to three hours if a 240 volt circuit is installed. The vehicle comes with a standard 20 foot long charging cord. This is simply not a vehicle which can be parked outside and charged.
The Volt is simply not a first car; it is a second vehicle, with restricted uses. $41,000 is a lot of money for most American families to shell out for a second car . . . or even a first.
And now, failed crash safety tests have the Volt on the ropes again, and GM is planning a Volt Repurchase Team to buy back Volts from customers who still aren’t satisfied. Dan Akerson, General Motors’ Chief Executive Officer, said that the Volt is safe, and he plans to buy one of the repurchased vehicles for his wife. As one of the commenters on the JOURNAL article said, he might be more impressed and consider buying one if Mr Akerson was going to buy the repurchased Volt for himself rather than for his wife.
Our “progressive” friends have simply misjudged how the American people think. According to “progressive” logic, there should be a substantial demand for vehicles like the Volt. But, as we already knew, what the American people really seem to want is larger vehicles, such as SUVs and trucks. Reality seems to have a harsh way of intruding on “progressive” logic.