‘Fire Sale’ Prices Can’t Save Chevy Volt

MARCH 5, 2012


Wouldn’t you know it: No sooner did General Motors start shipping its Chevrolet Volt toCalifornialast month before the automaker decided to halt production of the low-emission vehicle.

Californiacar buyers must be bummed. To bribe them to purchase the $40,000 (and up) sedan, the state not only offered a $1,500 taxpayer-funded rebate, but also its blessing to Volt owners to drive solo in H.O.V. lanes. And the federal government kicks in a $7,500 tax credit.

GM sure expected to sell a lot of its electric flivvers here in the GoldenState. “The Volts with the low emissions package are certain to be a strong draw for California commuters looking to travel the state’s notoriously congested freeways in the carpool lane,” Chris Perry, VP of Chevy Marketing, told the Detroit Free Press.

But then came the automaker’s announcement this past Friday that it is shutting down its Volt assembly line until April to maintain “proper inventory levels.” That follows a similar shutdown that began back in December that didn’t end until last month.

Chevrolet sold only 8,000 Volts in 2011, 20 percent below GM’s overly optimistic forecast. That was due at least in part to the bad press the EV got after two battery fires in crash tests.


But the bigger issue is that, to most of the car-buying public, the upside of owning a Volt, or most any other electric vehicle, is outweighed by the downside.

Yes, state (and federal) rebates are appealing. Yes, a sticker entitling a solo driver to use the carpool lane certainly is valuable. And, yes, there is a certain satisfaction for some Californians in doing their part to arrest climate change.

Yet, most of us do not consider those incentives, that satisfaction, sufficient to abandon our gasoline-powered cars and SUVs for electric flivvers.

We prefer the lower purchase price for our old-school cars. We like that we can fill our gas tanks in just a few minutes, whereas it takes as many as eight hours to fully charge an electric vehicle. We like that even the most-guzzling car can make a roundtrip between Sacramento and San Francisco, or Los Angeles and San Diego, with no sweat, while the average electric vehicle has driving range of less than 100 miles.

That’s why Chevy Volt sales have been so disappointing that GM has halted production of the electric vehicles twice in the last four months.

That’s why there is less than zero chance that Fisker Automotiive, the Anaheim startup, will generate annual sales of 115,000 plug-in hybrid vehicles by 2015, as it guaranteed when it was awarded a $529 million federal loan.

That’s why Tesla Motors, the nine-year-old Silicon Valley company, has manufactured little more than 2,000 of its much-hyped roadsters, the first fully electric sports car — and at a $109,000 base price that is far beyond the means of the 99 percent of us that are not Hollywood actors, professional athletes or lottery winners.

There may come a day when there is a viable market for electric cars. Not one artificially created by government subsidies (like $1,500 to buy an EV), incentives (like carpool privileges for EV owners) and mandates (like the California Air Resources Board requirement than one of seven cars sold in 2025 must be plug-in hybrids or fully-electric).

But until EV prices are comparable to gas-powered vehicles, until EVs can be fully charged in minutes rather than hours and until the driving range of fully-charged EVs is comparable to at least the most fuel inefficient gas guzzler, that day is a very long way off.

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