Is GM Really Building the Volt So it Can Sell More Gas Guzzlers?
An editorial appeared today in the Wall Street Journal entitled "A Volt Out of the Red". It was written in reaction to the transportation department’s proposal yesterday that cars be required to get 36 mpg by 2015. The author asks the question, in light of this, as to whether GM was "genius or dolt" in its plans to build the Volt.
He accuses the "near-dead" GM of boasting about the Volt during the media day earlier this month, and GM vice-chairman Lutz’ (he mentions the crock comment) public admission of competing with Toyota at "it’s own game of selling bogus green symbolism to Washington and Hollywood."
In the punch line, though, the author claims GM may actually be building the Volt at a loss and plans to "bribe consumers" to buy them, all for the elaborate purpose of using them to dilute the low mpg’s of the more powerful cars they actually wish to sell.
I’ve given this idea some thought, but from what I can tell firsthand, E-Flex is here to stay for the long-haul, it will be a massively global product, and in Lutz’ own words, "the electrification of the automobile is inevitable." What do you think?
Source (Wall Street Journal )
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97 Responses to “Is GM Really Building the Volt So it Can Sell More Gas Guzzlers?”
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April 23rd, 2008 at 8:50 pm
“author claims GM may actually be building the Volt at a loss and plans to “bribe consumers” to buy them, all for the elaborate purpose of using them to dilute the low mpg’s of the more powerful cars they actually wish to sell.”
If that is GM’s plan, great! I’ll take a subsidized Volt to support their cause to acquire massive profits via large vehicle sales. In the old days of regulated telephony, long distance revenue subsidized local phone service costs. If people want their hummers and 500HP engines and in so doing reduce the cost of a volt, super! Choice is wonderful.
Ah.. sales person… I’ll take one sized for 6′4″ please, yes, that’s it, the electric blue one…
April 23rd, 2008 at 8:50 pm
If that were true, it is foolish for GM to pursue the plug-in, series route. There is no guarantee that they will get any more credit towards CAFE for the electric only range. If they were really trying to hedge their bets, something closer to the Prius would make more sense where the battery is always used to aid the engine in order to maximize overall fuel economy.
April 23rd, 2008 at 8:53 pm
Clearly GM is aware that the Volt will bring up the average MPG of their entire fleet, but I don’t think that is their primary motivation. They could have developed a much cheaper 50 MPG vehicle than the Volt using conventional methods (Europe has been doing it for years), or even a relatively uncomplicated hybrid like the Prius. They chose this game-changing project, I believe, because it is going to be their last opportunity to be a leader on anything for a long time to come. If they let Toyota or Honda do this first, GM will never again reclaim its former glory. I have been really down on GM recently for the endless changes to the Volt, but I have never doubted their motivations; they aren’t trying to offset the higher MPGs of the rest of their fleet as much as they are trying to do something revolutionary that will make buyers consider buying American again.
April 23rd, 2008 at 8:54 pm
In the short term, there is some truth to this. After all you can’t expect GM to just halt production of all it’s vehicles and just produce the Volt.
The problem in the automotive cycle is that it usually runs 4-5 years and it’s difficult to predict what will sell. Who’d have thought even 7-8 years ago that all these large SUV’s would be selling like they are especially since gas prices have been steadily rising.
We’ve reached a point however, where any auto maker not considering EVs or RE-EVs for the future will be out of the game. In the next 5-7 years SUVs will not sell as they have for the past ten and we’re at the point of no return. I think GM realizes this.
April 23rd, 2008 at 9:18 pm
I think GM’s stategy is a little like playing cards, try to have a good hand of cards and play them carefully.
That is a good strategy if the next decade is just a extension of the last.
However, if there is a transport fuel crisis, and I think it is now inevitable, they would want to bias their cards in favour of low energy vehicles.
Why?
Because the consumers dont care about CAFE legislation.
In a fuel crisis they will buy any economical vehicle they can and the rest will be left in the manufacturers stocks.
If you see what I mean……
April 23rd, 2008 at 9:22 pm
The first thing to look at is where this article was printed. The Wall Street journal a conservative newspaper who probably down plays the effects of global warming and thinks that green cars are only for a bunch of hippies. GM is taking a risk no doubt but if they did not think they would eventually make money there is no way they would pursue it. Also, look at what chevy is coming out with tahoe hybrid and silverado hybrid they are even trying to bring up the mpg’s on gas guzzlers. GM knows with gas at 3.52 and rising people are going to want this car especially considering that this car will be a better performing car than the prius. I hope the volt is a great success and we can keep an american car company alive.
April 23rd, 2008 at 9:29 pm
It’s absolutely cheaper to build the volt than it is to build a fleet of vehicles that get the new MPG standard. I really don’t think there was much of a choice. At the end of the day we get volt like technology that I am very sure will change the future of vehicle propulsion. It will also “buy” GM more time to phase in more efficient gas engines. They won’t be going away anytime soon.
April 23rd, 2008 at 9:30 pm
I believe GM is building the Volt, because it is the best flexible platform to rapidly move them to high efficiency, while maintaining great performance. Pretty quickly, GM is going to realize that it is a platform that will work well for their larger vehicles as well.
April 23rd, 2008 at 9:31 pm
The vehicle in the above picture looks like the clay real Volt shows with the blanket covering the hood with robot sculpters. Anyone know if this is it?
April 23rd, 2008 at 9:36 pm
Whether or not this is good depends on the maths (and the precise legal wording of the law).
If only average vehicle MPG is used then selling 1 Volt could enable as many as 6 guzzlers to be sold. The net result is probably very bad because 6 guzzlers would drive 6 times as far as 1 Volt.
Guzzler 1, 10mpg 1000 gallons for 10000 miles
Guzzler 2, 10mpg 1000 gallons for 10000 miles
Guzzler 3, 10mpg 1000 gallons for 10000 miles
Guzzler 4, 10mpg 1000 gallons for 10000 miles
Guzzler 5, 10mpg 1000 gallons for 10000 miles
Guzzler 6, 10mpg 1000 gallons for 10000 miles
Volt 150mpg 67 gallons for 10000 miles
========
average 30mpg, but 6067 gallons used by these 7 vehicles
Compare with 7 vehicles all getting 30 mpg, each uses 333 gallons per 10000 miles, with a total of only 2333 gallons.
Using an average MPG like this is really silly, GM could give away 1 totally impractical vehicle that gets 1000 MPG and use that credit to sell about 30 guzzlers.
Using an average is often silly, imagine you have 5 clocks, they say: 5:00pm 5:00pm 5:01pm 5:00pm and 10pm. What idiot would make use of the average time?
I believe that the intent of Congress is to lower total consumption, or at least total consumption per mile driven, in which case that is what should be measured.
Now if the math is done by taking total fuel consumed by all vehicles and their total mileage, to give the average MPG for the fleet as a whole, that makes sense.
In the case of the sensible calculation method if the Volt is subsidized by the guzzlers that will be fine. If the Volt is sold at full cost price that would be bad because then Volt owners would in effect be subsidizing the guzzlers.
There was an energy bill that prevented utilities claiming carbon credits for renewable systems installed by customers. Similarly Volt owners should not pay for the credits claimed by GM unless the Volt is sold below cost.
April 23rd, 2008 at 9:44 pm
Of coarse GM will take advantage of the Volt to meet the CAFE standard and allow them to make bigger more powerful vehicles without penalty. This is smart strategy. First and foremost GM is supposed to be in business to make as much money for their shareholders as possible. That means selling as many cars and trucks as possible to as many people as they can. This means a wide variety of vehicles including gas guzzelers because lots of people still want them.
I do believe they understand the market forces and see that the electrification of the car is upon us. They realize that technology has reached a point now that this is going to be an upward trend not just an eclectic niche market. They not only want to be a player in this market, they want to be THE player in this market. So the WSJ is somewhat correct in their cynicism, but I also believe that the E-Flex drive is here to stay until which time they can move to either a BEV that delivers gasoline performance or fuel cell that can achieve gasoline cost and convenience.
April 23rd, 2008 at 9:46 pm
I believe that GM knows that the guzzler is on a downhill slide. It’s inevitable. Even if you don’t believe that oil reserves are maxing out, China, SE Asia and India will be buying more and more oil in the coming years which the USA has to bid against for it’s own supplies. The cost will go up regardless so it is in GM’s best interest to change the paradigm as they’ve said.
If the Volt comes out quickly and at the right price to capture the hearts, minds and pocketbooks of the North American consumer, it will be the salvation of a revitalized and energized General Motors! They can then turn their attention to porting over the technology into every segment of their business, weaning themselves and the public off of heavy oil and gas use.
Go GM, Go Volt team….lets see the final design on the road in late summer! That would freak out the competition.
April 23rd, 2008 at 9:53 pm
Wow, that’s an interesting assertion.
Isn’t it like asking, “If you give to charity, and then take the tax deduction, are your motives still as pure?”
April 23rd, 2008 at 9:56 pm
“author claims GM may actually be building the Volt at a loss and plans to “bribe consumers” to buy them, all for the elaborate purpose of using them to dilute the low mpg’s of the more powerful cars they actually wish to sell.”
Hey author, can you give the consumers some respect, will you. I am pretty sure that most consumers who are about to spend $1000s nowadays are very aware what kind of car they are about to purchase, me for one know very well that the day I walk in a chevy dealer, I know what I will be looking for…A volt.. I will careless about the guzzlers, but if I am in the market for one is not because GM bamboozle me to it, it will be because I need/want one.
April 23rd, 2008 at 10:07 pm
Vincent #9
I doubt it. The Volt in the photo above looks like the classic “concept” Volt with sunken headlights and a flat hood. The low CD Volt also has wrap around headlights, and a scoop directly below the radiator.
April 23rd, 2008 at 10:09 pm
Does GM want to sell lots of huge gas guzzlers? Of course they do! If they don’t sell huge gas guzzlers they will soon have to declare bankruptcy or maybe sell themselves to Ford.
The real question, Mr. Wall Street Journal writer, is do they want to sell huge gas guzzlers TOMORROW. It’s the strategy they will use to get to the desired state of profitability that you should be writing about.
If GM’s strategy is to sell Volts at a loss to satisfy the CAFE legislations of today in order to sell more huge trucks in the future then I think most sane people would agree that’s a loosing strategy. If GM were that abuse then they will go down in history as a great automobile manufacturer of the 20th century. End of story.
If GMs strategy is to sell Volts at a loss in order to keep selling huge trucks until they can get their fleet converted over to the highest quality electrified and other bio-friendly vehicles on the planet and to remove themselves from having to deal with the high uncertainty of petroleum fuels then that would be a winning strategy. The story continues.
Oh, I have to comment that the quality of posts at GM-Volt have gone up considerably in recent months. I enjoy reading and responding to both the main articles as well as to the interesting topics found in the forums section. Keep up the great work!
April 23rd, 2008 at 10:10 pm
Oh my goodness… what a worthless article. Who really cares WHY they are building cars of different mpg. Guess what the only reason chevy is building ANY car is because they want to make money. They don’t give a crap if everyone wants a gas guzzler and they don’t car if everyone wants to ride a volt. They only care about making cars that will sell. If it is pink then they will make pink EVEN if they hate pink cars.
April 23rd, 2008 at 10:15 pm
Of course GM is… they are a public company with share holders… the larger vehicles is where the money (profits) are.
Does anyone really think Toyota is any different with their Prius? Keep in mind that Toyota is hand in hand with GM and other auto makers in having fought tooth and nail any meaningful CAFE increases, and in fighting California’s stronger emission standards. I see just as many if not more commercials for Toyota’s big trucks as I do for the Prius and other Toyota vehicles.
To those that went to Volt nation and stayed for the auto show… look at the gas guzzlers on display side by side with the gas sipping cars.
Between gas prices and now food prices, consumers are being forced into the choice of vehicle they should have been making all along if they were really serious about fighting terrorism and the long term economic health of our great nation. The auto companies better update their business plans with other ways to make more profits.
April 23rd, 2008 at 10:21 pm
Oh yea, almost forgot… GM, Toyota, etc also all want to sell lots of vehicles in the worlds largest growth market for autos… aka China.
As some of the press has mentioned (but most don’t), while China is building coal plants like they are going out of style, China is also making much more in roads into curbing vehicle emmissions… with much stronger fuel efficiency standards than the USA…. I think their requiements already or soon will exceed those that the CAFE standards will eventually go up to in over a dozen years from now here in the USA
April 23rd, 2008 at 10:44 pm
Jeff M,
I agree. In that recent yahoo article it was mentioned that chinese families aspire to a Camry costing ten salaries.
However hybrid prius sales in china are flat so I guess they can not see much value in those parallel drive systems
The Malibu mentioned in yesterdays press with a four cylinder and six speed transmission would seem the ideal car for China at present. 32 miles to the gallon I believe.
April 23rd, 2008 at 10:57 pm
The author of that article sounds like the typical GM-hater sounding off. Either that, or he’s not aware of Toyota’s extensive line of 13-17 MPG (city) gas guzzlers: Land Cruiser, FJ Cruiser, Sequoia, Tundra, Tacoma, Highlander, and Sienna.
Maybe the Prius is just bribe to consumers so Toyota can sell more of the gas guzzlers that they really want to?
April 23rd, 2008 at 11:00 pm
The author of that article sounds like the typical GM-hater sounding off. Either that, or he’s not aware of Toyota’s extensive line of 13-17 MPG (city) gas guzzlers: Land Cruiser, FJ Cruiser, Sequoia, Tundra, Tacoma, Highlander, and Sienna.
Maybe the Prius is just a bribe to consumers so Toyota can sell more of the gas guzzlers that they really want to?
April 23rd, 2008 at 11:21 pm
If the MPG average is a reflection of total units produced, then GM must produce enough Volts (and other fuel efficient vehicles) to offset the production of larger trucks and SUV’s which will bring the curve down.
If this is the case, then why is this editorial complaining? GM can’t control how individuals will use a particular vehicle. What GM can do is produce a vehicle like the Volt with decent styling and a positive financial and ecological footprint, in enough quantity to bring the curve up past the minimum requirement.
Consumers will determine what they want to drive, but the more that we see vehicles like the Volt, the easier it will be to convince the general public that a fuel-efficient vehicle is worth purchasing. For the masses that would love Prius technology in a vehicle that doesn’t resemble the love-child of the Jetsonmobile and a “scrubbing bubble”, I applaud this move.
Lyle, great minds think alike! Tall enough to fit me, and I’d dig that Blue I saw on a new Trailblazer the other day!
April 23rd, 2008 at 11:27 pm
The importation of oil adds significantly to the US trade defiicit and is directly responsible for wars and unholy intergovernmental alliances. If US automaker chiefs (and stock holders) have the courage to look past the next quarter performance, they can look back and say they helped bring about something to bring economic stability and national security to their grandchildren.
Either way, there is no future for GM with gas guzzlers. Peak oil has arrived. Carbon tax / cap-and-trade legislation is on the way. To quote Darwing, “It is not the strongest species that survive, nor the most intelligent, but the ones most responsive to change.”
April 23rd, 2008 at 11:51 pm
I don’t think GM wants to sell gas guzzlers. GM just wants to make money. It’s the American publics demand for big powerful cars that drives GM’s policy. At the same time, GM knows that gas prices are only going to go up, so they are expecting the demand for gas guzzlers to go down over time.
So the Volt does 2 things.
Near term, it makes their average fleet MPG lower, enabling them to sell more of the gas guzzlers that people seem to want right now. GM is willing to take a loss on the Volt near term to enable sales of bigger cars. So the Wall Street Journal article is correct for the near term. What else would you expect from Wall Street?
Long term, as gas gets more scarce and fashion changes, the Volt and other E-flex cars will become more popular and GM will make money selling them.
So GM makes money selling the Volt both near term and long term. In my mind, this is a good thing, because if GM doesn’t make money somehow by selling the Volt, then they will stop selling it. After all, GM is in business to make money. Let’s just hope the long term scenario plays out sooner than later.
April 24th, 2008 at 12:00 am
The editorial is short-sighted. Of course the Volt will help to meet short-term efficiency requirements. But, down the road, Volt technology will spread throughout the fleet, even to the vehicles we now call gas guzzlers. “Gas Guzzlers” will be a quaint term once autos have gone electric. I’m sure GM will still be selling the large vehicles people want. But, those vehicles won’t be gas guzzlers.
April 24th, 2008 at 12:55 am
In my wildest dreams, would I rather drive a Volt or a Viper? Of course a Viper. But then I wake up and realize that driving to work in a car with 500 HP that gets 13 MPG is just a ridiculous waste.
GM has to sell what they can produce today. But with the changes in cost of the fuel to power these vehicles, the public demand for for gigantic vehicles with gigantic fuel requirements is very quickly going to end. Everyone has a “tipping point” where the cost of fuel just gets to the point that they demand a change. Mine was at $2.50 per gallon. As we edge closer to $4.00, I expect that a majority of the driving public is going to have that same opinion.
At least GM is in the game to move ahead to something new. The Volt is simply the first step in a long line of new vehicles.
I just hope that all the manufacturers can get their projects to market quickly and in enough volume to make a real difference!
April 24th, 2008 at 1:00 am
Gee, hear about the massive diesel shortage in Southern China?
duh, the Volt is here to stay along with its technology. Even the gas guzzles will be more efficient soon. Especially with E-Flex.
April 24th, 2008 at 1:19 am
OK I would like to make a few comments about Wall Street before even addressing the comments of the Wall Street Journal.
#1 Wall Street is the most unAmerican bunch of greedy profit mongers there is as can be evidenced in their lack of support of GM’s earliest Electric Car efforts back in the 80’s. When the OPEC Nations fresh off of sticking it to us back in 1973 decided they had to drop the cost of fuel in order to destroy GM’s plans and when the price of Gasoline dropped to below $1 a gallon the Wall Street types slammed GM for investing in such a foolish technology anddemanded higher profits thus the amount of SUV built by GM. This was detailed in the report done by N.Y. Times award winning Journalist Thomas Friedman.
#2. Wall Street has a mixed history on picking winners, and no one seems to point this out.
#3 The Wall Street Journal is owned by one of the Oil Industry’s largest supporter and a man who made his first Million selling trashy newspapers in his native Australia before moving to the USA to influence politics here. The same company who owns Fox News who did a less than good review of the owner of this website.
Now on to merits of his comments about this being a ploy to sell more gas guzzlers. I would say to that comment that if you look at all of the other inatives which are beyond the scope of this website since we are only talking about the Chevy Volt here and not the Chevy Equinox that a few Californians such as Jay Leno are driving that are pure Fuel Cell Automobile as well as the possible replacement for the smaller SUV’s such as the Chevy TrailBalzer called the Chevy Sequel again a pure Fuel Cell paltform then we would see a significant amount of future investments in technologies that are not gas guzzlers as this really out of touch Wall Street Journal journalist is talking about.
I challenge this small minded journalist to stop counting GM down an out , and look at the many new concept cars that are making the many International Automotive shows that would indicate that GM is moving away from Gas Guzzlers.
I recently looked at the MPG of many SUV’s out there including almost all of GM’s competition domestically and internationally and they have the highest MPG of almost anybody so it would appear this older label doesn’t apply to the new GM. I would ask this very same journalist who drives I doubt a GM product to compare the production super cars out their that in many cases cost far more than a Chevy Corvette and notice the MPG. The Corvette is the only one that doesn’t have to pay the Gas Guzzzler Tax….In fact the Z06 Engine is so economical that it is the engine of choice for hobbyist doing Restro-Mod’s ever since GM made it available as a crate engine.
For those that don’t know what Restro-Mod is it applies to the term Restoration Modification where the Car is being restored to be driven and not for being a collector so where newer technology such as better electrical, and power plants exists they are used to improve drive ability and yet retain the older styling and looks. The Z06 crate engine is popular because it outputs over 500HP and 500ft/lbs of Torque on pump gas and get 20+MPG will doing it.
I apologize for getting off the subject of the GM Volt, but I thought it important to talk in a broader level about this near Down and Out GM that this poorly educated Wall Street Journal journalist is attacking for building the Chevy Volt for as he accuses merely as a way to justify building Gas Guzzlers.
I still want to know when I can buy one in Dallas so I can go and drive by the World HQ of Exxon and stick out my middle finger while sitting comfortable in the front seat of something that uses little if any of their oil bought with blood.
Butch
April 24th, 2008 at 1:44 am
Oh I forgot add that if GM and other Truck Manufactures want stay in the game they will have to develop more fuel efficient power plants for Light, and Medium Truck where today only a gasoline power plant producing in the 10MPG range exists. The publication “Light & Medium Truck” forecasts that CAFE will dictate the eventual movement of Diesels down size and down scale in the majority of Light Trucks or it will be impossible to meet these newer CAFE numbers.
General Motors is one of the market leaders here and will have to make significant changes or see this market disappear. The recent introduction by Jeep of a smaller diesel engine in the Jeep Liberty was such a success they sold out of the years allotment in just a few weeks. This left Daimler Chrysler with a problem since they actually bought a very smaller production run from a Italian company and had no smaller Diesel Power Plant themselves. The problem with GM today is they actually like many other retrofot a larger Diesel from someone like Cummings into their largest trucks which is several liters larger than a smaller truck can support of need so there will need to be significant changes made, but according to the publication i mention previously the death of the Gasoline V8 is expected and the future choices will be either a V6 or a light duty Diesel in order to meet CAFE.
So again this Wall Street Journal journalist is really out of touch about GM’s future plans for Gas Guzzlers. The market place itself being the large fleet operators like construction companies will demand a more economical product to operate and they will buy it from whatever company produces it.
BTW the newer generation of Diesels are very economical, and Diesel fuel can produced for less money since it is easier to refine and can be made from lower grades of oil than the light stuff that the OPEC nations hold a control of. The USA has lots of heavy crude that could be used to produce diesel as well as Natural Gas that could be used in a Gas To Liquids program like Royal Dutch Shell has pioneered. Why am I bringing this up on a web site about the GM Volt, because Rick W. the GM CEO has stated the Volt will eventually be made available in a Diesel version as well.
But hey what do I know I am not a Journalist for the world renowned Wall Street Journal jI am just an Engineer not to mention a geek, and a gearhead LOL ! And Someday I hope to be the owner of a Chevy Volt
Butch
April 24th, 2008 at 1:56 am
Even if true, this would still prove a step in the right direction. Inevitably, we’re running out of gas, and all manufacturers will go the way of CAFE. They can sell more cars running on cheaper transportation fuels than Gas driven cars using 100 year old, primitive, fire and heat technologies.
GM would be in the black if they had introduced the Volt five years earlier along with the inevitable knock off cars that would be made by GM using E-Flex today. At least they’re going there. Hopefully not too late to save themselves.
April 24th, 2008 at 5:30 am
Off topic alert…
Lutz interview with DetNews.com he states mules are running with lithium-ion bats.
http://www.detnews.com/apps/pbcs.dll/article?AID=/20080424/OPINION03/804240346&imw=Y
April 24th, 2008 at 5:40 am
That settles it! I had planed on buying a volt but now that I see why GM is making them I think I will buy a 10.0 liter V12 gas guzzler. I’ll show them!!!!
April 24th, 2008 at 5:43 am
It’s gotten to a point that anyone who is a journalist is an expert when it comes to the auto industry. They are very opinionated and know little about the facts. Today, with the web, we readers have to be very careful in what to believe and not to believe. Theirs is so much garbage out there and this article happens to be one of them.
April 24th, 2008 at 5:51 am
People hate GM because they want to blame everything environmental on GM. The movie about killing the car is to blame.
People can’t step back and see that GM has spent more than any other company on EV technology. Tesla, ACPropulsion, Wrightspeed and most other quality EV’s use the technology that was developed by GM in the late 90s. The president of AC Propulsion worked at GM as did key people in most of the EV startups. The variable voltage motor, controllers and software all descends from GM.
Beyond that people want to think they have all the answers. They say that GM is failing because they cancelled the EV-1 and Toyota is leading because of the Prius. The Camry did a lot more to hurt GM’s market share than the Prius. Both the Accord and the Camry brought home just how much quality was missing in GM in the 90s.
GM is doing well and making a profit in countries that allow them to operate freely. They sell small, fuel efficient cars around the world. They’re not failing because they didn’t pursue the EV-1, they’re failing because of entrenched manufacturing and screwed up U.S. regulations that have GM spending more to manufacture cars than their competitors.
This is just another hater that wants to look like he knows it all without bothering to look at the facts and do a little research.
April 24th, 2008 at 6:06 am
The editorial in the WSJ is basically right. When GM sells an attractive high-mileage car like the Volt, that sale will allow GM to sell another more expensive big car or truck, even though it gets lower mpg. The linkage will be good for everyone interested in the Volt, because the linkage allows the Volt to be sold at a low (or even negative) profit margin for a while, because that loss can be offset by a higher margin sale. GM has done a good job getting the Volt underway just in time to allow this possibility.
April 24th, 2008 at 6:17 am
I will take a cheap volt to offset other high mpr cars! No problem here.
April 24th, 2008 at 6:29 am
I can’t wait for my E-Flex Tahoe. With 4 wheel-hub motor at 140hp each I’d pay a $50K premium for one today!
April 24th, 2008 at 6:33 am
I don’t care why GM builds the Volt — I just hope that they build it, and build it, and build it well!
[Rant about poor drivers in Suburbans, deleted, due to irrelevance.]
April 24th, 2008 at 6:36 am
Well, let’s face it, the Volt will definitely help with GM’s overall fleet mileage numbers. Just think if they still had the EV1 as well….they would have great fleet numbers…
April 24th, 2008 at 6:51 am
Although I am a fan of the Volt and the E-Flex technology, I still think pickup trucks and SUV’s are great vehicles. Obviously, many other people do also, as evidenced by auto sales over the last 10 years. These vehicles have one major problem - they use too much fuel.
Let’s not kid ourselves, pickup trucks and SUV’s are here to stay. I can’t imagine a plumber or carpenter trading in his pickup for a Prius or a Volt. I can, however, envision a new line of pickups with E-Flex technology (or other fuel-saving technologies).
The same applies to the “soccer moms”. If they need to haul several kids around, take dogs to the vet, pickup landscaping supplies, and get around when there is a foot of snow on the ground, the SUV is an excellent vehicle. It also can be used by the family for miscellaneous tasks like towing a boat or towing a trailer to Home Depot. Thus the “U” for utility.
Many people will find the Volt does not meets their needs. But that doesn’t mean some of the technology developed for the Volt won’t find its way into these larger vehicles. They will, however, require more energy per mile than the Volt.
With that said, the Volt will help GM to meet its CAFE requirements. However, I don’t think that was GM’s original intent. In January of 2007 the concept car was revealed. Obviously, GM had been working on this vehicle for at least a few years prior to the show to complete it. So the reasons for building the Volt were to showcase a new high efficiency technology, as the new CAFE standards were probably not even proposed at the inception of this project.
April 24th, 2008 at 7:13 am
#10 Mark Bartosik
I just want to point out that it is meaningless to average rates (i.e. mpg). Although (6×10+150)/7 = 30, this is not an accurate computation.
What you really have is 70,000 miles divided by 6067 gallons or 11.5 mpg. I’m sure the CAFE standards will account for this (by assuming every car drives a fixed number of miles per year, like 15,000). This will then equate to an amount of fuel consumption. Like above, the total vehicles times 15,000 divided by total fuel consumption will yield CAFE.
See the weighted average calculation at this link:
http://www.nhtsa.dot.gov/CARS/rules/CAFE/overview.htm
April 24th, 2008 at 7:14 am
No question that cars of this type will have to be sold by GM and others to also be able to market the big ‘gas-guzzlers,’ so there maybe some thinking in this direction.
However, if this was GM’s primary rationale for building the Volt…it is a hideous failure. To offset SUV sales ’standards’ you need VOLUME! What you need is a electric Cobalt, something not necessarily all that great, but cheap…then you can sell a couple hundred copies at and break even every year. I have a feeling if the Volt makes it to market, and GM is still around a ‘electric Cobalt’ would follow by 2015.
April 24th, 2008 at 7:42 am
I don’t see the connection between the Volt and selling more gas-guzzlers. Although I have to admit, I have seen some people on this forum talk of buying other GM vehicles to tide them over till the Volt comes out.
Look, that lame bumper sticker slogan from Plug-in America (I think) actually makes perfect sens. “No Plug, No Sale.” If consumers abide by that, GM (and other manufacturers) have no choice but to make the Volt and other plug-ins. Therefore, I do not see a connection because ultimately the consumer decides. I will NOT buy a new car unless it has plug-in capability.
April 24th, 2008 at 7:57 am
I think that the bumper magnet that Lyle sells here, and that I have, says it all:
MY NEXT CAR WILL BE ELECTRIC
Go Volt Team, GO!!!
April 24th, 2008 at 8:03 am
The CAFE standards are weighted averages.
GM is unlikely to sell 100,000 Volts a year for awhile.
GM had to build SUV’s because their labor rate dictated that to make any profit, they had to sell vehicles for over 20K, the more over 20K, the more they could make. So they geared their entire production and marketing strategy to maximize SUV sales, giving the sedan market to everyone else.
It worked for awhile, but If you look up Lutz’s comments from pre-volt days when he was coming on board, GM changed their long term focus. GM adopted a simple objective–get our product out of the line of fire of environmental problems.
To do that, they had to have a long term plan to get off gas. THAT is why they bought in to fuel cell R and D, and why they continued to play with hybrids. They started all this long before the President told them that CAFE standards were going up, and there was nothing he could do to stop it.
It’s not a conspiracy, and it was not all luck. It just worked out that oil rich countries are addicted to 80 dollar a barrel oil, and that will help GM do what it set out to, years before oil shot up–produce vehicles that don’t use half as much gas, and pollute a fraction of the amount that they did ten years ago.
Which explains the WSJ article. They don’t want to admit that GM might be smarter than they are.
April 24th, 2008 at 8:11 am
Even if this is their “secret plan”, as gas prices continue to climb, how much longer will the public be willing to buy gas guzzlers? They simply will not be able to afford to fill them up and have to consider more efficient vehicles.
April 24th, 2008 at 8:15 am
two thoughts.
As a junior Economics major ive learned that oil kills our trade deficit. I’m supprised that it has actually been reduced recently given the increase in oil. if you hold oil constant our trade deficit comes down much more.
I wasn’t around druing the energy crisis of the 1970’s but i hear they stunk and Americans started buying foreign cars. GM doesn’t want this to happen again.
As much as i hate to say it GM and all other auto manufactures are going to make cars that produce and profit. So the american consumer has the power. If we buy the olt like crazy then GM will but its E-flex drive in other GM cars, the posibilites are huge for GM
April 24th, 2008 at 8:28 am
Dave B (37),
Funny you should mention Plug-In America. I saw the movie, “Who Killed The Electric Car,” and as a proud American citizen, I had been so proud of the EV1 and of GM for having developed it and produced it but so disappointed and mistified when GM (apparently without a trace of a good reason) decide to shelve it. That movie turned me on to the Plug-In America site. Through that site, I learned about this one.
At any rate, their slogan has become my own. “No Plug, No Sale.”
And when you say, “If consumers abide by that, GM (and other manufacturers) have no choice but to make the Volt and other plug-ins,” all I can say is: “Amen!”
April 24th, 2008 at 8:29 am
Whatever the WSJ (or anyone else) speculates GM’s motivation to be for developing the Volt, GM’s technical discovery during the Volt’s development —that vehicle WEIGHT is a much less important factor in E-REV efficiency than once believed— will doubtless lead to more rapid development of high-efficiency E-REV trucks & SUVs than most people originally expected. This is due to both deceleration charging and to brake regenerative charging, which together recover a substantial fraction of even a very heavy vehicle’s kinetic energy. It’s a key reason the UK’s current Commercial Vehicle show includes Smith Electric Vehicle’s trucks of various sizes and capabilities –all electric.
[See…. http://www.autobloggreen.com/2008/04/23/video-all-the-smith-electric-vehicles-from-the-cv-show/
The Cadillac Provoq SUV concept introduced this January with an electric drive train & a 9KWh Li-Ion battery, is designed to operate ENTIRELY in EV-only mode for 20 miles. As I’ve noted more than once in other threads here, simply increasing that battery to the size of the Volt’s 16KWh battery should increase its EV-only range from 20 to 35 MILES! (And this is approximately a 4,000 lb vehicle that could easily accomodate a still larger battery than the Volt’s 16KWh.)
My point is that I hope Smith Electric’s (and other makers) electrification of trucks is NOT going unnoticed at GM. And their own Provoq SUV example is one I keep reminding Bob Lutz, Larry Burns (Head of Global R&D), Marty Hogan (a GM SUV Chief Engr) and others at GM about, to be sure truck/SUV electrification —employing Volt drive train technology— is not neglected or delayed.
…..It would certainly help them meet the new CAFE requirements –whatever the WSJ may think.
April 24th, 2008 at 8:42 am
GM will DEMONSTRATE the truth by the number of Volts it actually produces each year and by the final sales price of each vehicle.
If the number produced is low and the price is high, then GM is using it to manipulate and then comply with CAFE.
If the number produced is high and the final sales price is low (no price gouging), then GM really believes in the electrification of the automobile and all the wonderful things that will do for their company and ultimately the world.
Actions speak louder than words. Therefore (as always) I will watch what they DO and NEVER what they SAY.
Whatever happens, SUV & Light Truck sales will suffer as fuel prices rise. Will GM be so stubborn as to go down with these anchors? It’s their choice and as usual, only time will tell…
April 24th, 2008 at 8:47 am
Does GM want to sell Gas Guzzlers?
I don’t think so. I think they want to sell big SUVs and trucks, and powerful cars. These are currently Gas Guzzlers but with all of them being turned into E-Flex vehicles (hopefully), GM can continue to sell them and make lots of money, while saving their customers gas.
April 24th, 2008 at 8:57 am
Puhleeze… The WSJ is now a Rupert Murdoch tabloid devoid of any common sense, especially on the editorial page. They should know better than most that businesses sell what customers will buy - not the other way around. They didn’t sell hummers and suburbans because they “wanted” to. They sold them because the “could make money on them”. Big car makers have to have a range of products - GM and Ford have stumbled (repeatedly) because they were too dependent on one segment when the market changed. And the key to the US market is watch for oil prices. When they go down guzzlers sell; when it goes up, they don’t. GM needs the volt because peak oil is real, Chinese and Indian demand for oil is real, and the price in the future ain’t gonna be $0.19/gallon like it was when I started driving. (end of rant - I feel better now)
April 24th, 2008 at 9:06 am
Tim I am not singling you out since there are lots of people talking about CAFE, but your post I am using as an example so please don’t take it personally…
“If the number produced is low and the price is high, then GM is using it to manipulate and then comply with CAFE.”
I think we need someone to find a working definition of CAFE because I fail to see how any on these kinds of comments apply unless GM sells an extremely large amount of Volt’s.
So unless they (GM) also improves the whole product line the Volt will have a very small effect if any on CAFE unless I have the wrong definition of what CAFE and averaging is all about. I doubt this because another publication I read “Light & Medium Truck” is talking about this subject and states the large number of “Commercial Trucks” (not products like the ones Toyota builds but the ones Ford, Dodge, and GM build that are driven onto construction sites all across America. Sorry Toyota you have failed to penetrate this market.) will have an extreme impact on CAFE and will force either smaller engines in the form of 6 cylinder power plants on either Gasoline for the smaller lighter duty truck, or a light duty diesel when more power is needed but is still below the requirement of the current diesels which are not typically available in trucks smaller than a 1 ton model.
So I need a definition of CAFE as you understand it Tim or anyone else talking about using the Volt as a bargaining chip to influence CAFE, because I understand it in a fashion that means they have to built lots of a model to have any impact on CAFE as the numerous articles in this other magazine reflects.
Butch
April 24th, 2008 at 9:16 am
What is the authors point?
I never thought Chevy was going to stop selling the silverado, or the Tahoe.
Some people need raw power, i own a Ford F350 Super Duty Dump Body for my company, probably be a while before i’m running that on electric. Hope Ford dosen’t decide to just stop making it because of CAFE standards, they should only apply to individuals, not commercial grade work vehicles. At least until there is a viable alternative, which isn’t even on the horizon.
Why would the author think we care what their motivation is, just build it. Wheter it’s to F*** toyota or to get around the CAFE standards, or to be a founding father of the future of automobiles.
April 24th, 2008 at 9:17 am
We should support GM’s effort to build and sell the Chevy Volt. If they want to continue selling larger vehicles, fine with me. But, they should work towards reducing the fuel usage in all vehicles. I believe GM is doing a better job of that than anyone presently.
We need the Volt on the road faster than late 2010 or early 2011. Let’s hope GM can do so. I want one ASAP and I don’t much care about the color. Just build it and I will buy it.
This site is not the place to “wail” about the WSJ or other political things. Let’s leave the bashing out of this - PLEASE.
April 24th, 2008 at 9:18 am
PS
a small part of the reason i’m buying one is the guilt i feel over the gas guzziling super duty work trucks i own for my company, and the hope i can offset them with the VOLT.
Am i buying one for the wrong reasons?
April 24th, 2008 at 9:20 am
Any reason to buy the Volt is a good reason….
April 24th, 2008 at 9:28 am
I agree with both sides. Everyone knows that CAFE screws with a lot of product. So honestly, it WOULD be in GM’s best interest to build something to increase its corporate average. If GM wants to bribe me to buy a Volt, then I’ll give them my address today. I tell you what, GM-bribe me by selling me a Volt for $31,000 with every sensible option, none of the un-necessary ones, a free replacement battery in a few years and and make it live up to what you projected. Bribe done.
April 24th, 2008 at 9:29 am
Such a frustrating article, and discussion here at times, quite frankly. I have only seen one person here make the CORRECT statement that consumers buy these large,low mpg SUV’s and trucks because THEY NEED THEM! Not that they want them. When was the last time you knew anyone who said, “even though I can make do with a 35 mpg economy car, I think I’ll spend twice as much to get this big SUV that gets 1/3 the mileage and will cost a few thousand more to insure per year?” My answer is NO ONE!
Face it folks, some people need these big SUV’s, like it or not. GM is the only company who has taken the difficult road to help them also, the hybrid Tahoes, etc.; their fleet big vehicle mpg is better than anyone’s, including Toyota. They are always singled out and hammered. I am really wondering how the first E-Flex pickup or SUV will be received? That should be a journalistic riot.
GM has goals and requirements. Making money is a goal. CAFE is a requirement. The Volt will help tide them over until the E-Flex chassis can be put into some of these other vehicles. The Provoq is a great design. At Voltnation, I didn’t notice too many other makers offering anything that large. Again, GM is trying to make cars for everyone, not just the “loud crowd”.
I have made other comments lately about how the Volt will need to be marketed; this article is another example of how what GM says will be moot if the public isn’t willing to be educated about the facts of the car and just take what is written as gospel. This type of misinformation will be a big hurdle for GM to overcome. These marketing issues need to be discussed by everyone at long lengths, over a beer or two. (OK, maybe three…)
April 24th, 2008 at 9:37 am
I know plenty of people who buy large SUV’s because they feel safer driving them or they want their wife and children to be safer. That is one consideration.
Another consideration is some people buy them as status symbols. They equate bigger as better than yours or mine if we are driving a “sensible” car/truck.
April 24th, 2008 at 9:37 am
No one will probably appreciate my opinion on this, but even if it’s true…so what? GM is a company, it operates according to basic laws of supply and demand. if people demand a high-mileage hybrid like the Volt, GM will make lots of Volts. If they want huge SUV’s, GM would make SUV’s. Heck, they made TANKS once, because at the time, that’s what was required. GM has had some troubles with responding properly to the desires of the public in the past, hence the lack of hybrid development up to this stage, but the Volt project shows they have learned and are now fixing the problem. If GM makes lots more gas-guzzlers that’s because it is what people will buy. If you are opposed to them, vote with your money, the ONE thing that GM can not ignore. Pick a color and when the Volt ships, place your order! That’s the sort of input a company has to listen to.
I want either black or green…
April 24th, 2008 at 9:53 am
Generally, I hold WSJ writers to a higher standard as opposed to other media venues, and generally, they don’t fail at producing good, well written articles. I take exception to the sinister light this author is putting GM in. Seems to me, after reading the article, the author needed some sort of controversial fodder to throw out there. I’m extremely glad GM is pursuing making the Volt. So what if they sell large vehicles too? They’re a business just like all of the rest. Toyota sells Tundras next to the Prius on the same lots–where’s the story here?
To GM: Just keep your eye on the ball, and don’t worry so much about what all of the “experts” are saying. Do your best with your products, under-promise and over-deliver.
April 24th, 2008 at 9:56 am
GM already did this with the EV-1. I think the Volt is different in that (unlike the EV-1) it is primarily a market response, not a legislative response. You can’t legislate morality and similarly you can’t legislate technology. The best motivation for new technology is a market advantage and GM clearly sees that electric drive will be a market advantage in the near term future, hence the Volt.
April 24th, 2008 at 9:59 am
I think the WSJ article was a net positive.
How many people reading it thought “What’s a Volt?” or “GM is developing a high mpg hybrid?,” and then Google “GM Volt” to get more info.
For you (us) geeks that check this site 23 times a day, it may come as a surprise that there are many many people out there that have never heard of the Volt.
All publicity is good publicity.
BTW, I had never done it till today, but a “feeling lucky” Google search of “gm volt” drops you right here to gm-volt.com. Congratulations, Lyle, I really think you have become a “mover and shaker” WRT the Volt. I wouldn’t be surprised to learn that many gm employees, engineers and otherwise, are keeping tabs on this site.
I really want a Volt.
April 24th, 2008 at 10:00 am
Ok I just wanted to comment of a few other peoples comments on this thread…
MetrologyFirst.
I agree with you everyone just attacks GM without looking into the details of the story.Thank you for making the valid points about GM having the highest Fleet MPG of anyone and your point about the Hybrid Tahoe is just excellent. Let’s see what Toyota has to compare. Nothing since the Tahoe can tow a lot of weight, and gets 20MPG City! I agree with you that everyone attacks GM and there is an unrealistic perception that the likes of Toyota are better when their large pickups get 13MPG.
Mark..
Thanks for coming to my defense on my rants about the WSJ, and sharing your opinion of Rupert Murdock. I am sure more people than you or I dislike him and doubt his motives as well.
N Riley
Get a life if you think my opinions about the WSJ are political. The comments I made about Wall Street itself might be border line polotical if they weren’t facts you could easily document if you would put down the WSJ, and stop your day trading long enough to see that GM’s long term objectives are what brought about what is clearly a politically motivated attack by the WSJ on GM. Yes GM isn’t a good short term investment which is what irks Wall Street, but look at Warren Buffets opinion of the Automotive Stocks long term. If I had intended to be polotical I could have ranted a lot longer on the sins of Wall Street and I guess that means the WSJ since they cover Wall Street.
I do however agree with one thing you said “Any reason to buy the Volt is a good reason….”
Butch
April 24th, 2008 at 10:04 am
GM has clearly made the decision to move to new technology or be left behind. I think they are smart business managers and will produce what the market demands.
With the Chevy Volt, GM was out in front of the market demand. The real demand is just now coming and will only build because of the cost associated with gasoline and diesel. If GM doesn’t respond to our demand, someone else will. I would much rather it be GM than any other auto company.
Giving all of the history of GM vs other companies, I believe GM has a lot to be proud of. Let them get the Volt out and let the market decide if it is successful. I can not believe but that it will be VERY successful. Just don’t price it out of our reach. Chevy bills itself as the common man’s auto. The common man is going to hard pressed to afford a $35,000 Volt. Unless there are a lot of down side savings (tax incentives, reduced maintenance, fuel cost, etc).
April 24th, 2008 at 10:05 am
. . . black, with heavily tinted windows.
April 24th, 2008 at 10:17 am
Everyone to their own. That is what makes for a viable market. We get to choose colors and options. Thank God for America.
April 24th, 2008 at 10:44 am
Metrology, I’m not trying to start an argument over this, but I see people who drive large trucks and SUVs all the time because they want to - for every person that “needs” their big guzzler, there’s another one who drives it because they want to. As an example, my father and mother own a 3/4 ton diesel truck to pull his 5th wheel (he retires in a few years) and a Nissan Sentra that gets double the mileage. Guess which one my father drives the most? Even though the Nissan gets almost 35 mpg to the truck’s less than 20, he just likes his truck more. My parking lot here at work is full of SUV’s and full size trucks driven by people who just like their big vehicles, and don’t realize that buying a small used commuter car would save them money very quickly in gas savings!
I absolutely agree with you, though, on two items - first, the key for GM is to get this technology ready for all of their vehicles ASAP, because then this becomes a much less important issue. The soccer mom example works great here - if GM could make a full size SUV that got 15-20 miles per charge, then even 30-35 mpg on the range extender, how much fuel could that save for multiple short in-town trips? And second (and more importantly), I really could use a beer or two right now! Time to go out to lunch…
April 24th, 2008 at 10:45 am
I’ll take a subsidized vehicle please. Until then, I think I’ll order a few more magnets that say “My next vehicle will be ELECTRIC” and pass them out at work.
April 24th, 2008 at 11:05 am
i think that this is only obvious that GM is making this in hopes of both sales, marketing and to push their line to the requirements. Ah duh. Pickup trucks are needed for contractors through-out the country and world. We need this vehicle. GM is a company. It can only move just soo fast on design. Things are moving to more hybrids and it takes time. The electricification of the automobiles is 100% gonna happen now. So yes, I think they are doing it to _help_ push their MPG numbers. But also to get sales as the Volt will be a cool car and will sell out probably 100% for a number of years. And those sales area both what the customer wants and GM needs.
April 24th, 2008 at 11:19 am
Jeffrey #66:
No problem, I think you are also correct, there are still alot of people who drive the big trucks because they want to. But to them, the pain at the pump has yet to matter. But at some tipping point they will make the change to the small vehicle sitting at home, if they have one. I really feel for those who do not have the second vehicle to drive and only have the big truck. We have friends with three kids, she is always going somewhere in their Suburban. Hauling them and a neighbor from one game to another. That has to be brutal on gas, but I don’t think she has much choice. It her only vehicle, and the family is too active and too big to use a small car.
Everyone has their own scenario. At some point, even your Dad might say, forget it to the truck when driving around town. But the point I am making is that unless they make a lifestyle change (get rid of the camper), your Dad will always have a big truck. Your Dad may drive it because he wants to, but he has it because he needs one. That’s my real point. An awful lot of people need them. I guess the better question is do they drive them more than they need to.
GM, to their credit, are at least trying to help these folks out with their hybrid trucks and the variable cylinder technology. It is amazing to me though how short sighted some are to dismiss their efforts entirely as insignificant becuase the effort wasn’t focused on little economy cars.
I tell you what, GM, if their smart, ought to be working overtime figuring out how to put their small pickups onto an E-Flex chassis. That will be another level of revolution entirely.
April 24th, 2008 at 11:24 am
By the way, I don’t do arguments. Thats a waste of time. What we do here on this site are good old fashioned discussions. Give and take; trying to understand the whole issue.
That’s why this site is so refreshing. Lyle should be constantly appreciated for putting together this place for reasonable people to interact. Thank again, Lyle.
April 24th, 2008 at 11:36 am
I think Butch articulated a number of good points about Holman Jenkins at the WSJ. I’ve been a subscriber for years and there are good reporters at the WSJ (David Wessel, Greg IP, Walter Mossberg..etc)… but I have found that Mr Jenkins’s analysis and insights lacking over the years on many of his op-ed pieces. As someone who has worked in global product development in high tech for years, have an understanding of marketing/brand management, and strategy it appears to me that Mr Jenkin’s formal training in Journalism hasn’t provided him a good foundation of knowledge on technology, marketing, strategy, product development. I can’t tell what particular skills he leveraged to elevate him onto the WSJ ’s editorial board. Perhaps sounding intelligent or making intriguing obtuse (but superficial or inaccurate) observations about topics he doesn’t really know much about.
Here is his bio from the WSJ:
Holman W. Jenkins Jr. is a member of the editorial board of The Wall Street Journal. He writes editorials and the weekly “Business World” column that appears on the paper’s op-ed page on Wednesdays.
Mr. Jenkins joined the Journal in May 1992 as a writer for the editorial page in New York. In February 1994, he moved to Hong Kong as editor of The Asian Wall Street Journal’s editorial page. He returned to the domestic Journal in December 1995 as a member of the paper’s editorial board and was based in San Francisco. Mr. Jenkins won a 1997 Gerald Loeb Award for distinguished business and financial coverage.
Born in Philadelphia, Mr. Jenkins received a bachelor’s degree from Hobart and William Smith Colleges and a master’s degree in journalism from Northwestern University. He was a 1991 journalism fellow at the University of Michigan”
April 24th, 2008 at 11:46 am
I think that LyleL said it all at #1, and everybody else just built on that.
Who cares what GM’s secret motivations is?
Just build the Volt, the sooner the better!
April 24th, 2008 at 11:50 am
The article obviously was written by someone totally ignorant of the
gas mileage rules. GM can’t “cheat” and exceed those mileage
requirements merely by building a Volt with high mileage. Now there’s a dolt.
April 24th, 2008 at 11:56 am
I notice that the GM’s dual mode truck ads are mentioning the fact that their vehicles get more city mileage than a 4 cylinder Toyota econobox. Gee, a gas guzzling 4 cylinder Toyota.
April 24th, 2008 at 12:22 pm
Another way of looking at it is to understand that it doesn’t matter what GM’s motivations are. If the Volt brings their CAFÉ from 20 to 36, who cares what mix of cars and trucks they are selling. The point is, they will have achieved the goal.
April 24th, 2008 at 12:39 pm
CAFE is weighted by actual sales. The car maker reports on what the avg fuel economy was of the “covered” vehicles sold, and if the average is less than the CAFE standard, they have to pay a fine per vehicle sold. So selling a few subsidized Volts will make a small difference. If you want to know more, the rule is available on the internet.
Jacking your mpg for the entire fleet by 5 mpg would have a bigger impact. Which is why carmakes were given the ability to use flexfuel as a way to obtain an increase in mpg.
April 24th, 2008 at 12:58 pm
This comment just does not make sense. If GM is building the volt to avergae aout the the numbers necessary to be in compliance is one thing. But to think that people would actually still purchase large gas guzzlers in the future when gas can be $7-8 a gallon is just ridiculous. At the end of the day the consumer will be the one deciding. GM is jsut giving a choice to the consumer.
April 24th, 2008 at 1:02 pm
Funny, without even going to the WSJ article itself I guessed it was written by Holman Jenkins. He’s a clown. He wrote a Prius-bash a while back which bungled basic Econ 101 concepts such as fungibility and supply/demand curves. I like to read a variety of viewpoints to see how the “other side” thinks, but some people are just a waste of time.
The WSJ is a good paper (Murdoch has so far been careful to avoid tampering). I don’t know why they keep this guy on staff.
April 24th, 2008 at 1:14 pm
As far as GM building the Volt so it can build more gas guzzlers…
Has everyone noticed that the car companies are already NOT having a problem meeting their CAFE requirements right now? The price of gas has hammered SUV/Truck sales enough combined with the relative increase in sales of vehicles with much better fuel economy so now, GM ’s average fleet economy has climbed… GM is doing it for the reasons Bob Lutz has mentioned.. having products that they think will win in the marketplace by providing an alternative to purely petroleum driven powertrains.. which then provide better energy security, improve our trade deficit, help us reduce our funding of terrorism, reduce our geopolitical entanglements….(and reduce CO2 emissions as an additional positive byproduct)
April 24th, 2008 at 1:58 pm
I normally like to reference my sources but I can’t find these two things I remember. Back when the Prius came out I remember a quote attributed to GM saying that the Prius had WAY too many parts to be cost effective. It is NOT a simple system. GM doesn’t want to build something that complicated. The Volt is attractive to them because it’s going to be much simpler than something like a prius drivetrain and possibly even simpler than current drivetrains, if they keep working on it. The ICE won’t need variable valve timing and all those other emissions/power tricks if it only runs at one speed and you won’t need a transmission. Electric motor/generators are very simple, at least from a parts perspective, which is largely what GM cares about.
On the other hand, I read an article saying that GM had sold very, very few hybrids. 843 to be exact in the first quarter. That compares to, well, tens of thousands for Toyota. And the main reason is that despite having more hybrid models than anbody else, they hardly built any. That does seem to indicate that their current hybrid effort is mainly to increase their corporate average fuel economy.
http://money.cnn.com/2008/04/23/autos/gm_missing_hybrids/?postversion=2008042304
The article goes on to say, however, that GM says it’s just starting to ramp up and expect production in the 40 thousand to 50 thousand range this year.
So, the next couple years are really going to show GM’s intentions out of two possibilities:
1) vast variety of models that they hardly build = CAFE dodge
2) vast quantities built = serious about making money off hybrids.
Either way, it still might not tell you the intention for the Volt since GM may still be looking at EFLEX to ultimately simplify the drivetrain and lower their production costs. Hard to do with such an expensive battery pack, but if they can pay for reducing the cost of the batteries through hybrid programs (notice they’re switching some “conventional” hybrids to lithium batteries) then it becomes very plausible. That would indicate a lot more foresight than GM has had in the past. Maybe being #2 they’re trying harder.
April 24th, 2008 at 2:00 pm
Its an editorial and is worth a measly 2 cents.
April 24th, 2008 at 6:16 pm
From all the comments at Volt Nation, and getting up close and personal with the people responsible for funding and creating the Volt, I can say I thought they were sincere.
They see the danger of America’s dependence on imported oil (read Energy Victory http://www.amazon.com/Energy-Victory-Winning-Terror-Breaking/dp/1591025915). They see the Volt as a way to set America free (visit the Set America Free web site http://www.setamericafree.org/).
I can’t read their minds, but they were the most enthusiastic and patriotically motivated folks I’ve seen in corporate America in a long time when I met them at Javits Center.
Perhaps the most telling comment relative to this question was Bob Lutz explanation of how GM lost its technology image to Toyota because they chose not to lose money on early hybrids and how they aren’t making the same mistake twice.
Volt will be produced and it will be the first wave of a new electrified E-REV architecture that will ripple through the GM brands and turn the company around.
April 24th, 2008 at 6:31 pm
#85 Tom K
I devoutly hope that you are right. God send that it shall be true.
April 24th, 2008 at 6:35 pm
The article is probably correct. Who cares? Build the Volt anyway. One less guzzler is one less guzzler.
April 24th, 2008 at 10:04 pm
Much to do about nothing . GM’s going to build the volt , people tired of putting $300 monthly in gas will have the choice to end the madness forever, Others can buy a H1 hummer if they chose, the US market will pick the winners and losers. I need a beer!!!
April 24th, 2008 at 10:06 pm
If people didn’t buy gas guzzlers, GM wouldn’t build them.
American automakers need to quit being the scapegoat for a population obsessed with consumption.
April 24th, 2008 at 11:23 pm
GM is simply facing something that was inevitable and was going to happen anyway. Hybrids simply made the point that they could sell eco-mobiles with less of everything, and now GM is intending on taking the lead in a market inwhich they had fallen wowfully behind…
It’s all money in-the-end of course, but with politics being what they are, just avoiding the incrementals of legislated requirements, GM is jumping to a whole new set of rules, cutting to the chase imho…
I commend them for it…
April 25th, 2008 at 9:01 am
Bravo, GM I just hope the wind and solar farms continue to expand to supply clean electricity. Also I hope your talking to these guys:
http://www.afstrinity.com/
April 25th, 2008 at 9:22 am
I hope that GM does reap some “extra benefits’ such as MPG compliance assistance… perhaps the more “extra benefits” GM gets, the lower they can price the Volt? Plus they have more incentive to “git-r-done.”
Frankly, I think GM should get serious tax breaks, and/or other financial incentives, and R&D gov’t subsidies as well…our gov’t should be supporting alternative energy solutions on a massive scale - to get us off the OPEC teat… so we can quit sending those arab bastards so much money…someday perhaps we can just leave the ME entirely, and let them implode.
April 25th, 2008 at 11:25 am
If true, I will take the subsidized vehicle and enjoy driving to the beach daily and wherever else I please affordably. In the meantime those that want the heavy duty vehicles can get them.
Kudos to GM for practicing good old supply/demand capitalism! Um..mm, let’s see….. where can I buy more GM stock?
April 25th, 2008 at 2:12 pm
Hey they said the same thing about the Toyota Prius, I bought one in 2003 still have it and would trade it for GM Volt. GM has to start somewhere and the VOLT is the answer and the BEGINNING!
April 26th, 2008 at 6:37 am
To make sure we have the electricity to support electric cars over time it’s way past time to get serious about designing and implementing “cookie cutter” nuclear power plants and replicating them across the USA. France has been doing this for many years with a plant designed in the USA! A “Manhattan Project” style effort comes to mind.
May 3rd, 2008 at 12:21 pm
I just hope they can rapidly expand the technology to include larger vehicles and a commercial fleet. GM needs to move fast or not just the automakers are going to be in deep economic trouble in this country!!!