Wall Street Journal Opinion - Chevy Volt Just a Political Tool
Occasionally an opinion piece is written about the Volt that comes out negative. These are unconventional pieces as the vast majority of journalistic work paints the car in a positive light.
The Wall Street Journal has just published an article by editorial board member Holman Jenkins that was particularly harsh.
The author takes note of GMs financially difficult position and CEO Wagoner’s claim that consumer automotive shifts are not transient but likely permanent.
He writes:
GM’s leaders are not nuts, and yet to pour hundreds of millions into a race to launch an electric car, the Chevy Volt, guaranteed to lose money on every unit sold, begins to seem a peculiar strategy for a company in dire liquidity straits.
He writes “at best, the Volt will be an affluent family’s third car” and contends it wont be usable by city dwellers.
He goes on to attack GM’s claim that the ICE will get 50 mpg during battery charging as “hallucinatory” and makes the “guess” that “the car will be lucky to get 15 mpg under gasoline power.”
He perceives the Volt as having limited flexibility being a 4 passenger car, and derides its environmental benefit claiming use of electricity as a fuel is akin to “playing Three Card Monte with energy inputs.”
Finally Jenkins goes on to make his main point that GM, “justif(ies) the costs and risks of the Volt as a way of changing GM’s image in the minds of consumers and politicians.”, and that “the Volt is GM’s vehicle for making a bailout of GM politically acceptable.”
What do you think?
Source (Wall Street Journal)
Popularity: 5%
(7 votes, average: 4.29 out of 5) 
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July 2nd, 2008 at 10:29 am
Since GM is not the only automaker to go down that race, I guess a lot of them are just playing a political game.
As long as the car is being build I don’t really care about what one journalist have to say, even more when it is more a rant then something carefully researched.
July 2nd, 2008 at 10:31 am
As my mother always says, “Consider the source.”
Next case.
July 2nd, 2008 at 10:41 am
I was going to get all annoyed and post a well reasoned response backed up by research and data. I’ve decided to just ignore this man entirely.
July 2nd, 2008 at 10:43 am
I suppose the WSJ is trying to be “fair and balanced” by having Holman Jenkins on the board. You know, a group of smart well informed business professionals, and then Holman.
Frankly, he must be one of the advisors to Ford, with their PHEV attiude of, wait til someone else does it, let it get popular, and then we’ll work on one.
July 2nd, 2008 at 10:43 am
Two bullet points from the article:
“…and yet to pour hundreds of millions into a race to launch an electric car, the Chevy Volt, guaranteed to lose money on every unit sold, begins to seem a peculiar strategy for a company in dire liquidity straits”
“Never mind. GM executives are not nuts. They justify the costs and risks of the Volt as a way of changing GM’s image in the minds of consumers and politicians. To commit a pun, the Volt is GM’s vehicle for making a bailout of GM politically acceptable.”
That is the heart of the article…and it seems reasonable. The 15MPG part about the ICE was just dumb and takes credibility from the read.
Side note: The Volt probably is an affluent family’s third car, if you can shell $45K for a 4 seat sedan. No one that is honestly hurting from gas prices will be saved by it.
July 2nd, 2008 at 10:43 am
The man knows what he is talking about he RIDES THE SUBWAY EVERYDAY TO WORK. This is proof positive that the educational system has failed. SOME HACK COMES OUT WITH AN ARTICLE AND HE DOESN’T HAVE A CLUE WHAT HE IS TALKING ABOUT. Yes consider the source clueless in New York.
July 2nd, 2008 at 10:46 am
It’s a shame that WSJ does not insist on checking hard facts, even in opinion pieces.
July 2nd, 2008 at 10:47 am
Holman Jenkins thinks he’s pretty smart. Time will tell, but it if he’s wrong he’ll look more stupid than GM does right now. What does he think GM should be doing? Trying to sell the public on existing technologies? Trying to keep sell them SUVs?
Of course GM wants political and PR mileage out of this, but that idea isn’t mutually exclusive from the fact that the VOLT is a good idea whose time has come. I agree that if the VOLT can’t reach it’s benchmarks it may not be a success, but if that is a foregone conclusion, what’s the point of trying anything new!
It’s often prudent to be a bit of a skeptic (nothing new is easy), but I think this guy crosses the line into self indulgent badmouthing.
July 2nd, 2008 at 10:47 am
I would also like to mention, posting a topic like this, then saying “what do you think?” is akin to going to a NRA convention and saying, “Here’s a idea, lets ban guns? How about it?”
Your illiciting a response from a question where the answer is all but assured. You should run for office.
July 2nd, 2008 at 10:53 am
To me this writer sounds like the schoolyard kid who argues something without the facts.
July 2nd, 2008 at 10:56 am
Apparently, the Wall Street Journal is not aware of several things:
1) Petroleum (gasolene) is NOT a renewable resource.
GM is not out of line. They are seeing the handwriting on the wall and wisely reacting to it.
2) There are limited supplies of petroleum and we can already see the end - not now, but coming.
3) The exhaust from gas burning cars is polluting the atmosphere and increasing the greenhouse effect.
4) The exhaust from gas burning cars smells bad.
5) We have to KICK THE PETROLEUM HABIT!
6) The technology for producing electric cars is NOT science fiction. It is doable and doable NOW!
7) The general public is becoming aware of all of the above items and is beginning to look for alternatives.
9) Five years from now we will wonder why we ever used gasolene.
July 2nd, 2008 at 10:56 am
>> (he) makes the “guess” that “the car will be lucky to get 15 mpg
>> under gasoline power.”
Guess again.
July 2nd, 2008 at 10:58 am
I think the guy is smoking something.
A plug free Volt iteration would solve the city/apartment dweller problem and (with less battery) would be less cost prohibitive to us “non-affluent” people.
July 2nd, 2008 at 11:02 am
I haven’t posted in a long time but read this wonderful site every day. I couldn’t pass this one up.
In regards to the WSJ article, my comment is, you have to consider the source!
July 2nd, 2008 at 11:04 am
While the WSJ has some valid points (at $40k and only seating 4, it is not a car for the masses, and city dwellers may have a hard time plugging in)…. the author loses major credability using the old flawed argument….
“…. an EV just moves the tail pipe from the cars to the power plants”
That argument only works (and barely) if the consumer is living in an area where most of the electric power comes from the oldest and dirtiest coal fired plants. Even then it’s partly flawed because just moving the pollution from congested cities to the burbs will save thousands of lives and health problems.
However the reality is that for most Americans, with the current mix, EV’s are much cleaner. On top of that, our power grid is getting cleaner and cleaner every year. It’s easier to control pollution from a few thousand power plants than it is from 100’s of millions of tail pipes.
July 2nd, 2008 at 11:07 am
It’s easy to just dismiss this, because he’s totally lacking in facts and is just spouting some anti-GM BS.
Instead I’d rather break the article apart a bit.
1st point - Volt won’t get 50 mpg on gas, and he specifically mentions urban settings.
Counter: That’s totally wrong, especially for urban settings. One of the largest values of the new batteries GM is commissioning is that it accepts charge quickly. That means that reclamation braking could be set up over 50% and even if the car was hitting mid-30’s it would boost up to 50 mpg with the braking. Counter 2: The car is going to be very small, a four seater with good aerodynamics that will boost the efficiency.
City driving will be MUCH better mileage than highway, no doubts about that point.
The 2nd big point is that GM wants a bailout and this is a way to spruce up their image to the point that they can sway politicians. I think there might be some validity to this half of the argument. I know it’s made me upgrade my opinion of GM.
The last point is that they’ll lose money on each car. 1st, we don’t know that they will lose money. 2nd - even if they do they won’t have to rebuild tooling and manufacturing so the main expense of development will become less with every car produced. The Prius started out losing money and now is a big winner.
This was a frivilous and poorly researched article, even for an editorial, and belongs in an office water cooler chat and not in a major newspaper.
July 2nd, 2008 at 11:07 am
Sounds like someone is shorting the stock… From a high of over 13$ yesterday to 10$ today makes a good case…
July 2nd, 2008 at 11:10 am
Only 10 people answered this so far. Interesting…
I view this mainly as a reaction to GM stock being the lowest it’s been in what, 40 years? WSJ readers are not any different than anyone else…they want to read what conforms to their opinion. And their opinion is that quarterly earnings are more important than long term outlook, and right now GM ain’t got any. So the article is about “throw the visionary under the bus and get back to making ME money. NOW.”
Problem is, the thirst to maintain quarterly earnings is EXACTLY what produced GM’s current stock price, AND the recession we are in. It produced GM’s stock price because they never got off their reliance on big engine cars and SUV’s. And it’s dumped us into a recession because the financial sector got addicted to sub-prime loan returns.
I have no love for Toyota, I’ve never owned one. But the fact that they could make and sell more Prius’s if there were more than 24 hours in a day is, I’m sure, a savory dessert.
here’s the kicker…if oil really is going to stay over 125 a barrel for the next 5 to 7 years, GM will have won the issue. If it’s a bubble and oil returns to 80 bucks a barrel, GM did not accomplish much.
July 2nd, 2008 at 11:10 am
The author’s comment calling GM “… a company in dire liquidity straits”… may not be far off though…
CNBC reports that Merrill Lynch downgraded (from “buy” to “underperform” and setting a $7/share price target) GM today, and their analyst believes GM needs to raise $15B(illion), and that bankruptcy is not out of the question. More info at http://tinyurl.com/69s3lv
July 2nd, 2008 at 11:13 am
From the article:
“With each hectic advance in the development process, the expected sticker price to consumers has gone up. ”
He did get one this right.
July 2nd, 2008 at 11:15 am
I just thought it was funny that he guessed 15 mpg. I don’t see how anyone would figure a 3 or 4 cylinder running only part of the time could possibly get 15 mpg.
July 2nd, 2008 at 11:15 am
Also from the article:
“The company has already started signaling it expects Washington to provide a whopping $7,000 tax credit to Volt purchasers.”
I would rather see the government spend its (my) money this way than on some future war over oil.
———————–
He included a picture of the concept. Gosh that car is gorgeous.
July 2nd, 2008 at 11:16 am
Sure GM has liquidity challenges. That aodesn’t make the Volt the wrong car. It is in fact the right car at the right time — well, maybe 18 months late, but still ahead of the competition. GM has accepted the challenge of finding a way for people to get off imported oil for 40 miles. That’s a great start. 4 of 5 Americans could be all electric with the Volt. The government should be begging them to take money to get the car on the road as an economic and security step.
July 2nd, 2008 at 11:18 am
I have been checking this site almost every day for the past month or so and find it the most current, factual and balanced source for information on electric vehicles and electric storage technology. Lyle, I really appreciate what you are doing here. Keep up the good work.
July 2nd, 2008 at 11:22 am
Given that this guy works for the Wall Street Journal, you would think he might have heard about September 11, and terrorism in general. Hmmm, maybe a car like the Volt would help there.
We will never win the war on terrorism as long as we are paying for both sides.
We need to stop importing oil ASAP.
July 2nd, 2008 at 11:25 am
I would put it to him this way…
“Mr. Jenkins,
Your article failed to mention that over seventy percent of Americans use their cars forty miles or less each day. You failed to mention that, for those folks, stopping to fill up at a gasoline station will no longer be routine. You failed to mention that, with over a half a billion dollars going to the war in Iraq each day, which most folks believe originated to secure our supply of foreign oil, by avoiding future confrontations, the federal government can easily afford $7000 tax subsidies for alternative energy vehicles like the Volt. You failed to mention the expected growth in domestic jobs which will come about as a result of the developing need for large scale production of lithium ion battery packs. You failed to mention that the vast majority of vehicles on the road today contain exactly one occupant. You failed to mention that all new technologies have high startup costs, followed by dramatic price reductions as manufacturing capacity ramps up. Mr. Jenkins, you failed to mention quite a few things that lend clear support to the decision taken by GM executives when they put their company’s future on the line and committed to producing the paradigm changing Chevrolet Volt. Well informed, thoroughly researched, fairly considered journalism, your article is not! Which causes me to wonder if you really believe any of this, or if something else dominates your thinking.”
July 2nd, 2008 at 11:27 am
Third car?!?!? What is this guy, NUTS? This is going to be my # 1 & only car! Sizeable garage wired for power??!? You mean you can put power in your garage, oh man I never knew! This guy’s full of new ideas!!! 15 MPG!?!?! Ya, my lawnmover gets better than that! And with gas going down to $2/gallon by 2010, we’ll all be fine!
Let’s move on to some REAL topics, …. like getting off of OIL!!!
Aaaaw, LOVE that concept look!
GO GM, GO VOLT !
July 2nd, 2008 at 11:34 am
The only people who like change are wet babies.
Take Care
Arch
July 2nd, 2008 at 11:34 am
Wow. This guy might actually be correct.
I took a look at one of Honda’s largest work generators:
http://www.hondapowerequipment.com/products/modeldetail.aspx?page=modeldetail§ion=P2GG&modelname=EB11000&modelid=EB11000K1A
It is rated at 9500W, runs for 4.4 hours at the rated power, and has a capacity of 6.9 gallons. That works out to 41.8 kWh for 6.9 gallons or 0.165 gallons/kWh.
For 8kWh the Volt will apparently get ~40 miles city and ~25 miles highway. To generate 8 kWh with this Honda generator would take 1.32 gallons. That works out to 30MPG city and 19MPG highway.
Can someone check my math and confirm? Anyone know how this Honda generator compares with others in terms of efficiency? ( I checked one of their smallest models and it was about 5% less efficient).
July 2nd, 2008 at 11:35 am
Folks, I strongly suggest folks also post comments on the WSJ article right to the WSJ site’s own comment forum for the article…. http://forums.wsj.com/viewtopic.php?t=3155
July 2nd, 2008 at 11:42 am
I read Mr. Jenkins opinion pieces frequently. In the bigger picture he frequently takes the anti-position on just about any topic he writes about. I think this is his style to stimulate the broader conversation. If you don’t poke holes in your assumptions every once in a while, you could lead yourself astray.
If you read the whole article he takes an economists view of the rechargable electric vehicle. If an ICE generator supplying a battery to drive an electric motor was more efficient than an ICE drivetrain, it would already be in production. I think it just demonstrates that GM still has a great deal of convincing to do both to the car driving public and the investment community.
In my opinion, even if GM is trying to sway favors from the government, the technology and learning they developed from this exercise is valuable. I believe in enlightened self interest!
July 2nd, 2008 at 11:43 am
Alas, GM has gotten itself into a situation where it is damned if it does and damned if it doesn’t.
If it runs out of cash and bellies up before E-Flex becomes commercially viable, it is stupid for wasting the liquidity on this future project.
If it saves the cash and doesn’t do the project, it will be stupid for bellying up a bit later when it has no competitive products to sell in 2011.
Time is clearly running out. I think that Merrill Lynch just sounded the 2 minute warning. As we discussed the other day, might as well throw the Hail Mary and hope for the best. As we always used to say, “Might as well go out in a blaze of glory.”
#22 Rashiid Amul:
Amen brother, preach on!
July 2nd, 2008 at 11:54 am
Like I was saying the other day. GM must be “spot on” when the Volt comes out. No stupid or major problems. Because people like
Holman Jenkins are going to have a field day if there are problems.
I know GM knows this. They talked about it at VoltNation.
But an article like this helps to drive the point home.
Noel #32. Right you are. Damned either way.
July 2nd, 2008 at 11:56 am
Hmmm, so this is the WSJ’s opinion? or at least one of their editorial board member’s opinions….it makes me think of that old saying that compares opinions to a certain area of the human anatomy….
I also wonder what the portfolio of this editorial board member looks like?
July 2nd, 2008 at 11:56 am
$45K? Where did that come from?
Last I heard we were looking at just under $40K, and maybe $5K less with a tax incentive.
July 2nd, 2008 at 11:58 am
Is the Volt just a P.R. tool?
We’ll see by how many are actually made and what GM ultimately sells them for.
I don’t think the Volt is a P.R. tool because GM realizes that if they don’t follow-through on electric cars (range-extended or not)…
they’re dead!
July 2nd, 2008 at 12:03 pm
All this speculation about GM’s fortunes is just that. If GM doesn’t try to do something different it will go bankrupt. So when GM goes bankrupt if it builds the Volt is not a concern. The true sign of madness is doing the same thing over and over again and expecting a different result. With oil in such high demand the writings on the wall for most big gas guzzlers. Again Wall Street points out the obvious but with no solutions.
July 2nd, 2008 at 12:05 pm
Folks, lets not get hysterical. It is an opinion piece. You know the saying… opinions are like &^$%#^ we all have them. I do not believe this will be a plan for a GM buyout. That is just as absurd as the 15 mpg statement. He may have a point about the cost of the vehicle. We need to keep the price in the $35 range or it will be an affluent vehicle and the Prius will win again. The best attack that GM can do at this point is to build the car and bring it to the NYT and give Mr. Jenkins a ride in it to the nearest subway station.
July 2nd, 2008 at 12:06 pm
Of course the Volt is a PR tool. It is also a proof of concept vehicle and a drivetrain and platform that can be ported to every vehicle in the lineup with ease.
The Prius was a PR tool too. Toyota saw a market segment that nobody was doing anything with (ultra environmentalists) and went after it.
As for positioning itself for a government bailout…the government SHOULD bailout GM for a variety of reasons but I don’t think they will at all. For some strange reason we have a terrible double standard in the press and Congress when it comes to Toyota, Honda et al. vs. GM and Ford.
“GM hates Unions! Bad GM! Toyota is the BESTEST!” “What? Toyota isn’t Union and never gets picketed or anything? umm…BAD GM!”
Don’t give me the quality argument either for crying out loud. It took Toyota nearly 10 years to figure out how to galvanize steel correctly in the 70’s and yet we kick in the double standard and give Toyota a halo and we rip GM for QC issues that occurred in 1960.
July 2nd, 2008 at 12:07 pm
#33 Rashiid Amul
Yep. They have got to nail the technology with reasonable performance to start, and then have a road map to improve it.
Here’s the thing: you’ve got to start somewhere. The technological investments that GM makes on the Volt will not be lost. They will have figured out a lot of things that will help their entire hybrid portfolio going forward, from their mild (BAS) hybrids and their two-mode hybrids to their series hybrids. It also prepares them for a future where hybrids will be much more prominent. If, for example, the latest work on direct methanol fuel cells can be commercialized successfully, then GM is poised to make use of it.
There is a bit of a gamble in this; they are somewhat at the mercy of oil and electricity prices and the whims of the market. But if you say GM is crazy, I’d say they’re crazy like a fox…
July 2nd, 2008 at 12:16 pm
Alot of financial viability talk going on. The market certainly believes which way GM is headed.
Another low of the low set today, currently:
$10.45 - $1.30 -or- 11%, yield is almost 10%
July 2nd, 2008 at 12:20 pm
Its clearly time to flame this WSJ elitist. 15 mpg under gasoline mode? He clearly fails to understand this tech. Lets all take a minute out of our day to send him and educational email… Hows about the story of Lutz’s driving the mule car with 40+ mile battery range?
July 2nd, 2008 at 12:27 pm
Holman Jenkins has offered the first plausible explanation I’ve seen that explains why a company in dire liquidity straits (yes, they really are, the WSJ tends to get that sort of thing right all the time) would be pouring money into a project that, BY DESIGN, will not produce any significant profit before 2013 AT THE EARLIEST. This also explains the “openness” around the Volt development.
They are setting the stage for a handout, so that DC will have a reason to keep GM alive. They’re going to have to ask for more than a “loan guarantee,” like Chrysler did. They’ll be asking for much, much more. This also explains the nonsense about getting utilities involved in using the Volt for temporary bolstering of the grid. They’re doing all they can to maximize the “constituency” of the Volt and, therefore, backers for the GM handout.
15mpg in extended-range mode? It will probably do better than that but probably not more than 45mpg. Perhaps as little as 40mpg.
July 2nd, 2008 at 12:28 pm
We are in the midst of a very big political shift. Mr. Jenkins opinion obviously is seated in his investments in the oil industry, as many people are, GM needs to push ahead without delay. The politics of “business as usual” will only leave us further dependant on old and dirty technology.
July 2nd, 2008 at 12:29 pm
RE: #29 GXT
could you post how you got those numbers? I would love to check your math for you, but without anything to go on its a bit tough.
July 2nd, 2008 at 12:33 pm
Wallstreet Journal? Isn’t that susposed to one of the bastions of libral thinking?
Obviously the author of the article has his head so far up his …………. anyway, who cares what he said. It’s really not worthy of print and certainly not worthy of debating on this forum.
July 2nd, 2008 at 12:40 pm
Interesting quotes from the article:
“Secondly, any forecast calling for a “permanent” shift in auto tastes based on a quantum as volatile as the price of gasoline is nuts.”
Wow.. so it is WSJ-s sure bet that oil/gas prices are going to come down? As if suddenly there would be abundance of new easily accessible (i.e. cheap) oil-drilling locations available? And ..ahem.. no global warming thanks to burning too much fossile either?
Last I checked across the Asian (never mind the African..) continent three things were happening - a) population increase and b) move towards industrial societies. c) gasoline sold to consumers at SUBSIDIZED prices. Yes, subsidized as in below the market value. Compensated by special arrangements from other public resources - they supposedly do that to avoid mass-riots…All the biggest - China (where gas is cheaper than in the US, never mind the Europe), India, Malaysia do that and they spend billions of dollars on these subsidies annually and no, there’s no end in sight to this policy.
I suppose all that comes as a revelation to the WSJ and..ahem.. despite all of the above , the oil prices will drop, right?
Why is WSJ publishing such nonsense?
Have they perhaps had too big slice of the Big Oil pie for lunch?
July 2nd, 2008 at 12:41 pm
Statik #5. Don’t you think we ought to hold off on pronouncing this an affluent buyers car? I’ve been lurking on this website for nearly 6 months now and have digested a great deal of good and well thought input, a lot from yourself I May add however, it’s not been written in stone (yet) what pricing will be, only speculation and even GM has been playing with the proposed pricing I suspect to throw competition off the scent.
So the 45K you stated is only a WAG.
Even if it were to be as expensive as some have proposed it won’t be for long. Battery technology is evolving rapidly and with that prices will follow.
C’mon, be a sport, try and put a positive spin on some of your inputs. You generally have good points and for the most part quite informative but you are for the most part terriblly negative:)
July 2nd, 2008 at 12:42 pm
This article is tantamount to the barnyard practice of chickens pecking at a bleeding member until its demise.
July 2nd, 2008 at 12:44 pm
You know criticism like this from such an elitist globalist paper should be a badge of honor for GM. Maybe these neo-cons are afraid the public thinking will change. That we don’t need to be so panicked over maintaining our access to oil and fight these ’stability’ conflicts in the Middle East. Maybe they fear a public back-lash.
‘How could you have spent so much money in Iraq to accomplish next to nothing when we could have bankrupted our enemies with the money by buying every one a Volt?’ Not to mention the jobs we’d create, the balancing of our trade deficit and inventing the tech to allow us and our trading partners to live up to the Kyoto treaty. I think the powers that be really fear change and innovation. They see their power and their World Power Balance models being attacked. They are desparate and don’t know what to do so they spread lies and falsehoods. We need to stand up to this and keep preaching to the public the wisdom of the Volt project.
So the car might be more expensive than the gas it saves. yeah, but the price of gas has a huge socialized cost with all the war, pollution and despotic regimes it finances with our own money!
There’s clearly more at stake here than just gas mileage and bailouts. How much would a GM bailout cost now that they are on track to solving the problem and making the world a better place? A few billion? Thats a joke of an amount of money in Washington these days. They spend that in Iraq in one month.
We know where this author and where this paper stands: status quo, Welfare/Warfare statist.
July 2nd, 2008 at 12:48 pm
I found a follow-up article on Mr. Jenkins article published by Businessweek, where the author attacks Jenkins assertions
WSJ Attack on Chevy Volt—-Shocking
Posted by: David Kiley on April 23
Holman W. Jenkins, Jr. writes a pretty tedious editorial in The Wall Street Journal today, suggesting that General Motors is wrong-headed for developing the plug-in Chevy Volt.
Holman W. Jenkins Jr. does make one reasonable point. The Department of Transportation’s announcement that automakers will have to boost fuel efficiency in their cars and trucks by 4.5% a year until 2015, is subject to change by a future Congress and White House if automakers can’t get there, market conditions and oil prices changes, etc. There are a host of things that can happen between now and then to move the goal posts.
But here is where Holman W. Jenkins, Jr. loses me. “America’s biggest near-dead car company called in reporters this month to boast – boast! – about its willingness to lose money on its forthcoming electric car. That includes betting the farm on whether batteries can be developed with the necessary power-to-weight ratio and life expectancy to give the car its needed usability. “Whatever it takes to do, we will do” to deliver the plug-in Volt by a 2010 deadline, project leader Frank Weber told journalists.”
The scientists I have interviewed over the past few years tell me that not only is the technology within reach, but that it makes too much sense not to pursue with gusto. Do costs have to be brought down? Yes. But never has an application of technology come along that so perfectly matched the peculiarities of the U.S. driver. The plug-in is designed to run between 40 and 50 miles on an electrical charge. If you have to go a longer distance, an engine that kicks on to recharge the battery will get you there. It takes the nervousness of running out of juice out of the mix.
Honda doesn’t see the market for plug-ins. Okay. But Honda have us the awkward looking Insight to answer the Prius, as well as the Ridgeline pickup and the Element. Honda’s read of the consumer desire side of the busines can be off.
GM sees the Volt and its plug-in siblings as a new lens through which the U.S. and world will view the company—if it gets the products right and delivers. But fault the company for over-spending on breakthrough technology? Why? GM has gotten management decisions wrong plenty of times (linking with Italian automaker Fiat before its financial renaissance comes to mind) They have also gotten product decisions wrong plenty of times (see: Pontiac Aztek, Chevy Outlander and Saturn LS to name a few.).
A financial and management commitment to bring a game-changing technology to showrooms is hardly something to criticize. As Toyota has proved, the presence of the Prius in showrooms and in the papers makes even its thirstiest gas suckers like the Sequoia and Tundra appear greener than GM’s vehicles even when they aren’t.
More from Holman W. Jenkins, Jr. “For some number of dollars, GM can afford to bribe consumers to drive Volts off the lot…”
GM is betting that there will be early adopters, as well as government incentives to help consumers buy the new technology…just as there were for the Prius. GM opted out of hybrids in the 1990s because it rightly saw that gas-electric hybrids were an inelegant engineering solution for higher fuel economy. It made a bet that hydrogen-powered cars would come along faster than reality tells us now is the case.
Yes, it’s a bit of a roll of the dice for GM. And it’s unlike the way the “near death” automaker Jenkins describes has behaved in the past. From my vantage point, it looks like GM is taking in the political reality that we will never have European-style gas taxes to drive demand for smaller vehicles, so it is trying to one-up Toyota on the technology front. If GM falls on its face in the execution, we can all write that story. But to pillory the company for trying? What for?
Regarding Ethanol
“Finally, there is the new Satanism school. Writing in the Wall Street Journal columnist Holman Jenkins recently accused me personally of “surrendering [my] soul upfront” and “rushing into a devil’s bargain” by praising the use of ethanol rather than oil products, and then again that “Satan will insist on his due” even if though I urge moving from corn to cellulosic biomass as a feedstock. I was really shocked at this allegation - not about me, since I would honestly have to plead guilty to at least second-degree ethanol support, but I was surprised to see Mr. Jenkins link the Devil to ethanol, even outside the context of excessive recreational ethanol consumption. So I communicated to Mr. Jenkins that I had given him a call and the Devil had assured me that it wasn’t true: “I’m totally,” he said, “invested in geothermal.”
Idiots like him should be prevented from commenting on new technology
July 2nd, 2008 at 12:53 pm
The guy is a moron. No hard facts to back up his “opinions”, just loose canon rhetoric and shrill nonsense. Considering the source, it’s no wonder I don’t subscribe or read the WSJ. Next intelligent conversation please???
July 2nd, 2008 at 12:54 pm
He writes “at best, the Volt will be an affluent family’s third car”
It will be our first car & we are not affluent. We have a fixed income, but we’ll come up with what we need to get a Volt.
The trouble with opinion pieces is that some readers take them as truth. The 15 mile per gallon thing, for example. How many highly educated people who read the WSJ & base their car buying decisions on other biased publications (Consumer Reports comes to mind) will believe this statement to be accurate?
July 2nd, 2008 at 12:55 pm
When he says it won’t work for urban dwellers, what he means is that you can’t park it anywhere in Manhattan with a wire out an apartment window to the street without it and the car suffering a minimum of eleven acts of vandalism per hour as long as it’s there.
Meanwhile, let’s all try to remember that NYC is trying to bill itself as a soon-to-be “green” city!
For the Volt, the “first case” is likely to be the “worst case” in terms of cost. The “third car” comment probably does describe the fate of the first 10,000. If costs don’t fall by 2013, he could be right overall; but I don’t see that they can help but fall. We’re talking about a new industry to build batteries on this scale. Once it ramps up to high volume, it will take a lot of work and chicanery to keep the pack prices high.
This is a somewhat flawed analogy, but I recall seeing the first electronic calculator (as we think of them today), featured in a magazine article; it had been virtually hand-made in a laboratory for the Apollo astronauts, and cost thousands of dollars. As a child at the time, I thought; “how cool would that be to have for Math class,” though at the time, I might as well have wished for my own space capsule. Within 10 years, I was getting a miniature version from an office supply store, free with a promotional coupon! Sometimes when you pull the lever, you do get a jackpot …
July 2nd, 2008 at 12:55 pm
Well, hopefully the government will bail GM out and put the motherload of strings attached to the bailout: E-REV on all vehicles under XXXX weight by 201X and two mode hybrid on all vehicles over XXXX weight by 2011.
The fact of the matter is we are probably the ONLY country whose government does not subsidize directly or indirectly its automotive industry.
July 2nd, 2008 at 12:58 pm
I posted a reply and was going to post it here but the comment hasn’t been approved yet so I can’t yet post it here as well without retyping. Basically I mostly wrote about the 15 mpg part of his article and how the article is closer to slander than anything else.
But all this talk about 15 mpg has got me thinking. I posted on here a long long time ago that the E-Flex system does not depend on large batteries. Who here wouldn’t today want a Volt if it only had a 2KW battery! If that car was on the market right now it would be the best car available right now!!! Who wouldn’t want a car for less than 30K that gets better milage than a prius. It would be the highest milage car you could buy or possible would get only as good a milage as the prius. But either way their is a waiting list for the prius so the Volt with the same or better mileage would be pulling in some serious bucks for GM.
I think I am the only one on the plantet that realizes this.
GM needs to move all of their vehicles to the E-Flex drive train and add larger batteries various production lines in the future as they become available.
I hope that GM has plans to do just this and is waiting on doing it for the same reason they are limiting production of the volt initially… which is probably because of fears of huge recalls that would cripple the company if the recall numbers are large. Hopefully they will have the assurance of the drive trains durability soon and the conversion of all their vehicles can begin soon.
And think about it you buy your E-Flex car or truck from GM with a 2K battery and the upgrade to a 16K or whatever size battery you want requires virtually nothing more than the battery and the controller to recharge it with. Upgrade companies would be popping up like the $10,000 dollar upgrade available for the prius.
This would be an immediate boom for car and truck sales for GM. Just do it!!!!
July 2nd, 2008 at 1:07 pm
The key point of the article as identified by Statik is
“GM executives are not nuts. They justify the costs and risks of the Volt as a way of changing GM’s image in the minds of consumers and politicians. To commit a pun, the Volt is GM’s vehicle for making a bailout of GM politically acceptable.”
The author is correct. GM executives are not nuts. GM is looking for government support, and such support requires a different image arising from a different reality. GM’s plan is rational. The invisible hand does not require pure motivations of those at GM, for we all will benefit from the Volt.
15 mpg with the ICE on is incorrect. Perhaps it is simply a typo.
July 2nd, 2008 at 1:11 pm
Holman Jenkins OBVIOUSLY didn’t do much homework on the Volt and the new technology behind it. The Volt was probably just another story his editor had him do. He probably researched it for a half hour on the internet, talked to a few people in the newsroom and then published what he thought.
The dude just doesn’t know what he’s talking about. Not even worth trying to argue with a guy like that. You’d just be educating him on things he should have done himself before he even wrote the story. The people who wrote the Atlantic story really did do a good bit of homework on the Volt in their story: http://www.theatlantic.com/doc/200807/general-motors
July 2nd, 2008 at 1:13 pm
#48 250Volts
“Statik #5. Don’t you think we ought to hold off on pronouncing this an affluent buyers car? … what pricing will be, only speculation and even GM has been playing with the proposed pricing I suspect to throw competition off the scent. So the 45K you stated is only a WAG. C’mon, be a sport, try and put a positive spin on some of your inputs. You generally have good points and for the most part quite informative but you are for the most part terriblly negative:)”
It’s true if the over 40K price is just a big bluff, the ‘non-affluent’ might get into it. (Over 40K is for the affluent, 95% of new autosales are under this price point). I don’t think the pricetag is a WAG though. Suggesting that GM is ‘pulling a fast one’ might be.
As for being mostly negative…I plead guilty.
I’m not really the type of guy that puts ’spins’ on things either. (=
However, I think my negativity has something to do with everything being negative. This is a bad, bad economy we are in right now and declining, and GM is a company in that economy that is in bad, bad shape. (I used bad twice in those references because of my negativity…the second bad is clearly redundant, hehe.) ((Then I added the ‘hehe’ for levity))
July 2nd, 2008 at 1:16 pm
There are a lot of good points here. #16 Greg Woulf may sum it up the best when he says that Jenkins is wrong on the facts but makes a good point about the political finance deal.
I don’t see what’s so negative about using good technology in order to obtain government incentives. Every company wants a handout. Bear Sterns got one. Private Equity gets one. Alternative energy companies get one. These don’t bother me so much (maybe the private equity) as the ones that are really evil, like Archer Daniel getting a tariff on sugar cane ethanol so it can jack up the price of its corn ethanol. Or the crazy policy of building roads into national forests that cost more than the timber sales. Those hurt people and our national interest and cost the taxpayes money all at once without providing a corresponding societal benefit.
The point would be that it’s perfectly rational to provide incentives if it makes sense. If GM has a promising technology that will cut our dependency on oil, thereby letting us out of the Middle East and allowing us to stop funding terrorism, then I fail to see why we wouldn’t provide an incentive. For the $24B/Month we’re wasting now on the rat hole we call Iraq we could buy down a lot of the price on a lot of VOLTS.
What would be so terrible about that?
#29 GXT
You raise a question how much electricity will be needed to power the VOLT and question whether the claimed mpg is unrealistic. You may be overestimating the power needed to drive the VOLT. Here is a quote from the Poulsen Hybrid site. Poulsen is an entrant in the Automotive X Prize contest. They’re of interest here because their system consists of a very small battery that hooks directly to hub motors in two wheels. It works because you need very little power to run the car directly (the other way to look at this is that the ICE in a car engine is unbelievably ineffecient):
“The development is based on the observation that only 10-15 horsepower is required to propel a compact or mid-size automobile along a level road at a steady 60-70 mph. leading to the conclusion that this relatively small amount of electric power would be able to cope with 70-85% of normal driving, only aided by the combustion engine during start up and when extra energy is required for acceleration and hill climbing.”
Trains use the generator/battery/motor combination because it’s the most effecient method available. I don’t see why it’s a shock that it would be effecient in a car.
July 2nd, 2008 at 1:19 pm
#56.
Omegaman66
i recall the volt has an 85 kw motor. you can’t run a series drive on a 2kw stack. It won’t put out the necessary amperage. You’d need a 5kw prismatic stack that operates at 480 volts and the least. This stack would probably weigh about 300 lbs, and would require one heck of a complicate control circuit.
I don’t know that any one has ever built a NIMH stack with many cells (i’ve not heard of a large format prismatic)? It would be just under half as many cells currently contemplated in the Volt 40. So who says it could really be done for $30K. But granted, maybe worth a try.
But, if you look carefully, GM is betting on LION prices eventually achieving near parity with NIMH. From what i;ve read i don’t see why that won’t happen. The tests i read about the new Large Format LiFe cells has the retail costs down to $0.80/Wh. They have good heat tolerance and and better cold start ability than NIMH. If managed properly the manufactures claims 2k cycles @ 70% DOD. Who knows if those numbers can be trusted, but with competent manufactures like LG throwing serious bank and engineers at the problem, i wouldn’t be surpised if by 2010, they’ll build a Volt stack + controller for under $10K which meets the criterian and then some. I am a seller of A123 winning the volt contract by the way.
A123 tech would make more sense in a LION Prius as their pulse power stats are second to none, but they haven’t proven themselves on cost or large-format. Their M-series cells are a perfect match for HEV market. Oh yah, and i think they took a few extra months to deliver a working stack to GM, right?
–
DA
July 2nd, 2008 at 1:20 pm
I had actually wondered how the lunatic-Left would demonize the Volt. I knew that someone with a liberal leaning would, even though I couldn’t quite figure out how.
Zero pollution for the first 40 miles seems like a no-brainer (but electricity comes from coal! Waaaah!) But electricity can be made with Wind Power, which is projected to provide 20% of all US electrical needs by 2030; and there are new Solar breakthroughs almost weekly. Coal plants will likely be forced to “sequester” CO2 emissions. The Volt still seems like a cinch for the Global Warmists to take to (and I’m frequently amused when I see them trying to figure out why most people here never show up for Sun Day school).
The batteries don’t contain toxic materials (like NiMH, or Lead-acid, for that matter), and in any case are fully recycleable; so there goes the rest of the environmental objections.
“Too expensive, except for the rich!” That wouldn’t stop a surprizing number of elite liberals, for whom money (especially ours) appears to be no object. How much electricity did Al Gore use last year? And in any case, the technology’s costs will drop.
So what could possibly be left for a good liberal to object to?
With all the obvious things easily answerable, that still leaves a glaringly obvious one: the Volt offers hope for an America which is not continually diminishing to a point where it can no longer influence world affairs. This is one thing that the hard-core Liberal (or Environmentalist) cannot allow. You know. Because the US is so EEEEEEEEEEVIL!!!.
At the hardest core of liberal-environmentalism is a hatred of industry, economy, the US, and even Humanity.
July 2nd, 2008 at 1:25 pm
Jackson #62. You really need to be less full of vitriol and rigidity. You paint everyone left of center as if they are evil. You use a brush so wide that you eliminate half of the country….at least half. You make it sound as if liberal leaning is a bad idea. The other word for liberal is PROGRESSIVE. Progressives believe in moving FORWARD, not standing still with the status quo and shooting to everyone that everything is okay, when clearly it is not. You can bet far more progressives are for the Volt than are conservatives IMHO.
July 2nd, 2008 at 1:25 pm
I am really surprised that the WSJ editorial staff didn’t stop him from making a 15 mpg claim without backing the statement up.
If I were GM, I would consider legal action against WSJ for libel.
July 2nd, 2008 at 1:31 pm
#29 GXT
Sorry I left off some rough calculations. If the ICE engine in the VOLT has the same effeciency as the honda engine you’re referencing, then it could power the VOLT for 4.4 hours at a speed of say 60 mph using 6.9 gallons of gas. This means we’d be looking at something along the lines of 40 mpg highway rather than your estimate of 19 mpg. That’s consistent with the early information that the VOLT would have a cruising range of 640 miles on a standard (16 gallons?) tank of gas.
July 2nd, 2008 at 1:34 pm
#56 Omega
I think alot of us are thinking that. Actually we just had a whole long post about “Should GM get into the ‘high-efficiency hybrid’ business”
Truth is, GM missed that boat, they admit it too. Rather than trying to get onboard as quickly as possible, they have decided to try and circumvent their problems of today and slip right into the future.
If you accept that GM will go bankrupt. and you also accept that they think so too, it is not a bad plan.
Honestly, they should probably still be doing work on the economically viable, under 30K, ‘hybrid thing’ as well. But maybe they figure the XFE badge on the Cobalts/Pursuits-G5 today, and then the new turbo 4 into their cars will be enough to connect the past with the furture.
July 2nd, 2008 at 1:43 pm
45 Egineer,
Well I would prefer if someone else did it from scratch, but here is my reasoning.
Generator info from Honda website:
rated power: 9.5kW
fuel tank capacity: 6.9 gallons
Run time per tankful: 4.4 hours at rated load
9.5kWh * 4.4h / 6.9 gallons = 6.058 kWh/gallon = 0.1651 gallons/kWh
Volt Specs:
Battery Size: 16kW
City Range: 40 miles
Highway range: 25 miles
Electricity used before generator comes on: 8kW
To generate 8kW with the Honda generator would take 8kW * 0.1651 gallons/kWh = 1.321 gallons
So 40 miles @ 1.321 gallons = 30.3 MPG
and 25 miles @ 1.321 gallons = 18.9 MPG
July 2nd, 2008 at 1:44 pm
Kevin R
Yes, I think 50/50 is about right, and both sides are about equally brushed. If you don’t believe me, look at where the country falls politically.
No, I probably shouldn’t troll-bait like that. But I do get tired of actually seeing only one side expressing itself.
If we really want to throw civility to the winds, I think it might be interesting for all to see how Volt interest on this site shakes out, politically, maybe on a click-poll (one click per screen name). I think a lot of people would be surprised.
A great strength of the Volt is that it answers so many people’s needs/issues without exclusivity. Want to stop funding Mid-East Oil? Volt can help. Want to limit CO2 emissions? Volt can help. Want to save American industry? Volt can help. There aren’t many things out there which has so much “Win” for so many points of view.
July 2nd, 2008 at 1:45 pm
62 Jackson:
What’s evil is the way you’ve managed to take this fluff piece and turn it into a diatribe against “liberal-environmentalism”.
What makes you so sure that Holman Jenkins is not a neocon in the pay of Big Oil?
And what makes you think that you’re not the troll in this scenario?
July 2nd, 2008 at 1:47 pm
65 DonC,
I would appreciate if someone else could confirm, but I am pretty sure that it is a known fact that the electric ranges that GM is talking about for the Volt are the result of 1/2 of the Volt’s battery being used. That would mean that the 8kW is accurate.
July 2nd, 2008 at 1:48 pm
I failed art class in high school, and get paid by energy engineers for efficient systems regardless of aesthetics.
Therefore, I qualify myself to say that the Mona Lisa is the ugliest painting of all times and guess it would get about $15 dollars on the open market because the cost of oil is at an all time high.
July 2nd, 2008 at 1:56 pm
Mein Green
To answer your question, “What makes you so sure that Holman Jenkins is not a neocon in the pay of Big Oil?”, I’ve learned that nothing constructive ever follows the word “neocon” in a post.
To answer your charge, “And what makes you think that you’re not the troll in this scenario?”
I’m sorry.
July 2nd, 2008 at 2:03 pm
Mr. Jenkins,
Your opinions are a great example of the short-sighted arguments that have led to our current fuel crisis. However, the facts on the ground are changing. Your theories on pricing and economy are all based on current fuel cost, current emissions and current thinking.
You mention that families are still willing to buy large vehicles. You repeat the argument that electricity can be more ‘dirty’ than gas, you question the efficiency of an onboard generator. Providing that there were no technological advances and consumers preferences didn’t change, your assumptions might be correct.
However, consumers are changing their habits. Just search “SUV Car Sales” on your own paper and you’ll see that consumers are changing. This is not just a recent switch, Hybrids have been doing well, and many consumers are waiting for the car they ‘want’ to be released as a Hybrid. I personally don’t see this as an endorsement of ‘Hybrids’ as much as an endorsement for change.
Technology is also changing, with $4 gas, industry and investors are all scrambling for a piece of the alternative energy ‘pie’. It’s also possible that with higher gas prices, we will see a public warming to a return to ‘nuclear’. Better batteries, motor, generators are all on the horizon. How much better remains to be seen. Where we end up is a guessing game.
The primary benefit of the ‘Volt’ is that it doesn’t really care where the electricity comes from. It can come from an outlet (coal or nuclear), it can come from a generator (Gas, Diesel, Ethanol, Vegetable oil, hydrogen). It could come from the sun or a lightning rod if you’re lucky. While the first version of the Volt is planned to be gas, it just a matter of changing out the generator to convert to newer technologies. Current Hybrids are well tuned machines relying on the engine for the heavy lifting; they can’t be easily unplugged and ‘swapped’.
As battery technology increases, you will be able to unplug your old batteries and replace them with newer, lighter, cheaper alternatives.
You dismiss the idea of the onboard generator as being ‘inefficient’. You suggest that the feature is not valuable, because you ‘guess’ it will only get 15 miles to the gallon. Well, my research in the subject suggests that 20 miles would be the worst case scenario for an extremely inefficient system for a car of the Volts weight in heavy driving. I think creating a car that hit 40 miles per gallon, would be pretty darn easy.
Still the efficiency is not really the point of the generator. The generator removes the ‘compromise’ factor of the electric car. Consumers worry about not being able to drive their car, because it’s out of charge. They won’t buy a car that they are afraid will strand them. The generator serves as a ‘safety’ net. It also allows them to plan the yearly trip to grandmas knowing that their family car will get them there quickly and reliably.