GM-VOLT : Chevy Volt Electric Car Site

Rather than oil companies, electric cars rely on electric utility companies to supply them with power. Not only does this give electric cars the advantage of running on home-grown domestic energy, but can offer a considerable cost savings over gasoline.

Utility rates throughout the country vary anywhere from 10 to 20 cents per kwh, which would allow the Volt to travel 40 miles on from 80 cents to $1.60. Some regions over lower overnight rates, as there is often excess production caapcity at those times, and cannot strain the grid which may be at or close to capacity during daytime hours.

Detroit Edison (DTE) has announced it is the first utility company in the nation to offer EV owners special electric car rates, after receiving approval from Michigan regulators. DTE is Michigan’s largest utility company and will provide the low rate and other incentives to up to 2500 customers though 2012.

EV owners will get a free 240-v charging station, dedicated meter, and $2500 towards the cost of installing the station. Owners will then pay either a low nighttime rate, or a fixed $40 per month. The company is considering the program an experiment to determine what pricing structure is most appropriate for EV owners, and to examine the effect of EV charging on the grid.

“We view — as do a lot of people — electric vehicles as something of the future,” said Edward Falletich, manager for pricing at Detroit Edison. “What this does is let us be privy to how much power is used to charge a vehicle.”

“We need to better understand the customers,” he said. “We just have very little information on electric vehicles.”

DTE has been working closely with GM to develop this program. “We’re seeing utility companies like DTE take a progressive step to incentivize people to drive electrically,” said Volt spokesperson Rob Peterson. “They give customers more reason to go out and test-drive an electric vehicle.”

These 2500 free chargers are in addition the the already announced 4400 free chargers Volt customers will be eligible for through DOE supported programs from charger companies Coulomb Technologies and EcoTality.

GM is expected to announce its Volt charger installation partner shortly.

Source (Detroit News) and (Detroit Press)

The first batch of Chevrolet Volts will be in very limited supply and highly sought after. As a result, individual dealers have the opportunity to make a few extra bucks by marking up the price beyond the MSRP of $41,000. They can incorporate that extra profit into the lease price too.

GM has sent a clear message to the so far 600 Chevrolet Volt certified dealers that it does not want them to mark up the car. There is already an $1800 profit for the dealer over invoice.

Despite these factors, according to a GM-Volt poll, more than half of Chevy dealers are marking up the cars, some even going to far as to charge $20,000 more than MSRP.

AutoNation is the nation’s largest new car dealership chain. The company owns 230 dealerships in 17 states, which includes 27 Chevrolet Dealers.

Marc Cannon who is AutoNation’s head of communications told Edmunds.com his company has issued a strict memo to its Chevy dealers.

They were told that no Volts may be sold for more than MSRP. Any dealer found to be increasing the price will be subject to immediate termination.

There are no reports of Nissan dealers planning to jack up the price of the LEAF, and some have even been reported to be willing to sell it below MSRP.

Challenge: Who will be the first Chevy dealer to step up and offer a Volt below MSRP?

Source (Edmunds)

Here we are once again standing agape watching yet another executive take the helm as Gerneal Motors’ CEO.

Daniel Akerson will take over from Ed Whitacre on September 1st. He has been a member of GM’s board since June 2009, and actively involved in decision making. He has a track record of leadership, formerly serving as CEO of XO Communications and Nextel. He is said to have a hard-driven no-nonsense management style and an extensive financial background and business acumen. Like Whitacre, he has no experience in the auto industry. He was placed on GM’s board by the US government, after it took 61% ownership post-bankruptcy

Akerson is said to be intolerant of those who don’t carry their weight and will continue to stir and shake-up the already dizzy GM management.

“He’s a no B.S. kind of guy, just like Whitacre,” Steven Rattner, former head of the White House auto task force told the Wall Street Journal. “His whole operating style is the antithesis of the old GM. It is hard for me to imagine a better choice.” Rattner supported Akerson’s appointment to the GM board last year.

Akerson is currently a managing director of the private equity firm the Carlyle Group based in Washington DC, where he oversees $60 billion in assets. His financial expertise is considered the best reason for him taking over GM in time for its IPO; his experience is likely to comfort investors.

Akerson has also played a central role in some of GM’s decisions in his time on the board. One of those was to remove Fritz Henderson last year.

The other, most revelant to us, is the fact that he has advocated for GM to expanded development and production of fuel efficient vehicles. In particular he was instrumental in the recent decision for GM to increase 2012 Volt production volume from 30,000 to 45,000 vehicles.

Akerson is a former naval officer who graduated from the U.S. Naval Academy and served on the destroyer U.S.S. DuPont from 1970 to 1975.

According to William Conway, co-founder of the Carlyle group, Akerson is motivated to help serve the nation’s interests by getting GM back to good health and back in the hands of shareholders.

“He has a sense of duty,” said Conway.

Source (Wall Street Journal)

On the same day GM announced one of its greatest quarterly profits in a long time, CEO Ed Whitacre dropped a bombshell; he is stepping down as CEO effective September 1st. He will continue on the board of directors until the end of the year.

Replacing Whitacre as CEO will be Dan Akerson, 61, who has served on GM’s board since July 2009. Akerson has been CEO of XO Communications, Nextel and General Instrument Corp and managing director of the Carlyle group.

“My goal in coming to General Motors was to help restore profitability, build a strong market position, and position this iconic company for success,” said Whitacre. “We are clearly on that path. A strong foundation is in place and I am comfortable with the timing of my decision.”

“There are remarkable opportunities ahead for the new GM, and I am honored to lead the company through this next chapter,” said Akerson. “Ed Whitacre established a foundation upon which we will continue building a great automobile company.”

Akerson will thus be the fourth CEO at the helm of GM since the Volt concept was first introduced, and hopefully the last before the car is finally launched.

It is not clear if Akerson will only serve in an interim capacity. Whitacre claims his job was always intended to be temporary. “Ed and I share a common vision for the company, where it is today and where we hope to take it in the future,” said Akerson in a conference call. Discussion of his future plans and priorities “would be premature,” he said.

Our favorite car expert Bob Lutz, now in retirement from GM, answered an email from the AP about his opinion on Akerson with whom he worked prior to retiring.

“He’s very strong, very opinionated, not always right, and needs to work on listening skills,” Lutz said. “If he can bring himself to trust his now-outstanding senior executive group and lead rather than direct, I think he’ll do an outstanding job.”

This morning GM reported quarterly earnings of $1.3 billion dollars for the second quarter of 2010 on revenue of $33 billion, up 43% from a year ago. If you like your earnings expressed as EBIT (which GM does-or earnings before interest and taxes), then the profit was $2.0 billion. This is the largest quarterly earnings report since 2004.

Most of the earnings, $1.6 billion’s worth, came out of GM North America, while GM International also posted a gain of $700 million. GM Europe continues to be GM’s anchor, losing $200 million…which really is quite hard to believe astonishing. Cash flow from operating activities was pegged at $2.8 billion and GM was left with $32.5 billion in the bank going forward. (including monies in escrow)

The numbers are a success for GM in more than just a reported bottom line number. They are, in essence, the completion of the work that Chris Liddell (GM Vice Chairman and Chief Financial Officer) was brought in from Microsoft exclusively to do, namely resurrect GM’s finance quickly and get out the IPO. If there is one thing the former CFO of Microsoft knows better than anyone else how to do, its ‘hittng the number’ and managing expectations…his run at Microsoft was near flawless. Mr. Liddell’s track record of achieving all goals set in front of him continues at GM.

Don’t believe that Liddell was brought in primarily to set the table for a IPO? Follow the money. Chris Liddell is paid $750,000 per year by GM, but he gets 5.45 million in stock specifically if the IPO is a success. That 5.45 million is money that will be well earned. Mr. Liddell now seems well suited to take over the company when current CEO Ed Whitacre Jr. goes silently into the night.

On the earnings report, Mr. Liddell assesses his (and GM’s) accomplishment, “I am pleased with our progress on achieving our business objectives, we have delivered strong product, maintained cost discipline, progressed strategic initiatives such as restructuring Europe and acquiring AmeriCredit, and delivered two consecutive quarters of profitability and positive cash flow.”

The question since GM left bankruptcy protection and started to file quarterly earnings again was not would they turn a profit…but would they show enough? Would the balance sheet stay pristine? Could sales strengthen in a tough environment? The short answer is yes. It has been such a success that the reclusive Mr. Whitacre came out in public over 1 time this month to talk about what a success the Q2 earnings would likely be ahead of the news today…a personal best in appearances for him.

Now does this mean that it was a smart financial move in the long run to buy sales and show a profit at all costs for the quarters between bankruptcy and today? Can you justify incentives once again cresting $4,000 (Edmunds) when the company is supposed to be returning to fiscal discipline? Can a company that had said only a year or so ago that a fleet level of over 20% of sales was unacceptable, now really think bumping that number up to 31% to ensure year over year sales increases is turning the corner? How about the ‘undeletion’ of a 1,000 dealers previously said to be undesirable? Good move? How about the addition of AmeriCredit so they can sell cars to the sub-prime customers that really shouldn’t be buying them? Is that savvy? Is the announcement of re-acquiring a 5 billion dollar line of credit really a net positive?

The answer is a resounding maybe.

Normally I am a pessimist and would say no, these examples are hideous ways to do business, this is old GM. However, in this case, GM did these automotive atrocities with a purpose…not to just keep the paychecks running to the top of the Ren Center as long as possible and to push their problems down the road a little further. These crimes against common sense were done to set table for the IPO, to make the company go public this year, and to make this offering live up to even a fraction of the lofty expectations placed on it. In other words, these insanities were done with a sane reason, and that makes them acceptable. The potential reward is greater than the risk taken.

With the two successful quarters reported and out of the way, the next step is to file for their IPO with the SEC, and then to rid itself of some of the 61% government ownership in the company (and to raise a little cash for themselves of course).

At the time of press, ‘sources’ inside GM say the company will file with the SEC on Friday, meaning the company will be on the open market again before elections in November. (With ‘sources’ in this case likely being the same fellows who penned their quarterly earnings announcement) GM’s IPO will likely be the largest in American history.

Will the fall sale of GM be a success? That question still remains unanswered. But regardless of the end result, GM has done their very best (or worst) to convince the world that they are a company that can grow, make money and sell cars. A necessary evil these days in the world of automotive IPOs (Tesla anyone?)

Their strong balance sheet, flush with government money, has let Chris Liddell wave his magic wand over GM’s sales and quarterly earnings, and sell the heck out of company that has no business being valued as high as they ultimately will be on that fateful day in November when the public once again lines up to buy shares of the American institution; but if they are disciplined enough, someday they may actually be the automotive juggernaut they are attempting to convince everyone they already are.

Once the IPO is complete, I expect GM, under Chris Liddell’s leadership (either as CFO or CEO), to attempt to right the ship very quickly. The streak of monthly year over year sales gains will come to a end. Fleet sales will drop. Incentives will fall. No longer will the starting point of negotiating to buy a Silverado be $5,000 off.

In truth, GM likely will make little to no profit in the quarters after next…maybe even show some losses, the share price (post government IPO exodus) maybe in the red, but make no mistake, the company will be much healthier then than now…and firmly on the right track to return to glory.

/thanks to Chris Liddell

The Chevy Volt is a brilliant solution that allows mainstream drivers the opportunity to execute the majority of their driving using electricity as fuel.

Though GM believes in Voltec technology and has put its best foot forward with the Volt, it is still keeping the other foot in the pure EV game.

According to Karl Stracke who is GM’s Vice President of Global Vehicle Engineering, the company will be establishing a global EV test fleet. The fleet will deployed in several regions around the world, and will consist of several different cars. A working prototype of an electric Chinese Chevrolet Sail already exists (shown above).

“These demo fleets will increase GM’s competitiveness in vehicle electrification by providing GM with real-world data on driving patterns, battery charging, market needs and customer acceptance while sharing costs and resources with supplier and government partners,” said GM in a statement.

I reached out to GM spokesperson Brain Corbett for further details.

“We’re launching multiple BEV demo fleets in various regions around the world using different types of vehicles,” said Corbett. “We’ll have more details going forward.”

Corbett acknowledged that the EV fleet will include many partners.

“We have many partners with these BEV demo fleets and can’t disclose everything at this time,” he said. “The partners do not include another automaker. In fact, the BEV demo fleet strategy mirrors our battery strategy — we’re partnering with suppliers, universities and government agencies. This allows us to share costs, resources and learnings.”

He explained the purpose of the demonstration fleet is to further the development and progress of core competencies and components.

“The primary goal of the BEV demo is to continue to develop our core vehicle electrification components: batteries, power controls and motors,” he said. “These components are needed for hybrids, plug-in hybrids and electric vehicles such as the Volt.”

“The BEV demo fleets will also provide real world data of customer acceptance of BEVs and use patterns and charging operations,” he added.

Unfortunately it appears the US won’t be included in the demonstration program

“Going forward, we will disclose the specific vehicles, number of vehicles and location of these demonstration fleets, although I will tell the US is not included,” he said.