GM-VOLT : Chevy Volt Electric Car Site

After three and a half years of calling our favorite car the Chevy Volt, and decades of using the word Chevy apparently GM has decided the time has come to stop doing so.

The company issued an official memo to employees to stop referring to the brand as Chevy.  Citing the need for consistency to help build the brand and produce a singular message, from now on all members have been told to only use the word Chevrolet.

This new idea also coincides with GM firing the Campbell-Ewald marketing agency the company has used for 90 years and switching to Goodby and Co.

The memo is as follows:

We wanted to write you a quick note requesting your support of our Chevrolet Brand. When you look at the most recognized brands throughout the world, such as Coke or Apple for instance, one of the things they all focus on is the consistency of their branding. Why is this consistency so important? The more consistent a brand becomes, the more prominent and recognizable it is with the consumer. This is a big opportunity for us
moving forward.

As you know, we are investing substantially to improve the consistency of our retail facilities through the EBE process. Aside from the facilities aspect of our branding, there are many other ways in which we can demonstrate this consistency. One way to achieve this is with the use of Chevrolet vs. Chevy. We’d ask that whether you’re talking to a dealer, reviewing dealer advertising or speaking with friends and family, that you communicate our brand as Chevrolet moving forward.

We have a proud heritage behind us and a fantastic future ahead of us … speaking to the success of this brand in one consistent manner will ensure Chevrolet becomes even more prominent and recognizable than it already is.

Thank you for your support of this effort!

Not being a real member of the Chevrolet team, I of course did not receive this memo.  I was all ready to support the cause if it was for the greater good when GM issued a press release as follows:

Today’s emotional debate over a poorly worded memo on our use of the Chevrolet brand is a good reminder of how passionately people feel about Chevrolet.  It is a passion we share and one we do not take for granted.

We love Chevy.  In no way are we discouraging customers or fans from using the name.  We deeply appreciate the emotional connections that millions of people have for Chevrolet and its products.

In global markets, we are establishing a significant presence for Chevrolet, and need to move toward a consistent brand name for advertising and marketing purposes.  The memo in question was one step in that process.

I had reached out to Klaus-Peter Martin of GM corporate communications.  He explained the situation to me the following way:

The Chevrolet vs. Chevy question is simply about how we communicate the brand going forward in advertising and other external communications. We love when people call us by our nickname “Chevy”. But Chevy is not our official brand name – it is Chevrolet. In the US Chevrolet and Chevy stands for the same thing and is understood as such, but Chevrolet is also one of the fastest growing automotive brands globally. In many of these countries we are just about to establish brand awareness for Chevrolet, so by calling us consistently Chevrolet helps to expand our reach. This process will take time and will not happen over night.

Finally, John Hughes, marketing manager for the Chevy Volt summed it up this way:

I will refer to it as the Chevrolet Volt.  You can call it what you like as long as you keep talking about it.

And that I shall.

Source (New York Times)

When the Volt concept was first unveiled Ed Peper was the manager for Chevrolet.  He was replaced in 2009 by Brent Dewar who only held the postion for a couple of weeks.  At the same time Maria Rhorer was given the new position of Chevrolet Volt director of marketing.  She was reassigned after the infamous Chevy Volt dance.  Next Jim Campbell was named Chevroelt brand manager and most recetnly Tony DiSalle was named product marketing director for the Chevrolet Volt.  DiSalle previously was the VP of OnStar and it seems likely he will stay in place though the car’s launch.

Mr DiSalle recently was profiled in a GM YouTube video and provides us with some insight to his line of thinking and plans for this critical last push to the finish line of getting the car into consumers’ hands.

DiSalle says the overall marketing strategy for the Volt is to “inform and educate customers,” who themselves “will then inform and educate others.”

He says the car has a tendency to inspire people who understand how it works to want to talk to others about it. Thus, he says, “if we can get the car close to key influencers..they will go online and write about it.”

The reason GM chose Washington DC, California, and Michigan as initial launch markets , he explains, was to put the car “close to people who would have a strong propensity to talk about it.” This group as GM sees it includes “influencers, early adopters, politicians, and other high profile people.”

The burning question of when GM will finally announced the official price was sort of answered.”We’ll announce pricing late this summer or early fall,” he said.

DiSalle also says the Volt ownership experience will be unique, starting with the “connected customer concept,” created by the rich content of the dual screen displays in the car, extending outside the car through smartphone app interaction, Volt-specific OnStar diagnostics, and an innovative “web-based owners site with “with some pretty neat functionality as well”

“Its a total connected customer experience,” he adds.

After three and a half years of daily Volt posting on this site is it possible to lose sight of the larger forces in play?  This site was started to convince GM to build the Volt from a desire both to get our country off of oil as well as to help promote the purchase of cars from an American manufacturer.

Volt hype has had a very very long ramp up, and the majority of the US population are probably aware Chevy is working on an electric car.  Nissan publicly entered the space much later, just last year, and only officially announced its pure electric LEAF in August of 2009.  Yet they have been marketing aggressively, having announced pricing, launch markets and having begun taking pre-orders.   Furthermore Nissan’s CEO is vocally very bullish on electric cars, projecting a 10% market share for them by 2020, and with plans in place to build 500,000 LEAFs per year within a few years.

We often get into comparisons between pure EVs and electric cars with range extenders on this site.  From a practical utilitarian standpoint, the EREV would likely be more popular, something GMs internal research also suggests.  One study concluded 83% of respondents would prefer a 40 mile EREV to a 100 mile EV.  Recently, a large consulting group determined range anxiety will be a significant issue and that the majority of people beleive an electric ar needed 300 miles of range to be practical.

Nissan marketing is pushing the idea of no gas anytime, and no tailpipe emissions.  They are equating the car with good health too, like choosing Lance Armstrong as its sponsor.

It is odd to consider a car’s popularity since no-one has ever actually bought or test driven one, but at this unusual turing point in automotive history, it is possible.  Using publicly available Internet measures of popularity it could be concluded that there is more interest and enthusiasm for the LEAF.  Google handles 60% of all Internet searches.  Using their Trend tool, searches for the LEAF have now surpassed those for the Volt and are almost double the volume (graphic above).

Furthermore, the official Leaf Facebook page has 54,000 members while the Volt Facebook page has just 24,000.

Finally, Nissan’s official interest list has 130,000 people on it, and they have gotten 13,000 pre-orders.  The size of the offical Chevrolet.com Volt interest list has just been disclosed, and stands at 42,000.  The GM-Volt.com unofficial interest list has 52,000 on it, many of whom may appear on both lists.

So is the LEAF more popular with the American public than the Volt?  And what does this mean for the Volt?

One could argue that none of this really matters now, because once the vehicles are in the public space and people begin to live with them only then can true popularity be determined as it equates to sales.

And in the end it really doesn’t matter, because both cars reduce the use of petroleum and that after all is what its all about.  Some people will probably even buy both cars for their home.

As the days fall off the calendar counting down to when General Motors is expected to start delivering the first Volts into the hands of eager customers, we have been left to wonder about one of the most important decision making factors of the vehicle – the price, and just when we will find out what the price is.

Recent speculation puts that date as far out as October. But regardless of when the actual announcement date rolls around, it begs a more important question; how many sales is GM losing by delaying this announcement and sale of the Volt?

The answer is up to 12,000 and counting. Nissan now has their arms wide open, accepting reservations from anyone who would like to purchase one (or two) of their 100 mile electric cars, the Leaf.

It is obvious there is a huge early demand for electric cars from the group affectionately known as the ‘early adopters,’ and they have been impatiently waiting for a long time…long before the concept of a range extended EV from GM ever existed. To say they will choose to wait even longer for an arguably better platform, while another car goes on sale and hits the market, would be a mistake.

It is a rare day here at GM-Volt.com when you can get through a comment string that doesn’t have someone who wants and prefers a Volt saying that they just can’t wait on GM and they have put in a reservation with Nissan to buy a Leaf, or at the very least intends to lease it, planning to revisit GM’s offerings 3 years later.

I know for myself, I am the same. I will not wait. I will not pass the ‘what is now,’ for the ‘what is coming.’ I will not indefinitely watch as other EVs drive pass me on the roads hoping for GM to deliver. Fortunately for GM in my case, I may very well add a Leaf to the family, and replace a daily driver with a Volt…but realistically this is not going to happen for most other early adopters.

GM never dreamed they would have someone beat them to market, and even though they clearly have decided not to react to the pressure that Nissan has put on them when it comes to scooping up the early adopters, they are still assuming all the business they originally penciled in will still be there on their timeline regardless.

Bob Lutz, in his exit interview with GM-Volt.com was asked just about this subject:

How large do you think the early adopters will be? And what types will they will be. Have you looked at that and studied that?
“I think it is going to be larger than we think. I think every politician in the country and in most other countries is going to want one…everybody who is in show business will want one, I think it will completely displace the Toyota Prius as the vehicle of choice in Hollywood, I think every state governor is going to want one. There is just a enormous latent demand for vehicles to start”

It seems like GM is refusing to believe/acknowledge there is another electric car out there that could scoop up even one sale at all. With Nissan averaging about 500 reservations per day since they put the Leaf out to market, we will never know how many sales GM is losing to them every day, but make no mistake, sales are being lost.

If I didn’t know better, I would say they don’t care. That they don’t have any interest in cultivating a deep order book…and that might just be the case.

As we move closer to the Volt’s launch date, besides pricing, people are beginning to wonder whether the Volt will be sold only, leased only, or both. Nissan has announced pricing for the electric LEAF and has also announced the lease price.

Recently a GM-Volt commentator wrote about he following observation he had made, calling it “breaking news” that GM would only be leasing the Volt:

I just received my GM Card bill, and it included a notice that we WILL NOT BE ABLE TO APPLY GM CARD EARNINGS TO LEASE A VOLT for the first year, i.e., until November 2011. Then they go on to say that “as of November 2011, you will be able to apply your GM Card earnings to the Chevy Volt.” What caught my attention was the use of the word LEASE in the first year (no mention of BUY), then ambiguous reference to the second year and beyond (no distinction whether LEASE or BUY).

I pointed this out to GM Volt strategic marking manger John Hughes.

“I wouldn’t read to much into the note from the card,” replied Hughes.  ”There will be both purchase and lease options to acquire a Volt when it goes on sale.”

GM has said it wasn’t expecting the car to compete with the LEAF, considering the two entities as occupying completely different segments.  Pricing thus should’nt be compared either.

“I (am) excited about other EV entries joining us in the vehicle electrification movement,” said Hughes.  ”It will take different types of EV’s at different price points to serve the varied needs of consumers just as there are SUV’s at various sizes and price points.”

GM will apparently not be releasing pricing in May as was first expected.  Rather Hughes says, “we’ll have quite a bit more to talk about later this summer.”

I aksed Hughes if he thought becasue Nissan has already released its pricing scheme and pre-order process that it puts them in some way ahead.

“I don’t agree that Nissan is out in front,” he said.  ”Think about it, there is little for a consumer to do but continue to wait.”

“Its very important that we deliver a quality experience and that we, our dealers, field teams digital systems,…. are prepared,” he added.

Deloitte is a large multinational consulting firm that has just released a new study analyzing electric car adoption, including a survey of 2000 would be consumers and extensive interviews with automotive industry experts. The full report can be accessed here, and is one of the most realistic I have seen.  It is called Gaining Traction: a customer view of electric vehicle mass adoption in the U.S. automotive market.

In the introduction they note a convergence of factors including government incentives are making electric cars “look good”, but warn there are considerable challenges to mass adoption.

Four areas were analyzed: market opportunity, target customers, barriers to adoption, and market forecast.

Market Opportunity
They note electric cars offer unprecedented opportunity for automakers, yet unprecedented threat as extensive, expensive restructuring has to take place.

Target Customers
The study builds a profile of who the early adopters will be noting they “will be a small number of buyers, nowhere near the volume needed for mass adoption.”  They are considered to be young high income (>200 k household) people, mostly centered in Southern California who already own one to two vehicles. The vast majority of the US population are expected to be non adopters.

The next wave that will enter the market immediately after the early adopters, are called the early majority. These people are generally 40 to 44 with a household income of 114K. Ninety percent will have garages and their weekly driving mileage will be about 100. This group consist of 1.3 million individuals.

Barriers to Adoption
The study notes the majority of the population would consider purchasing EVs but four barriers to adoption will hinder actual sales.

Familiarity: the research suggests though people have heard of electric cars, they are not familiar enough with the technology to be comfortable buying them. In their survey of 2000 people it was found the majority were familiar with the terms hybrid and plugin hybrid.  The least familiar term was “range extender,” even less than next up from the bottom “battery swapping stations.”

Brand: would-be consumers said they would be most likely to buy an electric car if it was from a brand they trusted. The study showed that 17% would prefer to buy and electric car from Toyota, 15% from Honda, and 12% from Ford.  The Chevrolet brand came in forth at 8%, and Nissan came in ninth at 4%.  Tesla came in at just 2%, and Fisker was zero.

Range: though most participants drove little enough that a 100 mile EV could satisfy their needs, range anxiety was determined to be “pervasive.” Seventy percent of respondents believed they needed a minimum of 300 miles of total range before they would feel comfortable purchasing an electric car.

Charging: 81% said they would want to charge at home, but 61% said they wouldn’t have the right  access for home charging. Only 17% said they would be willing to wait 8 hours to charge a car, and more than half said they wouldn’t buy an electric car until there were ample easy-to-find public fast charging stations.

Price: 69% said price is the most important issue in deciding to buy an electric car, and most felt the price should be less than $30,000. It was determined that lithium-ion batteries would have to drop 40% from their current value for EVs to be on par with ICE cars. 2014 was the projected year for this price point to be reached and thus will likely be the inflection point at which the early majority will enter the market.

Market Forecast
Based on the barriers to adoption and target customers as outlined above, the study concluded a rather conservative forecast of electric car sales. It was estimated that by 2020 electric cars of all types will account for only 3.1% of the US market, or approximately 465k units. If five different automakers are in the 2020 market, the forecast is that each company would only sell a total of 93,000 electric cars per year by then. These low levels of market acceptance, they conclude, would make it very difficult for the automakers to recover up-front investment costs.

Source (Deloitte, PDF)