The American Spectator

The Nation's Pulse

Volt of the Masses

By Eric Peters on 7.2.08 @ 12:07AM

(Page 2 of 2)

That assumes GM can sell the Volt in the first place.

The automaker has already announced that it anticipates the MSRP of the 2010 Volt to be in the $40,000 range -- with subsidies. Yikes! That is in the same ballpark, price-wise, as a loaded BMW 330i luxury sport sedan.

Now, people buy hybrids (and, ostensibly plug-in electrics like the Volt) because they want to save money otherwise spent on fuel. In other words, the whole point is not saving gas per se. It is saving money. Right? If you can afford to spend $40k on a car -- plug-in or otherwise -- do you really give a hoot about $4 (or even $6) per gallon fuel?

The Prius costs about $20k -- half the anticipated cost of the Volt (which, incidentally, would be the most expensive passenger car -- excepting the Corvette -- ever offered for sale by Chevrolet).

Who is going to buy a $40k Chevy? It's too expensive to make sense as an economy-type car. And the Chevy brand (no offense) is probably too "cheap" to bring in many of the $40k type of buyers who purchase status cars such as BMWs and Audis.

PERHAPS MORE ominously for GM, what if the Volt does "sell"? Remember, the $40k price is subsidized -- meaning GM is not making any money on the sale. It is simply trying to keep costs somewhat in line with reason and reality -- in the hope that eventual upticks in volume will allow for steadily decreasing retail prices -- and eventually, profitability.

But GM hasn't made a profit since 2004. How many years (months?) can GM build and sell a voluptuously expensive car at a loss? Can GM afford to invest hundreds of millions to develop a car that can only be "sold" by giving it away?

The Volt is drawing a lot of interest. The question, though, is whether it can draw actual buyers -- and make money for an increasingly desperate GM.

Maybe they'll pull it off. Godspeed. I hope they can. But would I put money on it?

Uh, no.

Maybe by 2015 or 2020.

But by then, it will almost certainly be too late. Not for the Volt, perhaps. But for GM.

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