The American Spectator

The Nation's Pulse

GM is doing a very brave -- and arguably, exceptionally stupid -- thing.

Desperate to recover lost status and market share, the world's formerly largest automaker is devoting massive resources toward what it hopes will be the most revolutionary new car since the Model T.

The car -- which will be sold through Chevy dealers as the Volt -- is a "next generation" hybrid that differs from the current crop of hybrids in that while it has a small gasoline-burning engine in addition to an electric motor and batteries, the gas engine plays no role in propelling the vehicle. It merely kicks in every now and then to generate electricity for the car's battery packs, in between plug-ins.

The Volt would thus be, for all practical purposes, a pure electric car -- with just the vestigial tail of an internal combustion engine connecting it with its distant ancestors of the 20th century.

Production is planned for 2010 -- a little more than a year-and-a-half from now.

If GM pulls it off, it will have a shot at rehabbing its image -- tarnished almost to bare metal after years of indifferent and mediocre product and behind the curve reactive thinking. Toyota -- inventor of the huge-selling Prius hybrid -- will look as stodgy and risk-averse as the GM of the '90s under Roger Smith.

THE PRIUS, AFTER ALL, is basically a regular car with a regular gasoline engine as its primary source of motive power. While the Prius can run for brief periods at low speeds (40 mph or less) on its batteries alone, most of the time, it is being pulled along by internal combustion. Sure, it gets 40-something MPGs -- but you still have to fill it up. And you can't plug it in.

The Prius is as fundamentally dependent on OPEC as a '74 Buick Electra 225.

In theory, the Volt would sever that connection -- replacing the corner filling station with the 110v outlet in your garage and an extension cord. GM's goals for the Volt include the ability to run continuously at highway speeds on electricity alone -- and to be able to go at least 40 miles before its batteries must be recharged. If the owner's daily commute is less than that (each way) and he has the ability to plug the car in for a few hours before having to head back, he may never need gasoline at all.

If it all sounds to good to be true, maybe that's because it probably is.

For openers -- and by GM's own candid admission -- it doesn't yet have a battery pack that can deliver the goods. Battery technology has long been the Achilles' heel of electric cars. They are heavy, expensive -- or some combination of the two. No one has yet figured out a way to build a reasonably compact, high-performing battery that can do the things expected of the Volt...for a reasonable price.

That includes GM.

This is why current hybrid cars like the Prius remain dependent on internal combustion -- and gasoline.

Yes, GM has "new design" batteries in development. But will these pan out? And within 18 months? That is a seriously Tall Order.

AND ON MORE than one level, too. GM won't have time to do much, if any, meaningful real-world testing given its 2010 timetable. That means (computer "sims" notwithstanding) it really won't have any idea how these new design batteries -- if they can be designed in the first place -- will perform in the real world, especially over the long haul. Any new technology typically goes through a teething stage during which it is, to be charitable, less than reliable. If GM sells several thousand electric lemons (remember the Impact electric car of the '90s?) that break down six months out of the gate, it will be a lot worse for the company's rep and fortunes than the infamous Oldsmobile diesel of the late '70s.

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.