Does the Volt Need a Jolt?

Senior Obama administration officials are in Detroit today, visiting a Ford plant that makes green vehicles and touring the production line of the Chevrolet Volt.

The Volt hit the market late last year with a surge in attention, but its sales so far have been disappointing.

General Motors set a goal of selling 10,000 Volts in 2011. But with less than three months to go, the automaker has moved only 3,895 of the plug-in electric cars, which have an electric battery range of about 35 miles.

One of the Volt’s biggest problems is its hefty price tag. You may be saving on gas, but you’re paying $41,000 for the privilege. And with the economy suffering, that’s a hard sell.

Its closest rival in the electric car market, the Nissan Leaf, is $34,570, and has sold in higher numbers this year. The Leaf is purely electric, without the backup gas engine that the Volt features.

Even some of Chevrolet’s own cars are tough competition. Many of the people who arrive at a Chevy showroom to check out the Volt wind up leaving with the much less expensive Cruze, which has a base price of only $16,720.

Still, GM apparently has confidence. It plans to produce 50,000 Volts next year, compared with 16,000 in 2011. And sales of the Volt, while low, have climbed sharply in the past two months.

Both the Volt and the Leaf are eligible for a $7,500 federal tax credit – though there have been reports that some GM dealers found a way to game the system and keep that credit for themselves.

A GM spokesman told the Chicago Tribune that the Volt is just now hitting showrooms across the country. Until now, the car had only been available in seven test markets, including Michigan, New York and California. And a wrinkle in California law made it difficult for Volt buyers to qualify for a $5,000 state tax rebate that the Leaf and some hybrids were eligible for. But it does qualify for incentives in some states.

Potential Volt buyers have had to weigh whether the Volt would pay off in the end. So, about how long would it take to make up for the premium that you’d pay for a Volt?

Say you drive an average of 40 miles a day. In Chevrolet’s Cruze Eco, which costs $19,245 and gets 42 mpg, you’d be paying about the average cost of a gallon of gas, $3.43, to commute each day – or $1,252 per year.

Now, the Volt. First, let’s take the tax credit off of the MSRP. That brings the Volt to $33,500. With fuel efficiency rating of 37 kilowatt hours per 100 miles and an average price of $.12 per kilowatt hour, your daily commute cost goes down to $1.73—an annual savings of $620. But you’re still paying a $14,255 premium … which would take about 23 years to pay off, at current gas prices.

Still, you get to use the HOV lanes in some states, which may be well worth the cost in the time you save. Plus, you’re getting state-of-the-art technology and helping save the environment, and it’s harder to put a price on that.

Comments

  1. omnimoeish
    June 17, 2012, 4:30 pm

    John, the Volt and even Leaf’s don’t require charging stations. The Volt for obvious reasons, it has a backup engine that gets nearly 40 mpg. The Leaf has a 100 mile range. I don’t know about you, but most people don’t need that much range in a typical day. Sure you go on vacation, and you’ll need more range, that’s not purpose of the Leaf though. Either rent a car for a week or use your other (most people have more than one). In my area, it seems everyone and their dog has a charging station at their store (literally dozens). There might be more charging spots than EVs. But the main thing holding sales back is that they can be more expensive for people who don’t use them. I am curious what GM has up their sleeves to increase sales from 5,000 in 2011 to 50,000 in 2012. It better be something than the small improvements they’ve already talked about for the 2013 model year. Also, just to set the record straight, GM is basically using the Volt as a “halo car” which means that it draws people in their dealerships and the ambiance makes people buy their Cruze, which if you’ve been paying attention, sales have been pretty incredible for a midsize Chevy which historically have been a joke, and best of all, they’re actually making a profit. The Cruze is actually a great car from an engineering standpoint and cost effective standpoint. There’s a lot of Korean engineering in it and it’s been on sale in Korea since 2008.

  2. Engineer
    February 25, 2012, 12:14 am

    The reasons why smart people do not buy Electric or Hybrid cars are: Batteries are expensive, short lived, efficiency isn’t 100 % and the electricity is not free. Going electric you won’t decrease Air Pollution because, 50 % of the electricity is produced by burning COAL. By the way a Jetta Diesel, TDI for $23000 makes 40MPG. With a full tank of Chevy Volt, driving non-stop, you make 37MPG, plus $3 or more, the price of electricity you charged 16.0-kW-hr lithium-ion, the hefty $10000 of the 750-pound battery pack.
    Using Chevy Volt, in the Electric Mode Only, Charging and Discharging the battery pack every day, is going to cost you $1000 in electricity, plus $3000 in the battery amortization, with a TOTAL of $4000 per year.

  3. Craig Slawson
    Denver
    October 20, 2011, 4:57 pm

    Have you driven one? Perhaps you should. It rocks. Did you know there are a $13,000 tax credit (St+Fed)?? It rocks. Did you know it really never needs gas if all you do is local errands? It is nicer inside than a Prius (I have had 2) and faster, more safe/substantial and more features.

  4. Linda Pruitt
    San Francisco,CA
    October 19, 2011, 1:57 pm

    Cut the price in half and I’ll buy it.

  5. John Howley
    Orlando, Florida
    October 13, 2011, 11:55 am

    We’ve got a chicken and egg problem here. Once enough plug-ins are on the road, we will see bog box stores and other retailers rolling out recharging stations in their parking lots. And they will probably offer either discounted or free charging based on membership in their frequent buyer’s clubs or the amount of time and money spent in the store. That will eliminate the fear of running out of current and further bring down the cost of running a plug-in EV. But the paybacks will still be very long until we start paying the true cost of gasoline at the pump.

    John Howley
    http://www.HowleyGreenEnergy.com

  6. rgw1946
    ill-usa
    October 13, 2011, 12:36 am

    And reason for cost–and buying from Gov Motor’s(GM) sorry–do not think so.. remember how GM sold Chevron Electric Pat. ->> EV1.ORG << then Chevron sued Toyota…SCAM

  7. Stephanie
    Detroit
    October 12, 2011, 5:43 pm

    Even here in Detroit and the surrounding area, the Volt is hard to come by and usually an uncommon sight on the highway. I see more Prius’, Leaf’s, and other similar cars than the Volt.

    I wrote a review on the Volt when it was just released in Michigan and cited the huge price tag, as well. Cars like these shouldn’t be considered a luxury, they should be commonplace and easy to obtain. But, with GM at the helm, that’s likely not to happen anytime soon.

    It was a great idea and the concept was promising, but, this car really flopped. Hopefully it can start to pick up and maybe they can even lower the price so a bigger market can enjoy them.