The GM Volt: Fascism Strikes the Auto Industry
The most important difference, however, is this: in 1980, the government did not become a major stakeholder in the company. There was oversight, and arm-twisting, to be sure. But the Feds did not then take a 61% ownership stake in the company, despite influential economist John Kenneth Galbraith encouraging it. (After an upcoming stock sale, the govenment’s stake in GM is expected to be reduced to below a controlling share.)
And that 61% stake, not to put too fine a point on it, is fascism.
Soft fascism, but the squishy kind inevitably leads to the more robust variety. Even the former is ruinous for prosperity and freedom.
One of the chief characteristics of fascism is this sort of public-private “partnership.” A business is still nominally private, but its fortunes are controlled lock, stock, and executive compensation barrel by the government. In essence, under that arrangement, there’s no important difference between public and private; executives become civil servants in disguise. And that’s a fundamental shift — just the sort Obama had in mind during the campaign — from the normal way of doing business even in mixed-economy America.
Onerous regulations that distort market signals are impractical. Putting a heavy thumb on the scale in favor of unions is wrong. Both lead to bad business outcomes and large-scale injustices; both violate the right of voluntary trade and hobble efficiency. But unfair and costly as those are, they don’t amount to a wholesale blending of government and private enterprise. That is what the semi-nationalization of the auto industry has done, and the Volt is how badly that scheme always turns out.
The fact that it will lose money is far from the worst effect. To envision the endpoint of this philosophy, one need only look to Italy during the ’20s and ’30s, when dissent was outlawed and opposition newspapers shuttered. Even in the milder version in America during the Wilson administration, dissidents were jailed, books burned, forms of free speech banned, and conscription instituted. In short, freedom shrank.
Sure, it’s just a car, and GM’s management invited the Feds into the boardroom. But history shows it’s not a long trip from the senior “partner” dictating compensation policy to Yellow Shirts bashing heads in the streets. Anyone who believes that liberal fascists will stop at throttling “the rich” (as if that were OK) can find a roadmap there.
When government gets in bed with business, citizens lose a lot more than money.
You forgot something.
50% of our electricity comes from COAL
So this is a coal burning car… the green people are not GREEN.
I have to pay taxes (lots of them) to have cars burn coal. Crazy world.
When I lived in San Diego, they were still burning oil! Don’t forget the battery disposal and replacement when it craps out. If you think disposing of a mercury filled “green” florescent lamp is tedious (read the label sometime) try to get rid of a huge lithium, nickel-metal hydride, or nickel cadmium battery.
I can just hear Homer Simpson now, “MMmmmmmmm, cad-mi-um.”
Yes, and guess where the vast majority of that Lithium comes from!!
China (which has about 10% of the world’s resource) – not particularly America friendly.
Bolivia (which has about 80% of the world’s resource) – whose President is riding the same “Death to America” bandwagon as Venezuela’s Huge-ego Chavez and Iran’s Armageddon-eye-jab.
So we are going to move away from paying the Saudi’s (who want to fly airplanes into our buildings) for oil, to paying for South American dictators who want to kill us.
Sounds reasonable to me…but then again I like crunchy peanut butter on bratwurst.
Oh…and buy the way…the reason that Comrade Barry is still banning all offshore drilling is so that eventually we’ll have to go to Cuba to get a lot of our oil. Seems he’s more comfortable with shackling us to the Castro brothers than letting us produce our own oil.
Don’t even for one minute think THAT will change either.
I thought we had stores of lithium here, just not legally mineable thanks to Maxine Waters and co.? Or is that another high end metal I’m thinking of?
I do love the fact that we’re fighting global warming with a) future mercury poisoning coming from landfills, b) onerous trade with countries antithetical to our ideals and c) precious metals mined in countries with some of the worst environmental controls in the world (not to mention ideals antithetical to ours). It seems that on all counts, with just a basic look, we’re creating a growing catastrophe with little to no forethought. Where the hell are the environmntalists? (I know, dumb question)
I never thought I’d say, I hate my government, but really, I’m starting to. I believe in the foundation of it (the Constitution and the Bill of Rights), but I think the house (congress and the exec. adminstration) is a total loss.
And, of course, we remember that His Majesty specifically stated during the campaign that he intended to create regulations which would, inevitably, destroy the coal industry.
I work in the coal industry. A few weeks ago I was deep in a met coal mine, talking with one of the mine foremen about the administration’s desire to shut down coal. He thought it would be a great idea, because after about a week, the whole country would come back to coal on hands and knees, and we could kick this “green” crap to the curb once and for all.
ohh the subsidies don’t stop at the electric car. Now we get to throw a few hundred billions at windmills and solar electricity. Central planning is great fun.
Because we all know the life on earth stops when we go from 300ppm (.03%) to 400ppm (.04%) CO2.
Right. We should stop wasting our taxpayer money on this technology. Let the Chinese waste their money. If the cars become economically and environmentally reasonable we’ll be able to buy them from China. Maybe at Walmart!
If there ever is a demand for shitty cars, you are right – China will sell them. Until then, I’d like my tax money going to something useful, like paying down the huge debt.
Actually, it would probably be more efficient if the car burned coal. Coal plants have a thermal efficiency of 30 to 40% due to inherent limitations of the Carnot Cycle. Additionally, depending on transmission and distribution system voltages, there are significant I^2R losses in the transmission process.
There are two significant factors in electric cars that I think most people don’t consider, the first on being yours:
1. The electricity used to charge the car has to come from somewhere.
2. Batteries have a lifetime; battery replacement can be very expensive and disposal of the batteries is also expensive if harm to the environment is to be avoided.
A few things to Speedy about efficiency of electric powerplants:
1. Only about half of US electric generation is from coal.
2. Coal is decreasing, while natural gas-fired generation is INCREASING (even in the recession). Combined-cycle gas plants hit 60% efficiency, open-cycle gas turbines are 40-45%.
3. Nuclear is going up too (long-mothballed projects restarted and new ones on the way).
4. If new coal-fired plants are built, they will be ultrasupercritical plants also achieving about 45% efficiency.
Don’t disagree with any of your statements, with the possible exception of #3: “Nuclear is going up too (long-mothballed projects restarted and new ones on the way).”
The Obama Administration pays lip service to advancing nuclear while effectively killing the nuclear Renaissance. I know of what I speak since I am involved in one of the new nuclear projects that is dying because DOE will not make a decision between 3 candidates to award the loan guarantee. The other projects are likewise dying. Performing detailed design engineering on a new nuclear design is very expensive; no company can afford to do it without some clarity in the financing options. What I see is a government bureaucracy that is postponing the decision, since: a) it requires a bureaucrat to make a decision and b) once the decision is made, the large staff has nothing to do for the rest of the year since they only have enough for one more loan.
Interestingly, another strike against nuclear development is technological advances in recovering natural gas from previously inaccessible shale deposits, which is keeping natural gas prices low for the foreseeable future. Without cap and trade and carbon prices (which I vehemently oppose since no one has bothered to use the Scientific Method to support the need for such draconian measures), new nuclear has an uphill road to walk when making a business case.
A much better case can be made for finishing previous generation plants. TVA is doing great with Watts Barr, and Bellafonte, the most advanced plant design of the last generation, may be on the table for completion. Finishing these plants would be a bargain compared to new construction.
It’s true that the administration’s ideologues are foot-dragging, but this time the forces are against them (unlike 1994, when Hazel O’Leary was able to kill the IFR). Watts Bar and Brown’s Ferry Unit 1 are showing what the nuclear industry can do today, and establishing momentum. Europe is pushing ahead and China and India are both going like crazy. Even Bill Gates is behind fast-breeder technology! Anything the Obamoids can do to stop it won’t last beyond 2013, maybe not past 1/2011.
This isn’t to say that the “alternatives” are bad. They have their points, like 18-month schedules from plan to finish. There’s a 2.7 gigawatt compressed-air energy storage (CAES) plant planned for Ohio, addressing the intermittency issue. Of course, it also addresses nuclear’s peaking issue. In other words, it’s all good.
This is true of natural gas-fired generation in new Power Plants.
It is here in the state of Florida.
So thankful that new plants are being built at long last.
Keep them coming hopefully to your state.
Chuck, I hope this doesn’t sound snarky, but Ed didn’t miss it. Look closely. It’s in the caption of the bogus ad.
You’re point is right, though: all this taxpayer money,AND rebates to the snobs who buy this turkey (increasing the tax burden on the rest of us) for a coal-powered car . . . when it’s not being powered by a good, old-fashioned petroleum product.
I mean, c’mon. What a shameless, clueless buch of morons we have running things today.
Not to worry. GM’s car-making division will be sold to China soon – some underwhelming CEO putting a positive spin on it as he signs the agreement. “This is no backward step . . this is a great day for GM. We face the future with renewed confidence” etc etc.
The company can then get on with its core business, aged care, in partnership with the government. As goes GM, so goes America. Happy days!
They can’t sell it to China yet. There still has to be the merger of Chrysler and GM.
We’ll hear about all the “synergies” that will come from combining the two. The whole will be greater than the parts, etc. etc.
That will put off the crisis until they get enough of the merged company organized to realize they are no better off than they were before, THEN they can sell the whole mess to China.
“$150 million in federal money to the Volt’s Korean battery supplier.”
Um, excuse me, but how does giving $150 miliion to South Korea help either American workers or the American economy? Can’t we build the battery HERE in the United States? What aren’t those jobs going to Americans in an American factory? How much of the rest of the car (parts, that is) is NOT made here in the United States? I’m glad to see that our “stimulus” money is going to help “save or create” jobs….in Korea.
And nobody seems to care these days about the almost $200 billion that was given to AIG. The Federal Government is STILL in the insurance business and it looks like AIG has absolutely no way of paying all of this back. Why do we really want to own an insurance company when it can be sold to at least get back some, if not most, of the money we put into it?
Hopefully, November will bring the beginning of the end of to this massive experiment in socialism (I think it’s more socialism than fascism). At least a conservative Congress can put an end to all of these schemes hatched by Obama and his henchmen.
This was obama’s way of saying i am sorry to the S Koreans for doing nothing about the N Koreans sinking their ship.Let me give you $150 m, it is all ok.If you need more, it will be in the next 2000 + page bill soon to be law.
Actually, the plant *is* in the US. The company (LG) was simply bribed to build the plant here. It’s only one of several battery companies sharing hundreds of millions in grants to prime the electric industry.
These kind of market distortions preclude more rational consideration on the part of both producers and consumers. Absent those distortions, we might be looking, for example, into clean diesel or natural gas as alternatives. Instead, the government in its “superior wisdom” is working to get us to pay BMW prices for a Chevy compact.
In 06, GM was in the Volt build. But they were short to pay some VP his 250k salery, well, times 50. We know you need to have a VP to over see how many feet of wire is in the build.
This Volt could well be just an experiment for after market designers, to power a generator with the motor at idel, that exceeds the draw on the batteries. If France can do it, so could we. Maybe not. The U.S. can’t find any place for nuclear waist than to bury it.
In a perfect Jetson world, we would have a lead cased nuclear supply instead of batteries. afaik, GM has not set a Volt on an Amtack crossing, to evaluate the hazord material yet. But we do have to start somewhere in a new Green mode to electric. The Tesla is a marvel, and only has a sex appeal the Volt does not.
So as we try to put in place, the economy of electric transportation, we have to fix the grid, buy the build back of Nuclear Electric production. Sure, the Solar grid will help, for those able to afford the cost over +/-10 years, but then City Managers across the U.S., must put all city utilites on the Solar Grid.
This would create jobs faster than Walmart. But while at wallmart, you put a dollar in a parking spot, to plug in your Tesla. Again, creating jobs, where that Electric source could use Solar as well, putting jobs in every state.
The exciting facts on Solar is, the new Cells use all colors to produce electricity, over the Red only spectrum of the past. Yes, the Oslumus, and his less experienced Socialist, are killing our chance in Technology, by forcing this new SolarCell to run to China, to have them made. But it is the Greed of U.S. Manufactures and Business whom are to blame as well, sending our great R & D overseas, because Johnny can’t read.
Get the facts corrected on the Volt, and stay out of your attempt to portray Technology in a narrow Political view. Until Oslumus and his even less talented posse are jailed, impeached, denied their Gov.pensions, (all DC pensions) will our inovative Technological Society, be able to advance.
Hey Kilo Watt,
Didn’t I just get a letter from you asking me to help you cash checks?
Actually, an American battery company was in the running. A123 and LGChem, the Korean battery manufacturer, competed for the GM contract. A123′s iron phosphate-based batteries are more expensive than the boring old manganese-oxide based batteries that LGChem makes. Considering how ridiculously overpriced the Volt already was going to be, GM made the cost-cutting decision to go with the LGChem batteries from Korea.
It’s also worth noting that GM has decided to engineer Li-Ion’s energy density advantage out of the Volt. Crossing its fingers and hoping to have a battery last for the 7 year warranty, GM is throttling the battery to run between about 25-85% of its state of charge. Approximately, this lops off about 40% of the battery’s available energy. Tesla and others are being far more aggressive and not taking such a conservative approach to battery management.
The batteries can’t be built in the US because 1) unionised US wages (UAW, a major shareholder in GM thanks to Obama) and 2) environmental regulations which make the plant way too expensive to operate.
So why are we building electric cars with batteries we can’t make here in the United States? Does that really make sense to anyone? What if our overseas sources do not want to sell to us for some reason? Does that mean all of our electric cars will eventually stop because we can’t make the batteries here? Go figure, South Korea will be the next OPEC of electric batteries! Please, this whole idea is doomed.
“Even in the milder version in America during the Wilson administration, dissidents were jailed, books burned, forms of free speech banned”
sounds familiar, maybe because its happening now. another website i frequent just had most of its political discussion shutdown, i.e. no comments on the current administration or basicly anything the goverment might not like.
Please furnish the link to the website you alluded to.
I want to check it out. Thanks!
On another point . . .
Mr. Perren, I object to your use of “crony capitalism.” However qualified you tried to state it, it’s no longer capitalism when the Fed is in charge of the company. I admit it’s a small point, but one that hit me in the face.
Do I have my facts mixed up? I thought the money Chrysler paid back was just Government money that was moved from one place to another?
Columnists like Michael Barone persist in calling this “corporatism”, giving the impression that the corporations are in the driver’s seat, telling the government what to do. I’m sure The One appreciates the obfuscation, as it allows him to have control of the industrial sector, while blaming that sector for anything that goes wrong as a result of his ignorant, ideological, dogma-driven… meddling. (I had a stronger term in mind, but it probably wouldn’t get past the filters.)
What we see at GM, Chrysler, and the banks the government has seized (there’s no polite word for that, folks) is not “corporatism”; it is syndicalist socialism. In which the government makes all the decisions, takes the profits (if any)- and blames its “partners” for any “negative outcomes”.
I agree with Mr. Perren. Studying Italy under Mussolini is an excellent idea, if you want to know where this is liable to end up. For a handy Cliff’s Notes version, try the book “Italy At War”, from the Time Life History of World War Two series. It is mainly about “Benny the Moose” and his inner circle, and the train wreck they made out of Italy’s economy even before the war started.
It’s difficult to read now without experiencing a sort of “reverse deja vu’”; not so much the feeling that you’ve seen this before, but that you’re now seeing a replay of what happened then.
(Am I the only one who’s noticed The One’s tendency to pose like Il Duce for the cameras? Right to the out-thrust chin.)
clear ether
eon
From Merriam-Webster
Seems to fit as GM is controlled by the government and the union.
They tell the CEO and his crowd how to behave.
“Corporatism” works both ways. The corporation is looking for special favors and subsidies while the pols are looking for any way to look good. Each benefits in their own way from the illicit deal that sticks the taxpayer with the bill.
In this way, the GM deal is different from the Fannie Mae/Chris Dodd/Countrywide deal. With that deal, none of the players wanted the public to know about the special favors that each was granting to the other.
Can’t we give Obama to the Haitians ?
Great idea! But he’ll have to get in line behind Wycleff Jean…
Khan Krum. why do you hate the poor haitians?
“travels an underwhelming 40 miles before needing a charge (340 miles when the gas engine is invoked, defeating the basic purpose)”…I’m no fan of the Obama administration or of the GM bailout, but this is a pretty clueless remark. The battery-engine combination allows the car to run on electricity alone during normal commutes while not being tethered when longer trips are required…moreover, dynamic braking allows energy to be recovered rather than dissipated as heat when stopping or slowing, similar to a standard hybrid.
40 miles on a battery charge ?
….. What about running the a/c in the summer, lights at night ?
….. What about hills ?
….. Heat in the winter?
….. Li-Ion batteries are good for a few hundred charges … and the ‘capacity’ begins to fade after a hundred or so …. …. just like the Li-Ion batteries in your cell phone, iPod, laptop.
…..
…..
Pardon me, as I generally do NOT advocate more taxes …. but
….. Gasoline presently has Federal and State taxes included in the price. Money used for worthwhile purposes, like repairing roads and paying off politicians.
….. If I power my car from the garage wall outlet, then where will that ‘road tax’ revenue come from ? ….. What tax source will replace the lost taxes on each gallon of gasoline ?
“….. If I power my car from the garage wall outlet, then where will that ‘road tax’ revenue come from ? ….. What tax source will replace the lost taxes on each gallon of gasoline ?”
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Obama has already got that covered. Do you remember him saying ‘Under my plan, the cost of electricity will, necessarily, skyrocket.’.
“What tax source will replace the lost taxes on each gallon of gasoline”
You will be taxed per mile driven, which will be recorded by a meter installed on your car when you register it with the state. North Carolina has already considered this.
-Nice point.
-”It’s set to sell for $41,000, and travels an underwhelming 40 miles before needing a charge (340 miles when the gas engine is invoked, defeating the basic purpose). It seats four, uncomfortably (thanks to the battery pack down the middle).”
As a hybrid owner, it is nice to see an American made vehicle that can drive faster than 33 mph on battery power alone. And BTW, the overall milage for my hybrid is over 50mpg, so it isn’t “defeating the basic purpose” to own such a car.
-off topic, you didn’t know Kathy Nunnamaker, did you?
The Ford Fusion hybrid I bought a year ago will go up to 47 mph in electric-only mode. That was one of many factors convincing me to buy it. Of course, there is the political advantage as well.
Dear David Foster:
Ah, you’ve brought up the right topic! What we–and I do mean we because we, the taxpayers, are paying for one of the worst automotive bondoggles in history in the Volt–have in the Volt is an example of a product getting far ahead of the technology. It is a brilliant, and very expensive, solution to a problem that does not exist. In the free market, no electric car can be successful–and by that I mean, satisfying the needs of a large number of customers and thereby making sufficient profit for the manufacturer to enable it provide reasonable dividends for its shareholders–if it does not meet several criteria: 1) It must have a range similar to that of the class of car it seeks to supplant; 2) It must have performance similar to the class of car it seeks to emulate; 3) It’s maintenance costs must be similar; 4) It must not be regionally limited–it must be a viable product around the world; 4) It must be as safe, and; 5) It must be competitive in price. Let’s see how the Volt stacks up, shall we?
1) The average gasoline powered car has a range of at least 250 miles before seeking refueling, and many, 50-100 miles more. The Volt? Forty miles, and we must assume that’s under ideal conditions. Add additional passengers, activate anything that uses electricity such as headlights, turn signals, windshield wipers, radio, air conditioning or heating, carry any cargo, add anything that decreases the aerodynamics such as a bike rack and the already Lilliputian range of the Volt will decrease dramatically to what? Twenty miles? Ten? And it takes only a few minutes to fill a gas tank, but hours, at best, recharging the Volt’s battery, assuming a charging unit is available. They’re not, and they’re expensive. There’s another important factor here, but I’ll get to that in a minute.
2) Performance? While electric motors have substantial torque for their size, they surely are not capable of the top speed available to gas power vehicles, relegating Volts to short range, lower speed commutes only. Keep in mind that while a Volt may be able to reach 60 MPH, that speed would be an enormous drain on the battery. Yes, the tiny gas engine can provide electric power for additional range when the battery is exhausted, but that’s not the same amount of power available from a fully charged battery. You might well find yourself limping along at 35 MPH without the ability to use A/C or much of anything else.
3) We have no idea of the Volt’s maintenance costs compared to internal combustion vehicles. We do know that GM is saying that a replacement battery, which they claim will last ten years (I’ll bet), will cost $8000.00. That’s nearly 1/4 the list price of the car. And let’s keep in mind that the more you recharge the battery, the faster you deplete its ability to fully recharge. By the time you have to replace the battery, it may well cost more to do that than the vehicle will be worth, creating the first $41,000.00 disposable automobile.
4) Here’s the largest problem, larger even than price. When GM experimented with an electric vehicle, it was tested only in California and Arizona. Why? Temperature. Batteries don’t work in the cold. The colder the temperature, the faster the battery drains of power. Cold enough, and I’m not talking below zero, and the Volt is a very expensive paperweight. But I’ll have a heated garage or a battery heater I can plug in. Ah. And the added electric costs will contribute to less pollution how exactly? And when you drive to work, will your workplace have a heated garage, a main battery charger, and an outlet to warm your battery? The Volt will be useless in colder climates. GM isn’t talking about that one, are they? It’s hard to get around the laws of physics, even with hope and change and the best PR firms.
5) And of course, we come to price. $41,000.00 (yes, I know about the $7500.00 taxpayer subsidy) for all of the advantages I’ve already mentioned. Sounds better than sliced bread to me!
And before I go, consider, please, one more small item. Lithium Ion batteries contain elements that must absolutely be separated from each other. When they inadvertently combine, even through a pin hole, the batteries have the unfortunate tendency to burst into flame. Another reason GM ran the battery down the middle of the car was no doubt to protect it as much as possible in a collision, which would, no doubt, have the potential to create a bit more than a pin hole.
But what the heck? If the President says I won’t be patriotic unless I buy one, sign me up! What could go wrong?
I’ll start by stating I’m not a fan of Obama or his administration. Dumping on this vehicle though simply because his administration happens to support it is ridiculous. Doing so without knowing what you’re talking about only hurts your cause. Responses to your points below.
1) The electric-only range is advertised as 40 miles, and in all of GMs testing, I’m sure they’re using the AC and winshield wipers. When the battery gets low near the end of this 40 miles, the gasoline motor kicks in automatically to charge the battery. This is where the Volt is different from other electrics in that it can use gasoline as a range extender, where as other electrics are tied to their charging stations.
2) Performance. Have you read any actual reviews of the Volt? It’s been noted in quite a few reviews that performance is actually quite good. The linked wired article states it behaves as a normal sedan up to the tested 70mph. And no, “as tested” does not mean it cannot go faster. Not the reviewer purposefully tested the vehicle after the batteries were depleted. Your 35mph example is null and void.
3) Battery maintenance. The battery warranty is 8-years/100k miles. New technology is expensive, but this warranty mitigates the risk considerably.
4) No cold weather testing? The linked article contradicts your statement that “When GM experimented with an electric vehicle, it was tested only in California and Arizona”.
5) Finally, the price. Your right, $41k is a lot of money. Again though, this is a new technology that is going to be funded by early adopters and (unfortunately) the federal government through its tax credits. Until it becomes affordable enough for you to buy, you don’t have to worry about the cost.
Dear Paul:
I don’t usually engage in tit for tat in these forums, so I’ll essentially just clarify my original comments. Keep in mind, however, that my overall point was and is that the Volt is a product brought to market too soon as current technology cannot provide an electric vehicle that can actually compete with conventional vehicles. Therefore, as a simple business decision, it makes no sense. Also please keep in mind that my comments relating to the Volt in particular rather than to basic physics are based on my readings of articles about the Volt which include information attributed to GM. Yes, I have in fact, read extensively on the Volt and the related technology.
Regarding the Volt’s range, it’s my understanding that its systems will not allow the battery to discharge below a specific level of charge (necessary to protect the ability of any battery to continually recharge), thus, as you note, engaging the gasoline engine which provides charging power to the battery. However, even a 220 volt charger takes on the order of four hours (take an hour or two either way if you like) to restore the full charge. What this means is that the gas engine is going to provide sufficient power only to limp along, a fraction of the fully charged power of the battery equals a fraction of the performance at full charge. That’s physics, not GM spin. What you laud is actually a weakness because vehicle with a backup gas engine can immediately resume more or less normal operation under gasoline power; the Volt cannot. And 40 miles remains nothing to write home about.
I have, as I noted, indeed read quite a few reviews of the Volt. As to the performance being “actually quite good,” those professionals who reviewed the vehicle noted, without exception, that it was quiet, drove smoothly, and felt more or less normal, but mentioned many, if not most, of the drawbacks I listed, the short range, difficulty and time involved in charging, and outrageous cost foremost among them. My mention of 35 MPH was not presented as a hard and fast fact, but as a potential example. Even if the vehicle was capable of, say 50MPH on the charging motor, that’s still a significant drawback compared with far less expensive conventional vehicles. GM is certainly not advertising a 100 MPH top speed for the Volt, but that merely underscores another of its many limitations compared with its conventional competition.
Let us assume that the battery warranty is as you’ve described. The risk for the initial owner may be mitigated in terms of replacement, but that warranty likely applies only to the original owner, therefore, buying a used Volt with no battery warranty is going to take a real leap of faith on the buyer’s part. My point about the extraordinarily high replacement cost for batteries rendering the vehicle essentially worthless stands, merely with slightly different parameters. Even if the warranty is fully transferrable, the extra costs that represents for the manufacturer underlines the ridiculously negative manufacturing cost vs profit equation for the Volt.
Regarding GM’s earlier electric vehicle experiment, it was not my intention to suggest that none were tested in cold environments, though I may have inadvertently implied that. I know for a fact that that vehicle did undergo cold weather testing, and as a result, the vehicles that were leased–not sold–to what we would now call beta driver/testers, were all confined to the warm states I mentioned for the reasons I mentioned. Gm eventually took possession of all of the vehicles when their leases were up and destroyed them. Draw your own conclusions. Again, this issue involves only basic physics which are not confined to the Volt. If you don’t believe me, put some fresh batteries in your refrigerator and/or freezer for 15 minutes, 30 minutes, 45 minute, etc, and check the voltage with a simple voltmeter. You’ll see that cold depletes batteries at a rapid rate. Lithium Ion batteries are no different, just enormously more expensive and potentially dangerous.
“Until it becomes affordable enough for you to buy, you don’t have to worry about the cost”? Paul, that lump sum subsidy for each Volt is not the only taxpayer money relating to the Volt. Don’t forget the GM bailout and the various federal programs providing millions upon millions for exploring such technologies, all of which are, in part, coming out of my pocket and yours so that a very select group of buyers can feel that they’re defending the planet. The Volt’s battery pack is state of the art. Science makes clear that without unimaginable breakthroughs in battery power, storage capacity, weight, size, life and charge time, electric cars will never be viable. Let’s not even get into the billions upon billions of infrastructure costs necessary to make electric vehicles even remotely practical. And remember, they will never, ever be practical in colder climates without another unimaginable breakthrough that renders batteries immune to the effects of cold. That’s a large part of the US, all of Canada, and much of the rest of the world. And hey, if the Volt is such a great idea, why does the taxpayer have to provide half the cost of many reasonably well equipped compact cars just to get the Volt off the showroom floor?
Let’s compare the Volt to say, the new Ford Fiesta. Equipped with every bell and whistle Ford offers, the Fiesta costs only about $22,000 and gets 40 MPG on the highway. Its emission controls are advanced and its engine efficient and clean burning. Compared to that vehicle, and a great many others, the Volt remains ridiculously overpriced, and has significant disadvantages in every meaningful way. If GM was not owned by the Democrat party, the Volt would still be a technology demonstration project in its research division because the engineers there certainly know that it’s an interesting idea, but the technology has not caught up to the promise, and it never may. GM will lose money on every Volt it manufacturers absent those breakthroughs about which I spoke. No manufacturer can afford, for long, to lose money on its products, particularly when they know they’ll be losing that money before the first product is ever delivered to a customer.
“5) Finally, the price. Your right, $41k is a lot of money. Again though, this is a new technology that is going to be funded by early adopters and (unfortunately) the federal government through its tax credits. Until it becomes affordable enough for you to buy, you don’t have to worry about the cost.”
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Please remember that ‘the federal government through its tax credits’ is us.
“5) Finally, the price. Your right, $41k is a lot of money. Again though, this is a new technology that is going to be funded by early adopters and (unfortunately) the federal government through its tax credits. Until it becomes affordable enough for you to buy, you don’t have to worry about the cost.”
==============
Please remember that ‘the federal government through its tax credits’ is us.
All you have to say nowdays is “GM.” Once we know who makes it, we know its a lemon.
GM had the first electric car–and crushed them all.
GM had 60% or more of the auto market in the US–and lost it.
GM had loyal customers too–and blew them off.
“Mark of Excellence” my eye.
Such a shame. It was at least a decent company before the Unions got it and Roger Smith went to work on destroying what was left.
The Volt is an absolute joke.
Apologies to the nice man in a dark suit pretending to know anything about cars, who told us (as dozens of dedicated looking minions work on cars), that GM paid back its government loans.
Baghdad Bobby Gibbs’ mischaracterization of GM’s situation that led to the bailout was real laugh riot. He spoke in derisive tones about those who opposed the move as though we were set to lose millions of jobs. In retrospect, we now know that this was just a way to rescue the unions whose outrageous demands in concert with managements insistence on exhorbitant salaries help price GM out of the market.
In retrospect, we should have allowed GM to file for bankruptcy. They then would have been able to renegotiate the union contracts. However, this might have resulted in the unions agreeing to concessions, which would hurt the Democrats war chest, what with unions members having to subsist on something more in line with average wages and benefits and all.
This debacle is all about political power. It seems unless you’re a union member, you don’t have any. And with union membership nationwide at about the 10% range, this is yet another example of a minority gaining preference over the majority of Americans.
Again.
Thanks, Barack.
Chevy will also be coming out with the “Cruze” a Gas only version of the Volt. Base price will be in the $16′s, figure “well equipped” at $18K. The only question will be by what magnitude it will outsell the Volt. -S
We turned in our GMC Yukon off of lease and got a Honda Pilot. We will never buy a new GMC or chrysler until those bondholders from Chrysler and the GM stock is paid back thereby getting the government and unions out of their ownership positions. We looked at the Ford products but didn’t match our timeline for delivery and were too overloaded with unnecessary options (DVD’s and unrealistic pricing on luxury packages).
The people of America are slowly “going Galt”.
We gladly pay Billions of dollars annually to subsidize the fossil fuel industries, but woe unto those that want to rock that boat!
“the Peoples Car”
(marketing campaign)From the company destined to fail mandated by an administration destined to fail, comes the car no one wanted at a price no one can afford; The Chevy Volt. More than just sticker shock.
Come now – the Volt is a fine idea for a car and it is the design (all electric plus a reserve gasoline engine that charges the battery so you only need one drive system) that many people say should have been used for the Prius. As a first effort I am certain it will be reasonable, like the first Priuses were, and the later models will get better and better.
What is absurd is the price.
For that base MSRP one can buy finely tuned 30+ mpg luxury cars of all shapes and sizes. There is simply no reason to buy that car at that price.
There’s a reason Toyota sold the first Priuses at a technical loss, in order to work out the bugs and build the name and the economies of scale so that the later models could win the day. But of course, GM doesn’t have that kind of luxury at the moment.
Not a facetious question. A major industry is going under should the Federal Government just let it?
If yes, who has the responsibility for supporting the hundreds of thousands of people who directly or indirectly will now be unemployed?
If no, how does the Government run it better than the previous managers?
Under capitalism, companies fail based on performance or the product is no longer needed. Microsoft will eventualy close its doors one day. They all do. Should we have subsidized horse and buggy stables when the car was invented? GM was overburdened with salary and pension commitments. They would have been better off going through bankruptcy. The workers would have been rehired by the restructured company but with benefits that let the company be more competitive. Tough, but you either let the free market work or not. As it is the taxpayers got hosed when Obama took over GM.
Yes, the government should have let GM and Chrysler go into normal bankruptcy. If they shut their doors we’d all be buying Ford’s instead. The demand for cars would not have decreased if these companies had gone away, just like it didn’t go away when AMC et al. shut their doors over the last 100 years. The supply chains would have been disrupted in the short term, but they would have evolved to support whatever car companies took the place of GM and Chrysler (probably Ford would have grown substantially as a result). I can’t see any scenario where these companies will return to profitability. I’m a Ford guy myself, but I would never buy a car from either of these companies now that the gov’t is meddling in them.
“Yes, the government should have let GM and Chrysler go into normal bankruptcy. If they shut their doors we’d all be buying Ford’s instead.”
Of course, they wouldn’t have “shut their doors” — or, if they did, they wouldn’t have kept the doors shut for long. The companies would either have been transferred to their senior debtholders or auctioned off, extricating the firms from their crushing debt and contract obligations, the primary reasons the companies were losing money in the first place. GM and Chrysler would still be functioning market competitors rather than zombie corporations kept “alive” entirely through Washington’s fiscal voodoo.
Nokabosh rites:
“Under capitalism, companies fail based on performance or the product is no longer needed…….Should we have subsidized horse and buggy stables when the car was invented?”
-Our nation’s taxpayers subsidize gas, oil, and coal.
I’m not surprised. But could you provide a link? If only we could get socialism out of the Federal Government, I think we could have coexistence at the state level.
This Lemon to be is being offered at a $7.5K discount subsidized by the taxpayers sold by a company (GM) owed 60% by Obama. You will have to recharge the battery at home and that will drive up your electric bill. The electicity for the charge more than likely will come from a fossil fuel supplier source. So what’s wrong with this picture? Dumb ain’t it? The current head of GM wants the Gov’t to sell its 60% control of GM. Let’s see what Obama does. My bet is he won’t. He wants the vote of the auto workers who have a seat on the board of directors. GM will stay nationalized as long as BO is president. Had the company not taken the bailout money and gone through bankruptcy they would have been better off than they are now. They wouldn’t be selling an over priced dog car like the Volt.
Anyone else find it strange that Tesla motors has developed an electric roadster capable of 250 miles on a charge, doing 0-60 in under 4 seconds? And the Volt raves about 40 miles on a charge. Are these people crazy? Tesla is also coming out with a luxury sedan at the end of next year for around 50k with the same battery performance.
Full disclosure-not an investor in Tesla, just like the technology.
The Volt is a really dumb design compared to other electric cars. A better design I read about (the Telsa?) uses two electric motors to drive the car with terrific torque. A small gas engine is used as needed to keep the battery at full charge for the electic motors. Energy from braking is diverted to the battery as well. No need to plug a dumb cord into the battery to recharge it though that is an option. Of course, as the use of gas declines its price will rise so that the oil companies maintain their profit levels. But hey, that wil be a while as most cars on the road are still fully gas driven and will be for years to come.
The Tesla is all electric, I have seen the roadster up close-it looks like a Ferrari and runs like one, at least in the short run, doesn’t have the top end of a high end sports car.
The small gas engine charger charger is also a very good idea. You should be able to tune it to get about 100 mpg, or something close.
The Tesla roadster is expensive but with a range of 250 miles on battery power alone, it has some real world practicality. By the way, you can see pics of the tesla powertrain and the battery here.
Yes, and they ignored him Tesla back then, too.
Electromagnetic energy is a friend to all.
What would medicine do without MRI?
To see how this ends, look at British Leyland, same scenario: Government (taxpayer) subsidizes to help struggling company, Government (taxpayers) assumes partial ownership in exchange for previous bailout loans, government (taxpayers) takes over management of company, government (taxpayers) assumes all stock in company, after umpteen billions of pounds down the drain, company liquidates and is gone. Taxpayers left with nothing but regret.
The whole process lasted less than ten years I believe.
What happened to GM & AIG is a harbinger of what the gov’t will do to other commericial entities under the recently passed Finance Reform Act. That Act allows the gov’t to step in and declare a company or bank in danger of failure (as if we don’t already have regulators who are supposed to warn of that). The assets of the bank or entity will then be divied up according to the gov’t's whims and not by a court under normal bankruptcy proceedings. We are looking at a massive growth in gov’t and corruption. This Act will create more GM’s down the road.
Oh, come off it. The Volt was in development for years before the bankruptcy and federal “rescue”. It is a different and innovative path between full electric and Prius-type hybrid, and this technology deserves to be developed to see if it can in fact compete.
Had GM not gone through the wringer and remained private, the Volt would still be released. It is an uneconomical project at present, but future fuel prices and regulations may require that other automakers move in that direction eventually. We are now bearing the costs of successfully commercializing a new technology, just now in the role of shareholders since GM is partially owned by the government.
The amount invested, or wasted (depending on your point of view) is relatively modest in the whole scheme of things. It may result in lower production costs and a substantial net benefit to customers, or it may flame out. That’s the story of innovations in general.
The big wastes are elsewhere, such as the atrocious CAFE process for regulating fuel economy.
To see the future of Government Motors, study the past history of British Leyland.
The mischaracterization of the Volt’s development is staggering. The Volt would be regarded as the model of capitalism if it were not for the government bailout. And for the record I completely opposed the govt bailout; better for the entire US auto industry to fail than for the govt to interfere with the market.
Mr. Perren’s assertions to the contrary, anyone who has casually followed the development of the Volt over the past 5 years would clearly understand that this is not the government forcing a corporation to make a product the market doesn’t want (which I am wholeheartedly against), but instead a corporation consciously developing a product and revamping it’s entire bureaucratic production process in order to deliver a product to a highly competitive sector of the market as determined by the corportation.
As I recall from an article I read in the Atlantic Monthly sometime around 2006/2007 (unfortunately was unable to find a link to the article), with the Volt, GM made the conscious decision around 2005/2006 (well before the government bailouts) to shift the paradigm and develop an electric powered, gas-assist (Prius and other hybrids are gas powered, electronic assist) designed to travel 40 miles (GM study found 75% of all commuters lived within a 40 mile round-trip to/from work) and be recharged through a regular 120V household outlet overnight (when the electric grid has less demand) and put it on the market within 5 years (believe normal GM product development at the time was approximately 8 yrs). The development team had/has carte blanche to do what it takes to get this product to market. They relied on yet to be developed battery technology to be delivered at the time of initial production, betting that battery technology would develop similar to Moore’s law for computer word processing. In essence the Volt program was heralded by business observers as the epitome of the hard self evaluation a company needs to do, the changes it needs to make and the risks it has to take in an ever changing and highly competitive market. All of these decisions were corporate decisions with one thing in mind, to make money for the company. The fact that the Volt has under-delivered in the eyes of some people in terms of cost and performance is not attributable to govt intervention as some would like to contend (although I’m sure there has been some unfortunate intervention in that regards post bailout) but rather corporate over-reach in that GM over-promised what it thought it could deliver too early to the market.
Why is it that every time I read or think about GM these days I get this vision in my head of Obama on his hands and knees in a sandbox playing with little cars and mimicking the sound of an engine?
Could it be because he has about as much experience as a real kid in a sandbox?
Next thing that comes to mind is an old saying – some idiots can break a crowbar in a sandbox…
I owned an AMC Hornet back in the day. This car reminds me of the AMC line. Remember the Matador???
Hey, don’t knock AMC. I bought a 1965 Rambler in 1977 and drove it until 1986.
Not the flashiest car (O.K., it was ugly)or the fastest, but it was good honest transportation that ran cheaply (both in gas consumption and repair bills) and could be trusted to drive through Canadian winters.
I haven’t owned a car since, but I’m thinking I may try an electric. The Volt is a bit of a mess and owes its life more to the film “Who Killed The Electric Car” than it does to Barrack Obama. I’m thinking of a Nissan LEAF.
As for the fact that much US electricity comes from coal, I can’t help wondering if one coal smokestack can replace 2 million car exhausts then electricity from coal might not be so bad.
I owned a Hornet wagon back around 1990 or 91, I think it was. It was my second car and I loved the thing. It was big, it was ugly, it was crap on gas, the throttle got stuck fully open one day in rush hour traffic, and I loved it.
Which probably doesn’t make much sense at all, but is true nonetheless.
One of the worst things done in the GM takeover that no one has commented on adequately or even at all — the debtholders were subordinated to the employee unions. That sounds innocuous, but consider that all of capitalism depends on the sanctity of contract law. At the whim of Lord Obama (evil twin to Lord Voldemort, who is, by comparison, a relatively clean person), GM’s debt contracts (bonds) were nullified.
There was no legal basis for this. And out of abject fear, none of the debtholders contested it in court… Why? Because the commandment came from our absolute ruler in the White House. You can’t speak against the edicts of the God in Chief, can you?
Out of stupidly abject shortsighted greed, the shareholders didn’t object, of course, because they were facing 10 cents on the dollar for their stock if GM went bankrupt, and they were calling in every political marker they could to get the government to buy out the company and save their sorry asses.
There was not a single principled action by anyone concerned. So goes the decline of freedom in this world.
The consequences if GM had gone belly up?
1.) Stupid investors who believed GM a safe bet would have been out a lot of money. (Read Atlas Shrugged, and pay special attention to the run on d’Anconia stock.) I don’t call this a bad thing. I call it justice. The other concept destroyed in this pathetic melodrama, besides “rule of law”, “property rights” and “capitalism”.
2.) The union contracts would have been nullified (Obama would have lost a lot of supporters), and autoworkers would have been forced to work at a competitive wage — or get another line of work.
3.) The plants and equipment would have been sold off to more efficient manufacturers. Capital would have been more efficiently allocated.
No one would have died. The world would have gone on. But GM would have ceased to exist as a corporate entity — a collection of legal documents and a management hierarchy. The productive engineers, managers and laborers would simply have gone into more efficient businesses. The physical buildings would have remained standing, waiting for someone else to occupy them.
The biggest change for everyone not affiliated with the company: the GM brand would have disappeared. A name. A long-dead rose and nothing more.
I take exception to your comment “stupid investors who believed GM a safe bet”. If the (In)JUstice Dept had followed federal bankruptcy laws they would have been safe investments for the bondholders. But, like everything else involving Obama and Holder, they turned the laws upside down and inside out giving the company to the UAW instead of the legally entitled bondholders.
Maybe someone can explain how they got away with that.
Well, there was the Volkswagen, subsidized by the Nazis, or the German Volk through their taxes that went to subsidize the carmaker(although the Volkswagen or “People’s Car” never went into mass production before the collapse of Nazi Germany), and now the “Voltwagen,” subsidized by Obama, or by the American taxpayer. Anyone see any “Ominous Parallels” here? This is a “car” (must we call it a “car”?) that fits the American lifestyle like bronzed baby shoes would fit Fred Astaire’s tap-dancing feet. And perhaps that’s the purpose — to force Americans to plunk down $41,000 plus tax and other fees and surcharges for a car that would not so much crimp their lifestyle as destroy it. Gee, maybe Americans would get a “tax credit” for buying one — that is, get some of their confiscated income back from the government — which “refund,” of course, would need to go through a variety of taxpayer-funded bureaucracies. Ain’t life grand under the Obama regime?
Ugh! Where do you start with this issue? The whole thing stinks. Jeff does an excellent job outlining the national economic and political pitfalls of this issue and those commenting are focusing on the pros and cons of the techology itself. But I have a couple of simple practical questions that I’d like to pose to current Hybrid owners and to Environmentalists.
(1) To the environmentalists and the Hybrid owners who want more mpg:
How and why do you think that a car with multiple engines is efficient?
I assume that the goal here is to find a simple, easily implemented, cheap and relatively clean solution to high petrol prices and pollution.
Surely the answer is to install a propane auxiliary tank to your existing car engine and run your car on a cheaper fuel. Most of the Midwest and California is flat and you don’t need 350 hp to make a sub-compact (or even a truck) to do the speed limit on the freeway. Propane is fairly plentiful and cheap in the US and it burns cleaner than diesel and gasoline. Moreover, the technology is available now and has been since the 80s.
Seriously, you folks who love hybrids and progressives must see that this technology isn’t a solution to an environmental or an economic or even a practical problem. It is a solution to a political one that has been perpetuated by Republicans and Democrats. And that problem is that Americans (individuals and companies) aren’t free to find the best solutions to our problems.
I mean if you want a non-fossil fueled car with a power to weight and range to payload ratios better than petrol engine, why aren’t you developing an engine that runs on a non-fossil based, energy dense fuel? Hydrogen anyone? If you were a car company freely able to develop in any direction you wanted, wouldn’t that be where you would sink your billions?
Or is it now a case that punitive taxes and regulations (levied by Republ-ocrats) are making it impossible and unprofitable for businesses to plan long-term?
(2) To the Environmentalists:
If you really want a green car, why in the hell are you supporting the use of batteries that are filled with heavy metals that (a) need to be dug out of the ground (b) need to be refined and (c) need to be disposed of safely once you are done with them? To say nothing of the coal that is used by the power-plants your plug in will rely on.
(3) To the Environmentalists and the Hybrid owners:
Let us assume that you can (in good conscience) ignore the fact that a new car looses 50% or more of it’s value when you drive it off the lot.
What resale value are you expecting from your electric/hybrid when at around 100,000 miles you are obligated to overhaul the batteries at a price approaching the resale value of the car? I suppose that if the movement takes off, the replacement batteries may come down in cost, but they still won’t be free (Hey Mister, can I have more cadmium & mercury please?) and you still have an internal combustion engine that needs timing belts, head gaskets, water pumps, alternators and all the other fun things that break on standard second hand cars.
Remember, a Prius has the same horse-power as a Kia Rio but is a hell of a lot heavier. Without a new battery pack, your second-hand Prius isn’t going to out-last a Rio in an endurance race and a second hand 2003 Rio is worth about $2000 to $3000 with 150,000 miles on the clock.
So what you might ask. Well two points: (1) a new Rio is about $10,000 so you can expect to recover maybe 10-20% of it’s value when you sell it. Tell me again how much your second hand Prius or Volt will net you on the second hand market?
(2) If you really do believe in Green values, you should be supporting anything that can extend the life-span of durable goods rather than shorten it. Because even when you recycle, you still use energy and produce pollution.
And given the answers to the questions above, tell me again what a good idea it was/is to subsidize hybrids with tax-payer money either as direct ownership of car companies or Cash for Clunkers deals or R&D prizes.
Ugh! Where do you start with this issue? The whole thing stinks. Jeff does an excellent job outlining the national economic and political pitfalls of this issue and those commenting are focusing on the pros and cons of the techology itself. But I have a couple of simple practical questions that I’d like to pose to current Hybrid owners and to Environmentalists.
(1) To the environmentalists and the Hybrid owners who want more mpg:
How and why do you think that a car with multiple engines is efficient?
I assume that the goal here is to find a simple, easily implemented, cheap and relatively clean solution to high petrol prices and pollution.
Surely the answer is to install a propane auxiliary tank to your existing car engine and run your car on a cheaper fuel. Most of the Midwest and California is flat and you don’t need 350 hp to make a sub-compact (or even a truck) to do the speed limit on the freeway. Propane is fairly plentiful and cheap in the US and it burns cleaner than diesel and gasoline. Moreover, the technology is available now and has been since the 80s.
Seriously, you folks who love hybrids and progressives must see that this technology isn’t a solution to an environmental or an economic or even a practical problem. It is a solution to a political one that has been perpetuated by Republicans and Democrats. And that problem is that Americans (individuals and companies) aren’t free to find the best solutions to our problems.
I mean if you want a non-fossil fueled car with a power to weight and range to payload ratios better than petrol engine, why aren’t you developing an engine that runs on a non-fossil based, energy dense fuel? Hydrogen anyone? If you were a car company freely able to develop in any direction you wanted, wouldn’t that be where you would sink your billions?
Or is it now a case that punitive taxes and regulations (levied by Republ-ocrats) are making it impossible and unprofitable for businesses to plan long-term?
(2) To the Environmentalists:
If you really want a green car, why in the hell are you supporting the use of batteries that are filled with heavy metals that (a) need to be dug out of the ground (b) need to be refined and (c) need to be disposed of safely once you are done with them? To say nothing of the coal that is used by the power-plants your plug in will rely on.
(3) To the Environmentalists and the Hybrid owners:
Let us assume that you can (in good conscience) ignore the fact that a new car looses 50% or more of it’s value when you drive it off the lot.
What resale value are you expecting from your electric/hybrid when at around 100,000 miles you are obligated to overhaul the batteries at a price approaching the resale value of the car? I suppose that if the movement takes off, the replacement batteries may come down in cost, but they still won’t be free (Hey Mister, can I have more cadmium & mercury please?) and you still have an internal combustion engine that needs timing belts, head gaskets, water pumps, alternators and all the other fun things that break on standard second hand cars.
Remember, a Prius has the same horse-power as a Kia Rio but is a hell of a lot heavier. Without a new battery pack, your second-hand Prius isn’t going to out-last a Rio in an endurance race and a second hand 2003 Rio is worth about $2000 to $3000 with 150,000 miles on the clock.
So what you might ask. Well two points: (1) a new Rio is about $10,000 so you can expect to recover maybe 10-20% of it’s value when you sell it. Tell me again how much your second hand Prius or Volt will net you on the second hand market?
(2) If you really do believe in Green values, you should be supporting anything that can extend the life-span of durable goods rather than shorten it. Because even when you recycle, you still use energy and produce pollution.
And given the answers to the questions above, tell me again what a good idea it was/is to subsidize hybrids with tax-payer money either as direct ownership of car companies or Cash for Clunkers deals or R&D prizes.
“Oh, come off it. The Volt was in development for years before the bankruptcy and federal “rescue”. It is a different and innovative path between full electric and Prius-type hybrid, and this technology deserves to be developed to see if it can in fact compete.”
Newsflash: It can’t.
I’m confused. I looked at the picture with the caption ‘Lemon’. Are we talking about the car or the person standing next to the car?
Both.
I noticed volkswagon is going to make a dip into the electric car pool.
I imagine every car designer has, at one time, doodled out an electric car, but the profit margin was too small…
along comes the federal govt, which is providing a 7500 dollar coupon for gm’s model. Love to know the profit margin that provides. I’m imagining that the margin is ‘less’ than 7500 dollars.
volkswagon probably expects that once they roll out their model, the coupon will be smaller, but given the parameters to justify the 7500 dollar coupon, they are probably expecting a 2500-4000 price assist.
so how does this work? vw lets the govt/unions(77% of stakeholders in gm) prep the market for an electric car, watches the complaints, adjusts design accordingly, and releases their own model.
vw knows the production cost of the volt, and also knows that the govt will be unable to drop the coupon rate below a certain threshold, where profits for gm would evaporate. eventually, the vw product will cut sales of the volt in half, and find themselves produing a better vehicle, at a lower cost, and turning a better profit margin than gm.
gm, or the govt/unions, should enjoy their growth, as it will be short-lived, and quickly consumed by better companies, making better models.
I think that most people commenting here can agree that the bailout for GM was the incorrect thing to do.
That said, this article is a hatchet job in which the author of the piece has clearly not verified even the most basic assertions.
“Yet another example of crony capitalism rolls off the assembly line soon, in the form of the GM Volt — an electric hybrid that’s absurdly overpriced and woefully underperforms.”
It doesn’t count as “crony capitalism” if the Volt was in development well before the bailout, as multiple commentators have noted.
“It’s set to sell for $41,000, and travels an underwhelming 40 miles before needing a charge (340 miles when the gas engine is invoked, defeating the basic purpose). It seats four, uncomfortably (thanks to the battery pack down the middle).”
It travels 40 miles on a charge – which happens to be within the average of a daily commute. It also has the gas engine to extend its range when traveling larger distances. It is not an all electric car and was never intended to be such.
“Not satisfied with violating bondholders’ rights during bankruptcy proceedings, Obama twisted GM’s arm into producing the car, despite a lack of projected demand to justify the investment economically.”
Gee, that same lack of demand was the curse of Toyota’s Prius as well, long long ago. I still suspect that they are at best breaking even on it. It still generated excitement for the brand and their innovation at trying something new, which has doubtless generated sales. That has been something sorely lacking from GM and something they desperately need beyond endless rows of boxy SUVs.
I may not like the Volt. I may not drive the volt. And I sure as heck can’t afford the volt – but it seems a step in the right direction. A car that doesn’t require fueling for 5 days out of my average week is something I could get used to. And speaking about that back seat – it may only fit 4 people, but generally speaking the 5th person in the car is likely to be as uncomfortable in the average sedan as they would be sitting on that blasted battery pack.
Two other points.
1. The volt requires high octane premium gas, so you will be paying maximum prices at the pump.
2. Gasoline has a shelf life. You know how when you put your snowblower away for the summer or your lawnmower away for the winter you are supposed to drain the gas and put in engine stabilizer? That’s because old gasoline breaks down into engine clogging varnish. Regular cars don’t have a problem because you are continually replacing the gasoline. But if you only make short commutes in your volt for six months or so, then set out on a long trip and the gas engine kicks in full of old, deteriorated gas … think the warranty covers the necessary teardown and rebuild of the engine?
Premium is recommended, but GM clarified that the combustion engine in the Volt has a knock sensor and the ignition timing is adjusted accordingly if you run regular unleaded.
GM is aware of the potential problem with stale fuel and has said that they have a solution. Modern flex-fuel systems constantly monitor the chemical composition of the fuel (it’s pretty cool technology and involves an infrared spectrometer) and the engine control computer adjusts the fuel injection, ignition timing, and valve timing (on cars with VVT) accordingly.
And considering that the demand for cars would have remained relatively unchaged (ignoring the suddenly unemployed), the surviing car companies – including Chrysler – would have suddenly seen increased sales, thus rewarding the companies that had run their business better, even if only slightly better.
Of course it would have sucked to be laid off. Especially if you are a 50 year old, high school educated person making $100K a year to work on an assembly line. But that’s why I would have preferred to have seen the company allowed to fail, and if anything at all was done by the government, provide training, scholarships, etc. for displaced workers to re-allocate resources into fields that actually need more employees. This would have cost a fraction of the bailout, and the fact of the matter is, we’re going to end up in the exact same situation eventually anyway. It’s just a matter of time.
It’s a little unfair to say that the car only has a 40 mile range and then the engine kicks in “defeating the basic purpose”. Most car trips are less than 40 miles, therefore most car trips would be run on electric power only. That said, even though the concept intrigues me, there is no way I would buy this car. It is too small and too expensive. Pile on the government take-over(stealing), and you couldn’t give me this car. I won’t make a deal with the devil.
It’s sad how so many have taken my friend and colleague Ed Niedermeyer’s critique of the amount of gov’t funding that has benefited the Volt as an excuse to ignorantly tee off on what is a promising technology – range extended electric vehicles.
Yet another example of crony capitalism rolls off the assembly line soon, in the form of the GM Volt — an electric hybrid that’s absurdly overpriced and woefully underperforms.
Underperforms? You know this from what? Have you driven one yet?
It’s set to sell for $41,000, and travels an underwhelming 40 miles before needing a charge (340 miles when the gas engine is invoked, defeating the basic purpose).
Why underwhelming? About 80% of Americans drive 40 miles or less per day. Also, because the gasoline engine runs at a steady RPM, with a steady load from the generator, that’s an ideal situation for a combustion engine in terms of fuel economy. The batteries’ control electronics will not allow them to discharge below a certain point and the engine/generator will kick in then. However, there will still be significant charge available from the battery pack and if needed, it will be called upon to provide power for acceleration or hills. The generator setup is scaled to provide enough power to keep the car moving. At highway speeds that’s not a lot of horsepower, as low as 15 or 20 with some particularly aero cars.
Add all those factors and you end up with about 50mpg when running on the engine/generator. 50 miles to the gallon when running on the genset is hardly defeating the purpose of a EREV.
I love high performance cars and think the 638 horsepower ZR1 Corvette is the bee’s knees. I also, though, like all kinds of cool technology and I’d like to see if GM and other companies (Fisker is one) that are developing serial hybrids and EREVs can succeed.
People’s hate of government involvement in the auto industry has clouded their judgment about the true merits and flaws of the Volt.
It seats four, uncomfortably (thanks to the battery pack down the middle).
And you know that it’s uncomfortable because you’ve sat in it, right? The Volt shares platform hard points with the Chevy Cruze that seats 5 with a rear bench seat. From the size of the battery pack (I’ve seen one in person) and the video that I’ve seen of the Volt’s preliminary assembly leads me to believe that the two remaining back seats undoubtedly have more room than the two outboard back seats in a Cruze have when there are three adults sitting in the back of the Cruze.
Putting aside Treasury’s stake in GM, the company happens to be making some very competitive product these days.
In his science-fiction novel “The Door Into Summer,” Robert A. Heinlein included a looney bit of satire in which a government-subsidized automobile manufacturer builds cars which are then crushed unused, or barely used.
It’s already happened with one electric car…
Yeah. We should forget about these ridiculous cars. When they are up to par we can buy them from China.
The only problem I have with GM is I want a Corvette. But I won’t go near that company. You know the bond holders will never be compensated, so I’m done. Can’t support such tyranny. Adios, I’ll miss you.
This piece yet again makes the mistake of conflating a critique of the Volt as a product with criticism of the government takeover of GM.
The Volt’s 40-mile battery range is 39.999 better than the Prius, which is its direct competition. The Volt is more expensive because there’s more in it. Does it have technical deficiencies? Sure, but nothing that makes it a fatally flawed product.
Why does the Volt exist? Not because of the GM takeover, though it probably would have died had the company been dismantled and sold off.
It exists because of CAFE rules. And it’s CAFE that’s the real government intrusion into the free market.
Lessee if I have this right: a $41K car, even a #33.5K car after the $7.5K tax credit, is about 30% higher than an average Joe’s new car purchase. So only the wealthier toffs will be able to afford it, and only such people who pay a lot of taxes to begin with will be able to take full advantage of the $7.5K credit. So what we have here is means-testing in reverse — if you’re wealthy you get the tax bennie. If you’re not, you either can’t afford the car, and/or you can’t take the full $7.5k bribe.
I’ll never buy another GM. Never.
I propose it be rebranded forthwith as the
Chevy Volk
“Gasoline has a shelf life. You know how when you put your snowblower away for the summer or your lawnmower away for the winter you are supposed to drain the gas and put in engine stabilizer”
JMS, GM thought of this. This car was designed in the land of snowblowers and snow machines in the winter and boats in the summer.
The Volt’s software monitors the age of the gas in the tank and will burn it over time even if the user never goes more than 40 miles between charges. Of course few people never ever drive more than 40 miles.
The Volt was started as a pure capitalist project during the Bush administration.
It’s a parade that Obama has jumped out in front of. There is as much reason to blame Bush for the Volt as there is to blame Bush for Deepwater Horizon!
Instead of reflexively attacking the Volt because Obama likes it, conservatives ought to be praising it as a product of the Bush administration, back when we had capitalism in this country!
So the Volt “burns off” your high-octane gas if you don’t use it.
Holy crap! That is downright hysterical!
I commute a steady 20 miles per day. 10 miles to work, 10 miles back. I rarely travel more than 40 miles in a day. Rarely as in, perhaps two times a year. We are a two car family, and when we take any family trips, we take the wife’s car, which is the more comfortable ride.
The only reason I can think of for buying a volt would be to maximize my smugness emissions — smirking at all those pitiful fools burning gasoline and filling the air with carbon dioxide while I drive to work in my magically clean Volt, listening with deep concern to the latest NPR story about how mercury emissions from coal power plants are contaminating the atmosphere, and thinking that someone ought to be doing something about that.
My mind drifts to worry. My electric bills have certainly gone up since I’ve bought this Volt. I look at the gas gauge. Getting low again. Engine must be burning off that high-octane gas again. Time to stop at the gas station and refill the tank at $3.21 per gallon. (Today’s actual gas price in Chicago.)
Well, at least I can console myself that the gasoline I’m burning isn’t being used to power the car. It’s being used to, well, clear the gas tank for the next batch of the most expensive gasoline at the service station.
Who the hell designed this? The government?
The gas engine is designed to run for a short time at least once every 60 days, just to keep things circulating: http://gm-volt.com/2010/02/18/chevy-volt-gas-engine-will-run-every-60-days-no-matter-what/ . It isn’t designed to burn off a whole tank of gas, and they use a special pressurised zero-evaporation tank so the gas should stay usable for a very long time.
Presumably, as the engine “burns off” the aging gas, it uses it to charge the batteries, which would then reduce the amount of electricity used the next time you plug in. So it’s not just being dumped for no gain.
At least when Hitler ordered the car companies to build a “peoples car”, they ended up with a car the people actually wanted to buy!
The sad part about the Volt is that the final chapter has yet to be revealed.
Trust me on this on this one because I know that this wont end until they make all other cars illegal and establish the Volt as the “new federal standard automobile”.
( Hey Ed! – Didja ever see the WWII fighter made by General Motors, called the XP-75 Eagle? Described as “the wonder plane” in the press of the day, one look at it and can see that it screams “BAD IDEA”:
http://en.wikipedia.org/wiki/Fisher_P-75_Eagle
Hmmm. The P-75 Eagle, the Pontiac Aztec, the Chevy Volt. I’m not Dr. Gregory House, but it seems that there is something in the water there in D-town. )
I have been a GM man almost my entire life. I’ve owned Chevrolets, Corvettes, Buicks, Pontiacs and Cadillacs.
I guarantee you that I will never buy another GM car as long as the company caters to the government. I most certainly will not buy a Volt, an overpriced POS. If you don’t know what that acronym means, here’s a hint. The P stands for piece.
It is shameful to see GM sucking up to the government. They should have declared bankruptcy and re-organized themselves, getting rid of all unions.
They should have named the car 0y! GeVolt.
“and travels an underwhelming 40 miles before needing a charge (340 miles when the gas engine is invoked, defeating the basic purpose)”
I have to disagree with your conclusions here. It’s my understanding the short range of the Volt is due to a small battery, the intent being that it act more as a capacitor than a battery, with the engine running at peak efficiency to charge it for situations where the engine can’t produce enough electricity to drive the motors. The Volt may be a piece of crap, but the concept (similar to locomotives, which are extremely efficient but don’t have to deal with stop and go driving) is actually pretty good, and probably the best way to build reasonably priced ultra efficient cars over the short term.
Yes, you’re correct, but if it’s any consolation, at least its not a race based fascism (discounting, of course, reverse, racism.) In that sense, we’re more like the musical Italians of WW2 who liked their Jews, and just tagged along with the Germans. The Germans, of course, had to count and classify everyone by race and ethnic origins to ration out the goodies, kind of like the American Census every decade.
For all of you “rah-rah-rah-hybrid folks…
Guess where the vast majority of that Lithium comes from!!
China (which has about 10% of the world’s resource) – not particularly America friendly.
Bolivia (which has about 80% of the world’s resource) – whose President is riding the same “Death to America” bandwagon as Venezuela’s Huge-ego Chavez and Iran’s Armageddon-eye-jab.
So we are going to move away from paying the Saudi’s (who want to fly airplanes into our buildings) for oil, to paying for South American dictators who want to kill us.
Sounds reasonable to me…but then again I like crunchy peanut butter on bratwurst.
Oh…and buy the way…the reason that Comrade Barry is still banning all offshore drilling is so that eventually we’ll have to go to Cuba to get a lot of our oil. Seems he’s more comfortable with shackling us to the Castro brothers than letting us produce our own oil.
Don’t even for one minute think THAT will change either.
To all the people concerned about who gets the big Lithium cash, there is only about 23kg of Lithium in the Volt’s battery, which costs about $180. Compare that to how much the Saudis get from you every time you fill up with gas over 10 years or so.
The problem is that no one knows what the next success is going to be. But the last failure – that is easy. So failure is subsidized. Because failure is obvious.
People act like the only way you can get great gas mileage is with a hybrid or electric. My Prizm (Corolla clone) gets around 40mpg on hwy. There are a lot of cars that get great gas mileage. It’s also proven that increasing efficiency (mileage) doesn’t decrease fuel usuage, it increases it…same with light bulbs…switching to those CFL’s have already been proven to NOT decrease electric bills, same with efficient washers and dryers…they get used more, BECAUSE, they’re EFFICIENT, right!?
I guess I don’t get the Left’s fascination with this “electric car” fantasy. Once you recognize how we usually generate electricity in this county, the reality is that the Chevy Volt runs on coal. Oops!
Not in the to distanced past, Californians found themselves without electricity each evening when everyone came home and cranked up the Air Conditioning, now add all these electric cars being plugged up each night. Coupled that with electric bills doubling or more once Cap $ Trade is passed (Per Obama) who can even afford to drive one of these monsters? Not to worry Nancy still flies in comfort on our dime, gee isn’t sharing the wealth grand. Anybody been to Spain lately, or even had a vacation?
We should call it the voltwagen.
Funny. I just read a blurb on the Puppyblender’s spot that we are having a lot of blackouts this summer. Naturally these blackouts are mostly in the states with somewhat leftist governments where they can’t build power plants because of the “environmentalists” Y’all please pardon me for bein’ a pore dumb redneck but with the electric infastructure already straining and sometimes failing at the load we already have, do you really think it’s a great idea to add to the demand?
Oh well, I live in Texas. We can always jack up the rates at which we sell electricity to you oh so smart people in California and suchlike environmental paradises.
One of the sad parts about these electric cars is the incompetent marketing (but I repeat myself) that insists they must be four passenger family cars. The technology simply isn’t capable of it. Where is the little one person electric runabout that can get me to work 4 days out of five while I leave my big car at home? Reduce the weight and the size of the battery gets a lot smaller that reduces the weight even more. All I insist on is reasonable safety with a roll cage. A clever design would allow either electric or gasoline engine power as options when purchased to get the advantage of higher production rates and lower costs. This is getting close:
http://www.bmwblog.com/2009/10/09/bmw-unveils-clever-concept/
Yet another example of what the consumer needed, what the analyst thought they needed, what the government said was needed, and what ends up is a horrible, over priced auto mobile that won’t sell, and will end up being a looser. And who ended up paying for this MISTAKE…. you guessed it… you and I the taxpayer…. when will this madness stop. Government, stop lying to us….. Corporate America… stop lying to us…. Politicians… stop lying to us…. hummmmm guess if the politicians stopped lying, there would be no more speeched from them…
I wrote about corporatism recently on my website.
It all started to go down hill when Corporations became protected under the Bill of Rights and the 14th amendment as “Natural Born Citizens” this gives them the right the petition the government and all other rights of an individual citizen.
It was not always like this, i go into much more detail in my article here:
http://www.upfordebate.us/story.php?title=corporate-america-the-real-enemy-of-the-state-1
I take an early look at the history of corporations in America and give a few different examples from the modern era. I thought you might want to take a look at this. Thanks for the good read.
If you charge VOLT at home and work with electricity, WHICH IS NOT FREE AND NOT CLEAN, then the life of the BATTERY COMPARTMENT SHORTEN DRASTICALLY, if you plan to replace batteries every 2 to 3 years for $10000 then buy a VOLT.
If you will charge GM Volt battery at home and work, with electricity, which isn’t cheap and clean, the life of battery set will be reduced drastically.
If you decide to buy an $8000 to $10000 battery set every 3 to 4 years buy a GM volt.
Overusing the hybrid car battery can dramatically shorten the battery life span.
Coal is used to create almost half of all electricity generated in the United States. …
Who Needs a Hybrid When You Can Have a Diesel?
Volkswagen Jetta TDI turbo-diesel delivers 50 mpg.