September 10, 2012

REPORT: GM Loses $49K On Every Volt It Builds.

You know, this is kinda making me want to buy one.

UPDATE: Senator Blutarsky says that Reuters is wrong.

ANOTHER UPDATE: Popular Mechanics editor Jim Meigs writes:

Actually, Glenn, you’re exactly the kind of guy who might be interested in the Volt: A classic early-adopter who isn’t afraid to take a risk on new technology—even if the financial payback isn’t crystal clear. Didn’t you used to drive a car with a Wankel engine? And rumor has it that a Toyota Highlander Hybrid still graces your driveway….

It’s true that the Volt is falling far short of sales expectations. But calculations that GM loses $49K on each one it sells are a little over the top. Former GM exec Bob Lutz (no friend of squishy-minded environmentalists) unloads on that idea in this piece. Bob is always quick to remind critics that the Volt project long proceeded the Obama presidency. And whatever you think of the GM bailout—or the current administration’s energy policy—you have to admit that the Volt is a pretty impressive engineering achievement. True, it might not stand up to a sharp-pencil economic analysis in terms of consumer value. But neither do most high-performance or luxury cars. Does a Porsche 911 make economic sense? Does anyone really need an Audi A7? Some people passionately desire a car that goes 0-60 in under 5 seconds. Others might like the notion of going a month or two without filling the tank.

I’m happy to see both types of people indulge their preferences. (Sure, we can argue about the fairness about Federal rebates for EVs. I’m still looking for my horsepower rebate…) But the notion that the Volt was cooked up in the West Wing of the White House shows a limited understanding of how auto development works. The Volt might or might not be the future of transportation. But it seems churlish to cheer for the failure of such an ambitious experiment in automotive engineering. Who knows, if gas prices keep going up at the current rate, even a lot of Volt critics might be taking a second look.

Well, the original error was with Reuters, of course. But yeah. Meanwhile, reader Pat Dooley says the Ford Energi is a better buy. I was holding out for the plug-in Prius.

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