Volt Birth Watch 34: Lutz Gives Up on a $30K Volt

Justin Berkowitz
by Justin Berkowitz

At a special session for bloggers– accessed by TTAC after RF's personal appeal to Maximum Bob– GM Car Czar Bob Lutz said he's "given up on a thirty-thousand dollar Volt." In fact, even priced closer to $40k "we're not going to make a dime on the Volt for years." Lutz dismissed any concerns about profitability, labelling the electric – gas hybrid "an eco-flagship." The new pricing strategy: a tax credit or rebate to get the consumer's out-of-pocket expenses in the "lower thirties." While millionaire bankers and movie stars have flocked to the Prius for its earth-saving cred, the real reason for its strong sales numbers: the price starts in the low twenties. So Lutz' dream– that consumers will pay $35k+ for a grocery-getting Volt– seems a little… futuristic.

Justin Berkowitz
Justin Berkowitz

Immensely bored law student. I've also got 3 dogs.

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  • Joeaverage Joeaverage on Mar 20, 2008

    I don't see why this thing would be so expensive. It could be an average car with existing hybrid technology ($4K premium) with a larger battery. Where do they get $40K-$50K? It could be a Corsa engine with a huge flywheel alternator, feeding an oversized battery with no direct mechanical connection between the gas engine and the electric motor. Some of the EV1 technology (motor & electronics) ought to carry forward. I recently read an article about an advanced Li-Po battery pack for ~$9K to carry a small car 50 miles at 50 mph. So adding a $10K premium to the price of this thing ought to still keep the price near $30K if it was based on an existing small car. GM ought to sell them near cost so they can pay for the technology and later turn a profit when the technology (research, manhours, tooling) is amortized. Isn't that a version of what Toyota did with the Prius? Aren't the Prius plug-ins a version of the Prius with a larger battery? Does the Prius engine decouple from the electric motor during battery drive? That is all GM would have to do to make a Volt. I see two possiblities - GM made the mistake of starting a whole new vehicle program instead of hybridizing an existing vehicle. That means all new platform, all new interior, all new exterior panels, and possibly all new suspension, etc. Expensive! Or they could have taken an existing small car (Aveo, one of the Opels like a Corsa or Astra) and added the hardware to make it a plug-in hybrid. The other possibility is that they needed the green wash for the press and the gullible consumer so they put together a customer concept car which proves they have the vision but not the gumption to BUILD the interesting concept cars - and never really planned to build it in the first place. Talk green, sell SUVs. Well, I guess there is a third possiblity... Build very expensive rich guy plugin hybrid cars and sell them at a premium like Tesla is doing. Later repackage the platform in less sexy clothes and sell it to the masses (same cost as the $50K version, smaller margin, less appeal so they don't endanger the expensive version). I think they really fear going down the path of desireable small cars or EVs b/c once the consumer gets a taste of them a certain group of those consumers will never go back to the big hulking SUVs that cost $120 a week to operate on gasoline vs the $3 for the EV.

  • JT JT on Mar 20, 2008

    "I assume by the time the Volt is out the next prius will be for sale also/ that could be a killer for GM."-- yournamehere Bit of deja vu here for me. Long time ago, 1989 or 90-ish, I attended a GM dog-and-pony show at which the upcoming Saturn line was ballyhooed. The PR flack proudly announced that the company had taken the 1988 Civic as the benchmark for the first Saturns. When the vehicles appeared in 1991, (I got to drive an early production model) they had plainly hit the benchmark; they were selling the equivalent of the 3-year old Civic. Of course, by then, the Civic had moved on. It looks like the Volt/Prius debate may play out the same way. /JT

  • John John on Mar 20, 2008

    The unmentioned Volt failure is styling: GM completely missed the tastes of that market segment. This car would look perfectly at home on any Saturday morning cartoon show. Sure, as a flagship product, they wanted it to look cool as well as be techically advanced. But show a Volt picture to 10 early hybrid adopters (Prius drivers) and 8 of them will likely say "it looks like a dorkmobile and I wouldn't be seen in it much less buy it." Not that Prius isn't a dorkmobile in its own way. But the Prius buyer overlooks that fact because at least the car is understated. You don't expect some high school kid in sunglasses to hope out of it and say "What's up, Dude!" So to sell many of these Volts, they are going to have to extend its appeal to a new group of potential customers.(a trick that has eluded Toyota so far) I just don't think that the market for in-your-face styling would put a priority on what a hybrid offers. They get more bang for buck elsewhere. John

  • Frank Williams Frank Williams on Mar 20, 2008
    John The unmentioned Volt failure is styling: GM completely missed the tastes of that market segment. This car would look perfectly at home on any Saturday morning cartoon show True, if you're talking about the concept. But no one knows what the production Volt will look like. When they put the concept in the wind tunnel, it was so aerodynamically challenged that even Lutz said it was more aerodynamic going backwards and they were going to have to come up with a different design. They haven't released any clue what it'll look like once it finally hits the street, but I wouldn't be surprised if it looked quite a bit like whatever the Malibu of that year looks like.