By on August 27, 2008

There are 98 more that GM could useAs Detroit gears up for the beggar-bowl bailout-fest, the Volt is taking center stage as, well, the only reason to invest in Detroit's future. We already know that GM is pushing hard for consumer tax breaks to bring high-flying MSRP estimates down to earth, but it seems production incentives will be the first Volt-related handouts out of the gate. MLive.com reports that Flint's city council has approved three tax incentives worth tens of millions of dollars to bring Volt engine production to the rustiest town in the rust belt. GM's Volt engine plant is expected to cost the company $359m before incentives, and will "preserve" some 300 jobs. The exact cost to Flint taxpayers is as yet unknown, but the city is clearly bending over backwards to reinvent itself as the home of Detroit's energy-efficient renaissance. Flint has agreed to cutting 50 percent of the Volt factory's real property taxes, saving GM $6m, but also bringing in $6m in new property taxes… so far, so tax-neutral. But the city council has also agreed to abate 100 percent of the new factory's personal property taxes, meaning all factory equipment would be tax-free until 2033. Savings to GM from this measure are as yet unknown, but are expected to eclipse the $6m in real property tax savings. The city also agreed to designate the site of the factory a brownfield redevelopment site, making it eligible for state incentives which GM is still pursuing. Flint also approved a fourth undefined tax break to extend the renaissance zone through 2023 for the existing Flint Tool and Die plant. Complaints from a former local NAACP leader that such incentive mean that the Volt engine will be "built on the backs of the working poor" went ignored, as the eco-friendly backslapping from industry and government carried the day. This, ladies and gentlemen, is what we call a preview of coming attractions.

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2 Comments on “Volt Birth Watch 78: The First Of Many Tax Breaks...”


  • avatar
    AG

    Tens of millions to ‘save’ 300 jobs? Why don’t they just give those 300 people 30 thousand dollars cash. At least then they don’t have to worry about dealing with the company responsible for making Flint nationally known for all the wrong reasons.

  • avatar
    Dutchchris

    Flint is throwing it’s money in a bottomless pit. If GM’s claim is sincere that the Volt needs to have an MSRP of 40k in order to break even than the Volt is just the final nail in the coffin of the General (unless there are loads of people out there that don’t mind to spend a buck to save a dime on gas). Maybe fitting both an electric drive train and an ICE really does make the car expensive to build. If so they should take the same road as (all?) the other car manufacturers at this point and go for battery electric without the range extender. Just as electric scooters are cheaper to build than petrol scooters (in china over 10 million a year are sold because they are cheap to buy and cheap to run) so will BEV’s be (a lot) cheaper to build than ICE cars and their PHEV/HEV variants. But it seems the General is still very pleased with himself for crushing hordes of innocent EV1’s and therefore it seems he would rather die than have to admit that this battle was a failure and to resurrect the slain EV1 (or rather create an all electric Volt version without ICE and more batteries that they could call the EV2).

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