By on December 8, 2008

Speaking of wedge issues. In a bizzare inversion of those tabloid baby-bump rumors, there’s a hot tip flying around the autoblogosphere that GM is aborting the Volt program and firing engineers. Things started with an anonymous tip to Jalopnik, saying “My uncle works on the Volt as an engineer. He’s getting laid off Friday because apparantly the project (aka VOLT) is on hold indefinitely.” Early responses from PR flacks was inconclusive, but Autoblog has apparently received word from GM spokesman Terry Rhadigan that “there’s no truth in that statement whatsoever.” Rhadigan went on to hedge a bit, saying “I’m not going to respond to specific speculation. The Volt remains a top priority for our Company and there are no changes to the timing of the program.” With a bailout compromise announcement expected at any time, this little rumor could mean one of two things. Either it’s true, and GM is cutting everything it can to make its “survive to March 31” bill as palatable as possible, or it’s untrue and GM is spreading a lie/allowing it to fester to scare more money out of the pols. Either way, file this under “unpleasant.”

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26 Comments on “Volt Birth Watch 119: Aborted. Or Not....”


  • avatar
    Zarba

    I may be going out on a limb here, but not even Wagoner is THAT stupid.

    If true, the bailout is toast.

  • avatar
    no_slushbox

    Sorry engineers, but on the path of working hard through high school and very difficult college programs (possibly serving in the military to pay for college) in an attempt to increase America’s human capital and contribute valuable skills to the country you failed to form a thuggish, politically connected union or lobby for protective state laws.

    This is the problem with government life support for the automakers instead of Chapter 11s. Right now GM is forced to overpay pay unskilled line workers (protected by the UAW) and support 8 brands and 4000 too many dealers (protected by state franchise law) first.

    Future product development with disposable engineers comes second, and will have no funding left for it.

    With no future products there will be no industry to save. When it becomes clear that the bailout is just welfare for overpaid UAW workers and car dealers (who the public love) it will be interesting to see how this unravels.

  • avatar
    NickR

    If this is true, then there are many heads at GM that should roll, starting at the very top. And hopefully those rolling heads will bowl the legs out from underneath a few congressmen and women.

  • avatar
    thalter

    I call bullshit. True, the Volt will never make a dime, but it is key to the PR campaign to secure bailout/CH11 financing.

  • avatar

    I would assume that word of killing the Volt would be immediately followed by a stop-payment on the bailout check. With all the crybabying the government is doing about the fuel efficiency issue, it should be the one R&D program allowed to run in the red.

  • avatar
    peteinsonj

    umm, lets also be clear, there are lots of types of engineers… I’d worry if one specilizing in “battery technology” were no longer on the team, and not so much with a structural engineer, since that part of the project is probably done.

    and I would be willing to bet that telling your family you worked on the Volt project at GM is a feather in the cap kind of thing, or maybe something you might say if didn’t want you family to worry about you being laid off… (even if it wasn’t exactly so)

  • avatar
    Landcrusher

    The oil industry learned their lesson with this, and have been doing something about it. If you only hire in good times, and always lay off in bad, then eventually talented workers don’t bother to get trained in your specialty.

  • avatar
    geeber

    Didn’t this very same rumor – down to the tip-off from the anonymous reader with the uncle working on the Volt program – circulate a few weeks ago…?

  • avatar
    KatiePuckrik

    As much as I hate to say it, logically, this move (if it is true) does make a lot of sense.

    The car is slated for sale at around $30K which is $10K more than the 3rd generation Prius will be. Even at $30K it is unlikely GM will turn a profit. Which means they will be in the same position as the Saturn Astra (the more they sell, the more they lose). Right now they are trying to convince the government that they have a plan to make money. What better way to show this than to cut models which won’t make money?

    Given that petrol prices are under $2 for the time being, this will give GM enough time to shore up a fleet of cheap small cars to restore what little green credibility they have. With GM-Daewoo and their relationship with Suzuki, they should be able to have some good small cars on the market in good time. Volkswagen don’t have a hybrid in their line up, but they still retain a “green” halo with their Bluemotion technology (despite what I or other people think of it).

    We keep moaning that GM won’t make tough decisions to save their business. Now it looks like they’re making one (one which makes sense), people say it’s a bad move.

    If the Chevrolet Volt was a project with huge potential, then, this would be a dumb move. But it isn’t. We’ve derided this project, on TTAC, from day one, saying it won’t amount to much. So, what’s the problem if they cut it….?

  • avatar
    NickR

    So, what’s the problem if they cut it….?

    No problem with cancelling it in the strictest senese of the word. My fury comes from the fact that it was all a goddamed ruse in the first place.

  • avatar
    Zarba

    katie:

    The $30K went by the wayside long ago. They’re now saying “around $40K”, and hoping for a tax break of at least $7,500 to make it even a little competitive.

    If they sell 10,000 of them, that’s a $75 Million bailout right there.

    No, they HAVE to keep the project moving forward. Even if they lose money on them; because it’s the ticket to the bailout billions.

  • avatar
    RedStapler

    Slushbox:

    The engineer with specialized automotive knowledge can go to work for Toyota, Honda, Cat, Deere, International, Paccar, Volvo etc.

    The 45yr old high school dropout UAW clock milker is up a certain creek sans paddle.

    The “protected” dead brand walking dealer can be starved out. GM can just pull an Isuzu and offer the zombie brands one stale unappealing model. Many are dying on their own between the costof/lack of access to capital and cutthroat ruinous competition. In any big Metro area there are 30-50+ stores selling the same product.

  • avatar
    toxicroach

    Cutting the Volt is short sighted. For now it may be an impractical money loser, but eventually the market is going to move to EVs, and if GM kills the Volt and sits on its thumbs it’ll lose again. They need to work on the Volt, maybe tone it down a bit to get costs down, and keep plugging away until they get a viable product.

  • avatar
    autonut

    If this car will go through management review even on senate/congressional level it can not possibly pass the mustard. Perhaps I have high aspiration for our elected officials, but most of them lawyers and can understand simple math. The car will cost 40K minus tax incentives.It will cost billions to develop and it will not be tested before production. The risk factor is tremendous. The heart of the car – batteries are not developed in GM but outsourced completely (risk goes only higher). If there are enough celebrities and eco-nazis to shed 40K for this turkey which may or may not drive(it is a research platform today), what will happen following production year, when horror stories about quality will rise its ugly head? This bastard is still born.

  • avatar
    snabster

    Not surprised. Volt only existed to justify $25 billion in DoE loan program. As a return on investment it was superb ($250 million in exchange for 15 billion). Now that GM is getting the money w/o having to build fuel efficient cars, there is no need for the Volt.

  • avatar

    I’ve kind of been certain that the car’s been misnamed from the start, and now it appears it’s set to become the Bolt … What a surprise.

    That car was never intended for the real world. It was a concept mash-up that garnered so much attention that GM found itself having to push on – when they really didn’t have any feasible spec’s to build from.
    And that’s where they’re stuck now – caught in the performance trap, just like Tesla.

  • avatar
    GeeDashOff

    When the Volt is released every single one will come with its own copy of Duke Nukem Forever.

    No really, the Volt is the definition of vaporware.

  • avatar
    Bubba Gump

    The Volt marches on full tilt! It will be the last program cancelled. It is the number 1 top prority program ahead of every other. It is now the Heart. GM will cut off every limb and their head before that program gets cancelled.
    A GM engineering Employee

  • avatar
    guyincognito

    While I completely agree with Katie that this would represent a smart business decision, I have to call shenanigans. This would be such a catastrophic PR blunder, GM might actually have to lay off a top exec to pay for it after Nancy Pelosi’s head started swiveling 360 degrees about her neck whilst spewing green vomit. I mean, Wagoner drove the Volt mule to the freaking bailout hearings!! Although, if it is their goal to blackmail more money with the Volt, well I guess that it would probably work.

  • avatar
    psarhjinian

    If they kill it, what will Rick drive to Washington in 2009?

  • avatar

    # psarhjinian :
    December 8th, 2008 at 4:43 pm

    If they kill it, what will Rick drive to Washington in 2009?

    The GM Dolt.

    Bubba Gump seems to have the inside dope, though, it appears it’s still being worked on.

  • avatar

    If this is true, GM will be in the same waterfall-approaching boat as Chrysler. No new products in the pipeline = not worth saving.

    At least Ford has UK to pick pre-developed vehicles from.

  • avatar
    Usta Bee

    They’d be smart to put the Volt on the backburner right now and spend the money developing more fuel efficient smaller and mid-sized cars. The Volt was never more than a PR stunt for a very small niche market, like the EV1. If they are serious about hybrid technology they’d be better off putting the money into a Prius and Insight competitor that takes lithium batteries. The Volt is just too expensive for what it has to offer, especially now that gas is cheap again. The way the credit market is nobody will be willing or able to shell out $40k for a hybrid like that.

  • avatar
    M1EK

    The amazing thing is that 3-6 months ago, people who predicted that GM would be out of money before they could build the Volt were shouted down by the other 99% of the crowd at gm-volt.com. (Yes, I was one of the bankruptcy-predictors, but not the only one). Now, it’s seen as imperative there that we must rescue GM or the Volt will never get built.

    We have always been at war with Oceania.

  • avatar
    windswords

    Hmmmm… this reminds me of the rumor that sprang up that Chrysler’s Phoenix engine project was cancelled/suspended. That was not true. Test mules are on the road now. Kinda like the “Chrysler has no products in the pipeline” nonsense. I guess those spyshots of the HD Ram and the electric vehicle (different from the 3 shown in the dog and pony show earlier) are just photoshops.

    There is all kind of FUD on the interwebs now. Take E V E R Y T H I N G with a grain of salt. Hell with that, use the whole damn shaker.

  • avatar
    Redbarchetta

    I think this is BS, it’s too soon for them to have to cancel or slow down the Volt before others get canned. It would be too smart of them the slow down the time line for the Volt so they could put more time and money into “GM saving” products that will sell at a decent profit and in volume to generate the cash the company needs(Cruze, Aveo, Astra Impala, etc.), not some small plug-in that is little or no profit at very low numbers but cost a boatload of money they don’t have to develop. GM doesn’t usually do the smart thing.

    They will start messing with the Camaro right before the Volt starts to get it’s budget cut. The bailout money was always riding on this “game changer” for so long they have to make it look like it’s really coming for as long as possible even if the money has really dried up.

    Don’t get me wrong I’m one of those people who never though and still don’t think the Volt will ever see a showroom but I think it will be almost a month before they slowly start pulling the plug on the Volt. Even with the bailout billions it’s not going to be enough money to toss in the furnace of monthly burn and keep the Volt in development AND the other cars & trucks under development AND marketing for new launches AND investments into new markets AND restructuring costs…

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