California Denies Volt AT-PZEV Status, Tax Rebate, HOV Access

With Chevy’s Volt priced at an eye-popping $41k before tax breaks, those tax breaks are now more important than ever. The first 200k Volts will qualify for up to $7,500 in federal credits, but Chevrolet had to be hoping for state incentives on top of the federal credit, especially in the key launch state of California. For a number of reasons though, the Volt doesn’t meet California’s requirements for Advanced Technology-Partial Zero Emissions Vehicles, and will lose out on a $5,000 tax credit that’s available to its cheaper competitor, the Nissan Leaf. As a result, the Leaf will cost Californians who qualify for both full credits about $20k, while the Volt will cost about $33,500. Moreover, the Leaf will have full access to California’s High Occupancy Vehicle lanes while the Volt will not, unless a pending bill before California’s state Senate passes. Together, these developments represent a serious advantage for the Leaf over the Volt in what is almost certain to be the world’s largest market for electric cars in the short-to-medium term. So how did GM let this happen?

Greencarreports‘ John Voelcker says California’s evaporative emissions standards may well have scuttled any attempt at certifying the Volt as an AT-PZEV, and regardless of the actual reason, it’s clear that the Volt’s hybrid drivetrain was a factor. The Volt’s range-extended electric drivetrain concept, which delivers very different results based on driving and charging patterns, is still confusing the EPA’s efficiency testers, and it seems the gas-electric compromise was never going to meet California’s strict standards. According to EVWorld

GM decided in 2007 when it committed to series production of the Volt, to not seek California Air Resources Board AT-PZEV certification. Instead, the decision was made to certify the car in all 50 United States. ARB certification would have required, both GM executives explained, additional testing and since California’s air quality regulators had yet to figure out how to classify the Volt, GM felt it was more important to continue the accelerated development program and get the car out by the Fall of 2010 then wait for ARB to come up with a way to categorize what will be for many drivers essentially an all-electric car, while for other who driver further distances each day, a hybrid.

In other words, because GM rushed the Volt to market, it put its wundercar at a devastating competitive disadvantage in its most crucial market. Luckily for the Volt, California’s fiscal crisis has already largely solved the problem. Facing a budget shortfall in the tens of billions of dollars, California has only funded its plug-in tax rebate by $4m, meaning that if Leaf drivers use all the available funding, only 820 cars would have been subsidized this year. Next year, California is expected to renew the program for only $8m, meaning only about 1,600 plug-in purchases will be covered. GM reckons that, with so little money at stake, it doesn’t need to bother certifying to the California standard until 2012. With more than a few eyeballs still bulging at the Volt’s $41k pricetag, however, GM could probably have used all the help it could possibly get.