Tag: Tax Break

By on January 21, 2010

This week saw the Volt’s price point issues return to the public eye, as GM’s Chairman and CEO made it clear that he takes the government’s $7,500 tax credit for granted. But Whitacre’s dissembling revealed once again GM’s fundamental problem with the Volt: getting people past the sticker shock. Though GM’s short-term viability doesn’t hinge on the Volt selling like gangbusters, it’s clear that the Volt’s initial success or lack thereof will be a crucial factor in GM’s ability to hold a successful IPO and extricate itself from government ownership. Which, according to The Big Money‘s Matt DeBord, is one of the reasons the government should expand the Volt’s credit of $10k. Another reason: the Volt’s competition is too good!

with the base Prius selling for just over $20,000 and the base Honda Insight hybrid for under $20,000, the feds may have to start thinking about how to enable innovative electric and gas-electric plug-ins to survive. The EPA mandate to raise fleet fuel-economy standards to average of 35.5 mpg by 2016 looms, and a component of that target should be EVs and plug-ins. Otherwise, carmakers may abandon the tech, leaving it stillborn to cynically massage their fleet numbers by importing small cars from foreign operations to North America—cars they know Americans will only grudgingly purchase and that may force the government to chuck the 35.5 requirement.

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