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obeygiant

macrumors 601
Original poster
Jan 14, 2002
4,180
4,096
totally cool
The accolades for its Chevy Volt, those accolades don’t come cheap. The Chevy Volt reportedly cost a whooping $40,000 each to build, not including development costs.

That price makes the $41,000 MSRP seem downright reasonable. GM makes just $1,000 on each Volt sold. That isn’t a lot, considering that GM can make upwards of $15,000 on the sale of an upscale Suburban such as the Cadillac Escalade or GMC Denali. On the same token, GM also lost around $1,000 on every Chevy Cavaleir they sold, and they sold a lot of those. GM will make about $1,000 on every Volt sold. At that rate, it will take GM a long, long time to recoup the $1 billion some-odd dollars they spent developing the Volt.

These revelations come from Steve Rattner, who in his book “Overhaul” walks us through the auto bailouts that dominated last year. While I am surprised that GM, one of the world’s largest automakers, couldn’t build the Volt for cheaper, I guess it kind of justifies the Volt’s high cost. What say you though, in light of these revelations, is it really still worth the $41,000?
link

They better had sell a lot of these. :eek:
 

Rodimus Prime

macrumors G4
Oct 9, 2006
10,136
4
I read years ago that they never planned to come close to even breaking even on the Volt. Volt was just the first stage in long term R&D for the project. They knew that they need to head that way because the future is going to force them to as cost of fuel goes up.
 

MacNut

macrumors Core
Jan 4, 2002
22,995
9,973
CT
I bet they make some of that back with deals made with the power companies. These things need to be plugged in.
 

Tilpots

macrumors 601
Apr 19, 2006
4,195
71
Carolina Beach, NC
The Volt's just the tip of the iceberg. IF, and a big if, they perfect the manufacturing and design and port it to other vehicles, GM will start raking in the cash. The more they sell, the cheaper it gets. Not many are going to be willing to spend $41,000 for it, but nobody would buy it for $50k. If they want to get the electric car era jump started, they gotta give it away in the beginning.
 

quagmire

macrumors 604
Apr 19, 2004
6,910
2,338
Hopefully it'll fail hard and GM will be forced to design a proper EV and not just another hybrid.

:rolleyes:

It's exactly what it needs to be. The market is not ready for a full on electric vehicle. Range, charge time, infrastructure, cost, etc is not where they need to be.

The Volt offers people to never use gas, but it is there if they need it. It's just the next stepping stone to eventually getting off gasoline. The Volt can appeal to everyone once the price of the technology goes down. The Leaf on the other hand appeals to a more limited group of people right now because it can only go 100 miles on a charge with a long recharging time.
 

NT1440

macrumors G5
May 18, 2008
14,659
21,021
:rolleyes:

It's exactly what it needs to be. The market is not ready for a full on electric vehicle. Range, charge time, infrastructure, cost, etc is not where they need to be.

The Volt offers people to never use gas, but it is there if they need it. It's just the next stepping stone to eventually getting off gasoline. The Volt can appeal to everyone once the price of the technology goes down. The Leaf on the other hand appeals to a more limited group of people right now because it can only go 100 miles on a charge with a long recharging time.

I just wish they would be honest in their marketing for it. T
 

Rodimus Prime

macrumors G4
Oct 9, 2006
10,136
4
Hopefully it'll fail hard and GM will be forced to design a proper EV and not just another hybrid.

the problem is EV only cars have a very limited range and can not handle long distance traveling. On top of that it takes a long time to bring their charge back up.
Plug in hybrid like the Volt solve that problem by providing another fuel source for longer traveling and for times when it can not be charged. The batteries in the volt are 40 mile range. Well with in most people's daily distance. It would of been nice to see it up to 60-70 miles and I hope in the future they kick it to 100 miles range but we still need a hybrid power source.

Batteries are good for short range and we need another source for longer range. The Volt's design makes it every easy to switch over to another back up generator since that is all the gas engine does.
 

obeygiant

macrumors 601
Original poster
Jan 14, 2002
4,180
4,096
totally cool
:rolleyes:

It's exactly what it needs to be. The market is not ready for a full on electric vehicle. Range, charge time, infrastructure, cost, etc is not where they need to be.

The Volt offers people to never use gas, but it is there if they need it. It's just the next stepping stone to eventually getting off gasoline. The Volt can appeal to everyone once the price of the technology goes down. The Leaf on the other hand appeals to a more limited group of people right now because it can only go 100 miles on a charge with a long recharging time.

The Volt I actually like and would get it. But the Leaf looks like an English taxi cab.
 

DiamondGCoupe

macrumors 6502
Nov 12, 2007
379
24
Doubtful those numbers are accurate, willing to bet it's more a marketing stunt at this point considering they could price it much higher and sell all this years units without a problem.. With potential profits like this, it's only a matter of time before GM heads down the wrong road, again. Makes no sense really.
 

obeygiant

macrumors 601
Original poster
Jan 14, 2002
4,180
4,096
totally cool
Doubtful those numbers are accurate, willing to bet it's more a marketing stunt at this point considering they could price it much higher and sell all this years units without a problem.. With potential profits like this, it's only a matter of time before GM heads down the wrong road, again. Makes no sense really.

Rattner is currently the subject of legal proceedings and despite the questionable ethics and behavior of doing so he wrote the following: “At least in the early years, each Volt would cost around $40,000 to manufacture (development costs not included).”
Rattner admitted in an interview with the New York Times that he “didn’t know the precise number,” but agreed that despite the costs, on developing the Volt GM was “right to do it,” to silence critics “who’ve said for many years that the company was behind the curve.”
GM spokesperson Rob Peterson would of course not confirm these values, though GM has a history of getting small or no margins on small cars. Even the famous high volume Chevrolet Cavalier was known to be sold at loss. “We haven’t released any numbers related to costs,” said Peterson. ”The importance of the Volt is more than a single profit-and-loss statement.” Indeed.
Rattner agrees the introduction of EVs are important, but doubts any automaker is in a position to profit on them in the early years. “E.V.’s are everybody’s latest fantasy,” he said. “No doubt they are important and they are real, but they won’t have an impact on profitability and sales for the foreseeable future.”
Rattner also thinks the idea of start-ups like Tesla rising up and competing successfully with major automakers is a bit far-fetched. “E.V. markets will be dominated by the existing companies,” he said. “They have the scaled operations and the dealer networks. The idea that a bunch of E.V. companies will come along and G.M. and Ford will go out of business is kind of crazy.”
gm-colt.com

My old girl friend had one of those cavaliers. :)
 

NT1440

macrumors G5
May 18, 2008
14,659
21,021
This isn't really all that shocking to be honest. The costs of new tech are always higher at first, but when a big player finally pushes it, the prices drop dramatically.
 

localoid

macrumors 68020
Feb 20, 2007
2,447
1,739
America's Third World
Borrowing from Peter to pay Paul

Currently, 45% of the electrical power generated in the U.S. is produced by burning coal. Even if cars like the Volt are successful, increased demand for more electric power would likely result in more greenhouse gases being emitted.
 

Tilpots

macrumors 601
Apr 19, 2006
4,195
71
Carolina Beach, NC
Currently, 45% of the electrical power generated in the U.S. is produced by burning coal. Even if cars like the Volt are successful, increased demand for more electric power would likely result in more greenhouse gases being emitted.

Sure, but you have to make the switch to electric at some point. Better now than later. Plus, the Federal Government and even some States are starting to mandate higher alternative energy production. This isn't the solution, but it's a step forward.
 

macquariumguy

macrumors 6502a
Jan 7, 2002
857
361
Sarasota FL
:rolleyes:

It's exactly what it needs to be. The market is not ready for a full on electric vehicle. Range, charge time, infrastructure, cost, etc is not where they need to be.

I agree the market isn't ready for a battery-only EV, but I disagree that the Volt is "what it needs to be". It's still a dual drivetrain vehicle, and I think that's the wrong approach.

Much better would be a small diesel engine to power a generator. Look at locomotives for the right way to do an extended range EV.
 

quagmire

macrumors 604
Apr 19, 2004
6,910
2,338
I just wish they would be honest in their marketing for it. T

I don't know how they were not being dishonest about it. Their term for it as an, " Extended Range Electric Vehicle" is technically correct. It is a plug in hybrid by the strictest of terms, but any company will find a marketing term that makes their product look better.

Doubtful those numbers are accurate, willing to bet it's more a marketing stunt at this point considering they could price it much higher and sell all this years units without a problem.. With potential profits like this, it's only a matter of time before GM heads down the wrong road, again. Makes no sense really.

Why do you doubt those numbers? It was only a few years ago( or is it still the case?) that the battery in the Prius cost $8,000 to replace. What do you think the much bigger battery in the Volt costs? Even Nissan is most likely taking a loss on the Leaf.

Currently, 45% of the electrical power generated in the U.S. is produced by burning coal. Even if cars like the Volt are successful, increased demand for more electric power would likely result in more greenhouse gases being emitted.

Electrical plants are more efficient at burning their fossil fuels then our cars are. Plus with our current state of our infrastructure, charging will most likely take place back home off peak hours.


I agree the market isn't ready for a battery-only EV, but I disagree that the Volt is "what it needs to be". It's still a dual drivetrain vehicle, and I think that's the wrong approach.

Much better would be a small diesel engine to power a generator. Look at locomotives for the right way to do an extended range EV.

That is the Volt's approach with replace the diesel with the gas engine. The electric motors are the only thing that power the wheels. There is no mechanical linkage from the gas engine to the wheels. I know there was an outrage over this confusion back in October, but that is not the truth.

http://www.chevroletvoltage.com/index.php/Volt/clearing-up-confusion-about-the-chevrolet-volt.html
 
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Mousse

macrumors 68040
Apr 7, 2008
3,495
6,717
Flea Bottom, King's Landing
Currently, 45% of the electrical power generated in the U.S. is produced by burning coal.

Maybe. But where I'm from, most of our electricity comes from a couple nuclear plants. There's probably a Burnsian CEO arching his fingers and saying, "Excellent" at the prospect of the Volt being a big success. I'd love get one if I could afford the $40K price tag.
 

dmr727

macrumors G4
Dec 29, 2007
10,420
5,160
NYC
Currently, 45% of the electrical power generated in the U.S. is produced by burning coal.

Perhaps, but do you think it'll stay this way? Electricity can be generated cleanly. I don't see why we need to put a stopper on progress elsewhere just because we have more work to do in how we generate electricity.
 

jeffy.dee-lux

macrumors 6502a
Nov 19, 2003
721
0
montreal
That is the Volt's approach with replace the diesel with the gas engine. The electric motors are the only thing that power the wheels. There is no mechanical linkage from the gas engine to the wheels. I know there was an outrage over this confusion back in October, but that is not the truth.

http://www.chevroletvoltage.com/index.php/Volt/clearing-up-confusion-about-the-chevrolet-volt.html

I agree with all your other points, but you're mistaken on the Volt's powertrain. Here's a link that's posted on the page you linked to:
http://www.motortrend.com/features/...the_chevy_volt_to_see_how_it_ticks/index.html

MotorTrend spells it out very clearly. Some people are saying there's no "direct" mechanical linkage from engine to wheels, but they're only saying that because there's a planetary gear coupling, that's still a mechanical coupling in my books. MT explains the differences between this and the Toyota's power-split device, and it is significantly different (especially considering it doesn't even come into play for the first 40 miles, and even then only at high speeds), but no this is not a pure series hybrid as you suggest.

It doesn't take anything away from this car, most of the time it is a series hybrid, in fact all they've done is attack the one weakest aspect of a series hybrid, and that is needless extra energy conversions when you're just cruising on the highway (where the engine would be operating at a constant speed anyways). Clearly GM put a lot of thought into the series hybrid architecture, if you think they weren't aware of Diesel locomotives, that's crazy. But after lots of analysis, they decided this innovative and complex transmission was worth it for the gains in charge-sustaining mode MPG. I've built a number of series hybrid and electric vehicles myself and I'm a big fan of the series hybrid idea, so I was taken aback at first, but I don't doubt their decision at all.

--

At a conference last year, I asked Mark Perry from Nissan why they're selling the Leaf at a loss and he said Nissan's idea is that the first to the market will reap the benefits down the road.
 

jeffy.dee-lux

macrumors 6502a
Nov 19, 2003
721
0
montreal
Perhaps, but do you think it'll stay this way? Electricity can be generated cleanly. I don't see why we need to put a stopper on progress elsewhere just because we have more work to do in how we generate electricity.


I've done a lot of research on actually comparing the emissions based on the current grid mix with most results showing you still come out ahead with EVs, even on the US mix, but I think this is my favourite argument. Imagine a car company designing a new car and saying "wait! we can't start working on the seat belt design yet, we haven't finished the headlights! there's no point in having seatbelts if there are no headlights!"
 

Huntn

macrumors Core
May 5, 2008
23,484
26,601
The Misty Mountains
$40k seems on the high side as a car for the masses. And would there be any reason for that price to come down? The trend in cars/trucks has been steadily up for as long as I can remember.
 

localoid

macrumors 68020
Feb 20, 2007
2,447
1,739
America's Third World
Perhaps, but do you think it'll stay this way? Electricity can be generated cleanly. I don't see why we need to put a stopper on progress elsewhere just because we have more work to do in how we generate electricity.

Despite "high hopes" for going green, the current reality of this is that about 45% of a U.S. Volt owners will be using a coal-powered car.

Do you folks actually believe that U.S. "coal barons" are willing to roll over and die? Anyone who believe that is naive. The coal industry is willing to spend millions or perhaps billions to defeat any bill that they see as being "anti-coal", which includes not only cap and trade but any environmental related bill that tightens regulations on mining or burning coal.

It's really very simple -- if the country's coal barons have their way, the use coal-generated power will increase, not decrease, in coming years. In most coal-producing states, it's extremely easy to whip-up support for coal -- they simply raise the "they want to take your jobs" issue.

Unfortunately, I live in the heart of Appalachia, where there are currently more signs and bumper stickers of the "Friends of Coal" kind than there are of the "Honk if you love Jesus" variety. This pro-coal group produces pro-coal literature currently being used in the local K12 school system that "teaches" kids that coal is clean and cheap, and is an abundant energy source that shouldn't be abandoned.

Here in Appalachia, few newspapers or other media have the balls to take an "anti-coal" position and coal companies openly send thugs to disrupt environmental gatherings without fear of interference from law enforcement.

Wake up people... watch the Clean Coal for Christmas video.
 
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Lord Blackadder

macrumors P6
May 7, 2004
15,669
5,499
Sod off
The most noteworthy point in the OP is the fact that GM makes big profits on SUVs, loses money on economy cars and breaks even on the Volt (if they are lucky).

No wonder the Big Three have been flooding the market withg Escalades, Yukons, Trailblazers, Explorers, Expeditions etc etc etc for years. They are cheap trucks with a big fat markup.
 

jeffy.dee-lux

macrumors 6502a
Nov 19, 2003
721
0
montreal
The most noteworthy point in the OP is the fact that GM makes big profits on SUVs, loses money on economy cars and breaks even on the Volt (if they are lucky).

No wonder the Big Three have been flooding the market withg Escalades, Yukons, Trailblazers, Explorers, Expeditions etc etc etc for years. They are cheap trucks with a big fat markup.

Not to mention anything of the Sequoia, FJ Cruiser, 4Runner, Land Cruiser, Armada, Pathfinder, GX460, LX570, QX56. Why do the Asian companies always get a free pass on their giant offerings? They want in on that party just as much as any of the Big Three. In fact, I'd say Toyota is trying way harder than any of the big three brands, with 6 distinct SUV offerings (rav4, fj, highlander, 4runner, sequoia, land cruiser).
 
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