Sunday, March 4, 2012
Chevy Volt - Another Obama Crony Capitalism Fiasco!
On 28 February, President Obama told a United Auto Workers gathering that he'll buy a Chevrolet Volt after his presidency but his Secret Service prohibits him from driving now (strange, given President Bush drove while president but then again, Bush might have been a better driver). Obama said he “enjoyed sitting in a Volt” and plans to pick one up after his tenure is over "five years from now." Given how Volt sales are going, it’s doubtful it will even be around next year when he’s no longer president so he might want to buy one soon if he wants to make good on that promise. Even as “Obama friendly” GM is, even “Government Motors” can't afford to keep a clunker like the Volt in productions when it’s bleeding red ink like this one is!
Chevrolet announced on 2 March 2012 that it was temporarily halting production of the Volt and laying off 1300 workers at its Detroit Hamtramck plant because of poor consumer demand for the vehicle. GM has sold a piddly 1,626 Volts so far this year! Even with Obama’s more than $2 Billion “taxpayer donation” for electric car battery system design and a $7,500 tax credit for buying one of these clunkers, GM still can't sell this piece of junk!
There are three reasons why Volts don't sell: Price, Hassle and Safety (not to mention resale value - they lose most of their value driving off the dealer lot).
The Volt starts at about $41,000, or twice as much as the company’s high-mileage Cruze Eco compact sedan. Even if you never used gasoline in the Volt, you’d wait about 12 years before you saved enough on gas to make up for the Volt’s price difference.
The Cruze gets 40 miles to the gallon of gas reliably while the Volt’s battery performance varies with weather and driving conditions. Plugging in to charge can also be a chore most drivers choose to avoid.
Finally, battery fires broke out in three Volts after safety crash-testing last year thus creating a perception of a safety risk which has also hurt sales. GM and federal officials believe that the fires were caused by coolant leaking from damaged plastic casing around the batteries after side-impact test crashes.
Given all the strikes against it, the Volt is going to be the Edsel of the 2010 decade. With Obama’s “money is no object – as long as it’s Taxpayers’ money” attitude and his “Crony Capitalism” business philosophy, Taxpayer subsidies may keep it on life support until the next election to postpone another Solyndra but after the election when he’s no longer in office, I'm confident GM will let it die a quite death.