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GM loses $49,000/Volt

jimbo

jimbo

Bronze Member
The number does not include the cost of the bail out or the $7,500/vehicle subsidy, or the grants to get smaller government entities to purchase. Of the effects of non bid purchases by the federal government, or the cost of charging stations.

General Motors Co. sold a record number of Chevrolet Volt sedans in August -- but that probably isn't a good thing for the automaker's bottom line.

Nearly two years after the introduction of the path-breaking plug-in hybrid, GM is still losing as much as $49,000 on each Volt it builds, according to estimates provided to Reuters by industry analysts and manufacturing experts.

Cheap Volt lease offers meant to drive more customers to Chevy showrooms this summer may have pushed that loss even higher. There are some Americans paying just $5,050 to drive around for two years in a vehicle that cost as much as $89,000 to produce.

And while the loss per vehicle will shrink as more are built and sold, GM is still years away from making money on the Volt, which will soon face new competitors from Ford, Honda and others.

GM's basic problem is that "the Volt is over-engineered and over-priced," said Dennis Virag, president of the Michigan-based Automotive Consulting Group.

And in a sign that there may be a wider market problem, Nissan, Honda and Mitsubishi have been struggling to sell their electric and hybrid vehicles, though Toyota's Prius range has been in increasing demand.

GM's quandary is how to increase sales volume so that it can spread its estimated $1.2-billion investment in the Volt over more vehicles while reducing manufacturing and component costs -- which will be difficult to bring down until sales increase.

But the Volt's steep $39,995 base price and its complex technology - the car uses expensive lithium-polymer batteries, sophisticated electronics and an electric motor combined with a gasoline engine - have kept many prospective buyers away from Chevy showrooms.

Some are put off by the technical challenges of ownership, mainly related to charging the battery. Plug-in hybrids such as the Volt still take hours to fully charge the batteries - a process that can been speeded up a bit with the installation of a $2,000 commercial-grade charger in the garage.

PLANT SHUTDOWN

The lack of interest in the car has prevented GM from coming close to its early, optimistic sales projections. Discounted leases as low as $199 a month helped propel Volt sales in August to 2,831, pushing year-to-date sales to 13,500, well below the 40,000 cars that GM originally had hoped to sell in 2012.

Out in the trenches, even the cheap leases haven't always been effective.

A Chevrolet dealership that is part of an auto dealer group in Toms River, New Jersey, has sold only one Volt in the last year, said its president Adam Kraushaar. The dealership sells 90 to 100 Chevrolets a month.

The weak sales are forcing GM to idle the Detroit-Hamtramck assembly plant that makes the Chevrolet Volt for four weeks from September 17, according to plant suppliers and union sources. It is the second time GM has had to call a Volt production halt this year.

GM acknowledges the Volt continues to lose money, and suggests it might not reach break even until the next-generation model is launched in about three years.

"It's true, we're not making money yet" on the Volt, said Doug Parks, GM's vice president of global product programs and the former Volt development chief, in an interview. The car "eventually will make money. As the volume comes up and we get into the Gen 2 car, we're going to turn (the losses) around," Parks said.

"I don't see how General Motors will ever get its money back on that vehicle," countered Sandy Munro, president of Michigan-based Munro & Associates, which performs detailed tear-down analyses of vehicles and components for global manufacturers and the U.S. government.

It currently costs GM "at least" $75,000 to build the Volt, including development costs, Munro said. That's nearly twice the base price of the Volt before a $7,500 federal tax credit provided as part of President Barack Obama's green energy policy.

Other estimates range from $76,000 to $88,000, according to four industry consultants contacted by Reuters. The consultants' companies all have performed work for GM and are familiar with the Volt's development and production. They requested anonymity because of the sensitive nature of their auto industry ties. 1/8 Factbox on estimates -- nL2E8K7HPC 3/8



http://www.chicagotribune.com/busin...olt-20120910,0,5279427.story?page=1&track=rss
 
The Volt is not as energy efficient as a Prius, nor as flexable in use, nor as desirable to drive.

It is a 1980's design concept car literaly forced into production.

Most Auto mags won't even waste print and paper to Derogate or put it down anymore.

Right now one can sign a two year lease on the car for $199.00 a month. Then get the $7,500 tax credit, netting $2,500. But it cost so much to operate the car, few are taking the bait, even at that price.

Proving that, in the real marketplace, you cannot pick up a turd from the clean end.
 
FrancSevin said:
The Volt is not as energy efficient as a Prius, nor as flexable in use, nor as desirable to drive.

It is a 1980's design concept car literaly forced into production.

Most Auto mags won't even waste print and paper to Derogate or put it down anymore.

Right now one can sign a two year lease on the car for $199.00 a month. Then get the $7,500 tax credit, netting $2,500. But it cost so much to operate the car, few are taking the bait, even at that price.

Proving that, in the real marketplace, you cannot pick up a turd from the clean end.
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So, a government without any money bails out the least efficient manufacturer in an industry, funds the research for a vehicle that nobody wants, even for free, and subsidizes it with massive rebates.

What can possibly go wrong with that?
 
USSR tried it
Yugoslavia tried it

Their autos were crap.

Suggesting that looking at a new car , then truning to the government and saying "you didn't build that ?" is a good process.
"If so,, then I might buy it." would be a good answer.

There are things the government does fairly well.

Panama Canal
Space program
Military

even roads and bridges
But consumer products?,,,,,,Not so much.
 
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FrancSevin said:
USSR tried it
Yugoslavia tried it

Their autos wer crap.

Suggesting that looking at a new car , then truning to the government and saying "you didn't build that ?" is a good process.
"If so,, then I might buy it." would be a good answer.

There are things the government does fairly well.

Panama Canal
Space program
Military

even roads and bridges
But consumer products?,,,,,,Not so much.
Click to expand...
The Panama Canal, if built today, would be built in a swing state where the candidate needed votes, the space program has been outsourced to the Russkies, and the present military has been ordered to not shoot at people.

Maybe roads and bridges.
 
jimbo said:
The Panama Canal, if built today, would be built in a swing state where the candidate needed votes, the space program has been outsourced to the Russkies, and the present military has been ordered to not shoot at people.

Maybe roads and bridges.
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:yum::yum::yum:

Yeah if done today.

however,

The Panama canal was a project of the Corps Of Engineers and likely the most successful, underbudget, ahead of schedule, project in it's history.
(we could not build the canal today. Geopolitics and environmental issues)

We did successfuly place a man on the moon, the original goal of the Kennedy administration who wasn't too hampered by political correctness freaks and tree huggers.
(we could not do it today. there are virtualy no green products or green jobs involved in a moon shot)

And hands down, we do have the best trained and best equiped military in the world. For the moment anyways.

(Sequestor starts January ist 2013. Who knows after that.)

BTW, Barry completely ignored his obligation to have sequestor budgets outlined by September 6, 2012. Is that on the NYT front page above the fold?
Anywhere in that rag?
Military loses $1.2 trillion infunding.
But the GM Volt union guys will be covered.
 
jimbo said:
So, a government without any money bails out the least efficient manufacturer in an industry, funds the research for a vehicle that nobody wants, even for free, and subsidizes it with massive rebates.

What can possibly go wrong with that?
Click to expand...
100% Jimbo.

I drove GM products for many, many years. But I abandoned their products when their customer support and vehicle quality slid to an unacceptable level. It didn’t improve and for the next 20 years I boycotting their junk. I didn’t actively boycott them from the standpoint of a pissed of x-customer, but I didn’t buy anything from them either. And there were lots more consumers just like me that said NO, we don’t want to buy your junk any longer.

So the natural evolution of free enterprise played out and GM went bankrupt. Had the process been allowed to evolve further, GM would have been gobbled up by a profitable competitor, the union contracts that were contributors to GM’s woes would have been voided, and a profitable new company would have risen. People would have been hired and the natural progression of business would have played out.

But not so… along comes the government and they give GM all the money that I had intentionally not given to GM over the last 20 years. The company was allowed to live a couple of more years, but it will never be a healthy company. It can’t be. The problems that made it a failure are still in place, just masked over because of massive injections of our cash.

But most politicians don’t understand free enterprise. And further, they don’t realize bailing out a failing company so they can continue making products that nobody wants, is really no more than a stay of execution.

But I regress…




Screw the volt. :wink:
 
squerly said:
100% Jimbo.

I drove GM products for many, many years. But I abandoned their products when their customer support and vehicle quality slid to an unacceptable level. It didn’t improve and for the next 20 years I boycotting their junk. I didn’t actively boycott them from the standpoint of a pissed of x-customer, but I didn’t buy anything from them either. And there were lots more consumers just like me that said NO, we don’t want to buy your junk any longer.

So the natural evolution of free enterprise played out and GM went bankrupt. Had the process been allowed to evolve further, GM would have been gobbled up by a profitable competitor, the union contracts that were contributors to GM’s woes would have been voided, and a profitable new company would have risen. People would have been hired and the natural progression of business would have played out.

But not so… along comes the government and they give GM all the money that I had intentionally not given to GM over the last 20 years. The company was allowed to live a couple of more years, but it will never be a healthy company. It can’t be. The problems that made it a failure are still in place, just masked over because of massive injections of our cash.

But most politicians don’t understand free enterprise. And further, they don’t realize bailing out a failing company so they can continue making products that nobody wants, is really no more than a stay of execution.

But I regress…




Screw the volt. :wink:
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You scored it exactly right sir.

Kudos.

Imagine the quality of a Honda supported Chevy Impala

Or a Mitsubishi Dodge Caravan.
 
Local dealer 18 miles away has 2 of them highlighted in a big ad in our local paper. Must be they were forced to have them on their lot. They sure as hell ain't practical for most folk up here unless you carry your own generator along.:whistling:
 
http://news.consumerreports.org/cars/2011/10/consumer-reports-recommends-chevrolet-volt.html

Consumer Reports now recommends the Volt plug-in hybrid after new data from our 2011 Annual Auto Survey shows it earned much better than average reliability.

Very few of the 116 Volt respondents had any serious problems in the first few months of ownership. To be recommended a vehicle must do well in our testing, have average or better reliability, and perform adequately in independent safety tests (if included).

In our testing we found the Volt, which uses an electric motor and a gas engine, delivers quick, quiet acceleration, very low running costs in electric mode, and the equivalent of 99 mpg overall. But it has limited visibility and seats only four people.

Look for our full report on the new reliability Ratings next month and in our December issue.



And:

DETROIT – Reuters’ estimate of the current loss per unit for each Volt sold is grossly wrong, in part because the reporters allocated product development costs across the number of Volts sold instead of allocating across the lifetime volume of the program, which is how business operates. The Reuters’ numbers become more wrong with each Volt sold.

In addition, our core research into battery cells, battery packs, controls, electric motors, regenerative braking and other technologies has applications across multiple current and future products, which will help spread costs over a much higher volume, thereby reducing manufacturing and purchasing costs. This will eventually lead to profitability for the Volt and future electrified vehicles.

Every investment in technology that GM makes is designed to have a payoff for our customers, to meet future regulatory requirements and add to the bottom line. The Volt is no different, even if it takes longer to become profitable.

GM is at the forefront of the electrification of the automobile because we are developing innovative technologies and building an enthusiastic – and growing – customer base for vehicles like the Volt.


http://media.gm.com/media/us/en/gm/news.detail.html/content/Pages/news/us/en/2012/Sep/0910_volt.html
 
mak, I don't believe GM would have put this car into production without all of our money going into the pot. The amount they
are losing per unit and the amount of time estimated for it to break even, much less become profitable, would have doomed
it. They might have kept it alive as a concept care until the price of the technology dropped, but it would not be on the streets
now.

Subsidizing a commercial product, to the exclusion of others competing in the marketplace, is totally different from the
money allocated to pure research. And that is why I'm against this car; this makes us no better than the foreign governments
that subsidize their cars ... you know, the ones we bitterly complain about. Bad double standard here.

 
Sorry Mak2 but that article is over a year old. And it is about a car with lkes than one year of consumer service life.

It get 99 miles per gallon only if it has a full charge which take several hours and uses power generated elsewhere not calculated. It terms of real energy consumption, it gets the equivalent of 33 MPG. Several all gasoline cars beat that .

The Volts biggest drawback is the daily chores involved in maintaining full capacity use in the batteries.

It cannot and will not compete with the Prius.
Were it not for the Heavy rebates it would not sell at all.

And finally,
Given a 7 year model cycle (instead of a normal 6 year) across the current sales level, the development cost s will still be above acceptable business models.

The car is a loser even Madison avenue cannot convince people to buy.

If GM decides to go to version II of the Volt,, It will have to outsource all production of the car (likely to China or Brazil) to have any chance of meeting profitability.

The Volt is an albatross across the neck of GM and the current debt holders of GM paper.

That'd be the USA taxpayer.

Meanwhile the Prius and the Leaf are doing just fine.

However, if you wish to put your money where your mouth is, the GM dealers are having a fire sale on the car,,,,Here's you best chance to steal one of these beauties....

http://www.auto-price-finder.com/new/car_branded_make?gclid=CIStnKnapLMCFQ4EnQodSnsABQ&land=y
 
Any corporation that is owned 25% by the government is screwed, no matter its board of directors. And now it seems Obama refuses to give up part ownership of Government Motors, so that GM can act like an unencumbered free-enterprise capitalist entity.


Federal Government denies GM request to sell off ownership

By Patrick Rall on Mon, 09/17/2012 - 20:38

According to multiple sources, the United States Treasury Department has declined a plan by General Motors which would relieve the federal government of its portion of the American automaker that was gained via the “bailout loans” through GM’s Initial Public Offering (IPO).
2013%20malibu.JPG

The undesirable piece of shit VOLT

General Motors proposed a plan to the United States Treasury Department earlier this year that would help the feds be rid of the portion of the automaker owned through the IPO with the company purchasing 200 million shares and the other 300 million released for public sale. The end result would be the US government giving up the 26.5% of GM that is currently owned with a large chunk of it going back into the portion owned by the automaker itself while the rest would be sold on the market to the general public. However, the United States Treasury Department has declined this plan as it would bring about a massive loss on the sale of the stock owned by the government.

The United States Treasury Department currently owns roughly 500 million shares of GM stock and that accounts to a 26.5% share of the American automaker. The feds were issued this stock via the GM IPO in November 2010 as repayment for the “bailout loan” granted to GM in 2009. The ideal was that the value of the GM stock would give the government something to show for the bailout loans and in the event that the price of GM stock would rise above the $33 IPO price – the government could essentially turn a profit on the stock issued in exchange for the bailout loans.

Unfortunately, the price of GM stock has gradually decreased since the IPO and the stock that was issued at $33 per share is now worth roughly $24 dollars (GM closed at 23.80 on Monday September 17th). If the government were to sell their 500 million shares of GM stock at the current price – the United States Treasury Department would stand to lose around $15 billion dollars. The government considers that to be a significant enough loss that they are unwilling to go along with GM’s plan to buy 200 million shares and introduce the other 300 million shares to the public for sale. Also, that loss of $15 billion is based on the current price and an introduction of 300 million new shares could send that price event lower…thus increasing the size of the loss on the 2008 “bailout” loans.

The good news is that the United States Treasury Department would consider the GM plan if the price of the stock were to rise into the 30s but it is unclear just how far into the 30s the price would have to rise before the feds would be willing to let their 500 million shares go. That bad news is that for the United States Treasury Department to break even on the bailout loans, the price of GM stock would have to get up to $53 per share and that seems to be something that isn’t going to happen right away – or at least quickly enough for GM and the many critics of the government’s involvement in the American automaker.

This probably comes as disappointing news to the folks at General Motors, as they company surely wants to be able to do business without Uncle Sam having say in major decisions. One of the most publicly voiced complaints by GM has been the fact that the Treasury Department has set a cap on the pay of top executives and the government has made sure that GM has stuck to those guidelines. This, in the opinion of the GM bosses, does not allow the automaker to pay their top executives at the same levels as their counterparts with other automakers – both in the US and around the world. However, the fact that these guys at GM are still making millions per year is likely to make John Q Public side with the government on the issue of pay ceilings.

This news comes at a time when the bailout loans are being scrutinized as a part of the Republican Party’s campaign for the Presidency of the United States. The fact that the government will almost certainly lose money via the stock issued as repayment for the 2009 bailout loans has become a negative point against the Obama administration but in the long run, the bailout loans helped to keep the lights on at GM while the company worked to improve their financial situation. The company is doing far better than they were in 2008 and 2009 (despite the stock prices) so in terms of preserving jobs and this massive American automaker, the bailout has been successful thus far. Unfortunately, the fact that the government will likely lose money when they do opt to sell their ownership of GM will likely continue to spur the “Government Motors” comments from those opposed to the bailouts.
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Catavenger said:
Cheaper to buy a good bicycle & some steroids for transportation :whistling:
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I have been driving the Roads of Connecticut, Rhode Island and New York for the past three days now. For a blue state region bent on saving Detroit and the planet itself with all ouir green initiatives and robust shows of American patriotism (saving Detroit) I am amazed at the lack of GM products on the road.

Lots of Prius owners here. Also Land Rovers , Suburus, Volvo's (you cannot swing a dead cat up here and not hit a Volvo Z70) Mercedes, BMW's and Audi's

Chevy, Buick, Chrysler,(except for Minivans),,rare on the road. Lot's of Fords though.

Go to any red state and the Big three still reign high. Especially pick ups.

But here in the Blue North east, the Union made auto is shunned for the foreign label. I have yet to see a Volt.

Hypocrites.
 
I think GM needs a couple of more 'lectrics.

One could be called the "Amp".

The other could be called "Resistance". But I think they have enough resistance already.:w00t2::w00t2:

Is Toyota now #1?
 
FrancSevin said:
I have been driving the Roads of Connecticut, Rhode Island and New York for the past three days now. For a blue state region bent on saving Detroit and the planet itself with all ouir green initiatives and robust shows of American patriotism (saving Detroit) I am amazed at the lack of GM products on the road.

Lots of Prius owners here. Also Land Rovers , Suburus, Volvo's (you cannot swing a dead cat up here and not hit a Volvo Z70) Mercedes, BMW's and Audi's

Chevy, Buick, Chrysler,(except for Minivans),,rare on the road. Lot's of Fords though.

Go to any red state and the Big three still reign high. Especially pick ups.

But here in the Blue North east, the Union made auto is shunned for the foreign label. I have yet to see a Volt.

Hypocrites.
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Funny thing. As I drive around, plenty of Romney/Ryan signs are proudly posted in the front yards of middle/upper class single-family homes. Lots of 'em. But on the rare occasion I see an Obama/Biden sign, it's just a bumper sticker on the back end of a Prius.

I guess you could say it is indicative of the Party convictions. Romney isn't too far off with the 47% thing.
.
 
Speaking of strange: The neighbors on both sides are die-hard, all-for-the-party, never-vote-another-way Democrats. Their
yards are always full of signs for whoever is running for any position, from dog catcher on up.

Guess who does not have any Obama signs in their yard? Yep, neither one of them. If they are any indication of how the
rank and file Democrats really feel, Michelle had best start picking out curtains for the house in Chicago!
 
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