Is the Volt nothing more than bailout bait?
by Domenick Yoney on Jul 2nd 2008 at 5:11PM 
The Wall Street Journal has been known to be a bit cynical when it comes to the Chevy Volt but does it really think GM is using a whole program just to angle cash out of Washington? That seems to be the what Holman W. Jenkins, Jr. is arguing in his article, "What Is GM Thinking?" According to the author, because GM's stock is at historic lows and the idea that the public would change their minds about the kinds of cars they want because fuel costs are rising is "crazy," the only reason GM would be pouring hundreds of millions of dollars into a car that is "guaranteed to lose money on every unit" is because the company can use the environmental cache of the Volt to give law-makers political cover to throw cash at the iconic American brand. We think that, while this kind of wild-eyed speculation is all very well and good for some amateur car blog to delve into, this is written up in the respected Wall Street Journal.
Although the main premise of the piece may be slightly awry, we can surely take heart that the writer knows a little about the vehicle he is writing about. Let's look at a few of his
- "GM is saying now the Volt may need a sticker price of $45,000"
- "The car will be lucky to get 15 mpg under gasoline power"
- "A car with the Volt's narrow usability to sell would require an unlikely revolution in consumer behavior"
[Source: Wall Street Journal]
Reader Comments (Page 1 of 4)
Potzon 5:35PM (7/02/2008)
Many people familiar with auto business know that GM is going down (perhaps in 2 to 3 years).
But I am not sure of the Volt’s purpose because obviously this car is ridiculously inefficient. Maybe Mr. Jenkins knows something we don’t.
And don’t get me wrong, electric cars are the way to go. Just not this one.
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James Bowe 8:18AM (7/03/2008)
How is it inefficient? If it hits it's targets it will go 40 miles sans fuel and get a solid mpg rating after 40. So on a typical day, driving to work and back, maybe to the gym, supermarket and/or out for dinner. You could conceivably go without using any gas. That's inefficient? I think I need a dictionary, maybe I've got the meaning of the word wrong.
BTW Domenick - the new comments section is great, except that I have to go to my email account and confirm every time I comment. That is enormously irritating, what happened to the password box?
ww1251 9:19AM (7/03/2008)
Obviously you're even more ignorant that the writer of that article! The gas engine never powers the car, it only recharges the battery pack.
Soccer Mom 9:17AM (7/03/2008)
Wow, that is a lot of questionable statements in one post.
Many people familiar with auto business know that GM is going down (perhaps in 2 to 3 years).
>> Who are those people? Based on what analysis did they come up with such estimates?
But I am not sure of the Volt’s purpose because obviously this car is ridiculously inefficient.
>> Inefficient in what way, inefficient in burning fuels at high rate? There is no functional prototype available for testing. The only way to judge it at this point is using GMs estimates. So how did you figure out it is inefficient?
And don’t get me wrong, electric cars are the way to go. Just not this one.
>> Why not this one? How is it that other electric cars are the way to go, just not this one? If we change a badge on the hood, leaving the rest intact, will it help?
Potzon 3:45PM (7/03/2008)
IInefficient: Weak aerodynamics (typical American look), fat tires, ridiculous decision of charging batteries with internal combustion engine, price?! (not sure but if around $40K this car is dead before it’s ready). It has nothing revolutionary in it.
Volt inefficient, Aptera efficient.
About the financial situation … this only an opinion not a fact.
CM 8:17PM (7/03/2008)
While I agree that the Aptera will be much more efficient, the Volt design will still have a big efficiency improvement over most other cars on the road. The Volt can take advantage of many hybrid fuel economizing measures, and should perform similarly.
Potzon: The prototype concept is not what will go into production, GM already realized that the aerodynamics was horrible and have changed it. Also, contrary to the common rumor, most of the power output from the IC engine and generator will go directly to the motor driving the wheels and not through the battery. The only time the IC engine and generator will charge the batteries is when there is an excess of power available to do that - and then only to about 55% charge.
Joe 10:10PM (7/03/2008)
The whole purpose of a plug-in hybrid is to meet the average person's need in a commuter car.
The average person travels less than 40 miles on a day to day basis so a car that can perform that purely on a battery is what makes this efficient. The gas engine is a back up to get the car to a plug so that it can recharge if you have to travel further. If a person bought this car mainly for commuting to work within a 40 mile commute the gas engine efficiency is irrelevant.
You're confusing this concept with a normal hybrid and/or an electric car.
Akin 5:39PM (7/02/2008)
Well this is typical News Corp "journalism". Not surprised.
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Deutchland 5:13AM (7/07/2008)
They are news corp? Well, as can be expected then. F*ck News Corp. and all the US media owners for that matter. Yes, you too Time Warner. If only I could buy out AutoBlog.
david 5:41PM (7/02/2008)
This guys looses all credibility the minute he said 15mpg. I'm surprised WSJ would publish that crap.
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Larry Miller 5:50PM (7/02/2008)
Methinks Jenkins is shilling for the oil companies.
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Ignatius 6:25PM (7/02/2008)
So yeah, where the hell did he get this 15MPG bullcrap?
Second off, the car is never driven directly from gasoline power. Gasoline is burned by an ICE, converted to electricity for the batteries and an electric engine drives the vehicle.
Must be a very slow news day for Wall Street, they're making crap up now.
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SawThat 8:19AM (7/03/2008)
15MPG is a bit pessimistic, but the Volts means of transferring ICE power to the wheels by comparison to a non hybrid car is inefficient.
First: Any time you have to convert from one mode of power to another there will be energy lost. Converting gasoline to mechanical movement (ICE) to electricity (generator) to an electric motor has alot of potential for wasting energy. None of those components are 100% efficient and the wasted energy just stacks up with each conversion. I'm sure this is how he's assuming 15MPG, but how he came up with that number is probably sheer speculation.
Secondly: How is plug-in the way to go? Coal burning plants are still the #1 source of carbon output for the country and the #1 source of electricity. This country (and world) is being misguided in thinking that plug-in cars will be our saving grace when very little is being done publicly about the means of producing that power. Has everyone forgotten the energy shortages we had a few years ago on the West coast? Anyone remember the brown-outs on the east coast and midwest? The "experts" say 'just plug in your car at night when electricity demand is low', but the power companies anticipate that low demand so they can reverse their hydroelectric turbines to re-fill their water reservoirs in preparation for the next peak load on the following day.
There is no way that our grid can support electric vehicles without major upgrades and power plants. If you're going to talk about electric cars, you better start pestering the power companies about being able to supply this energy to your house.
pixelnate 10:51AM (7/03/2008)
"Secondly: How is plug-in the way to go? Coal burning plants are still the #1 source of carbon output for the country and the #1 source of electricity. This country (and world) is being misguided in thinking that plug-in cars will be our saving grace when very little is being done publicly about the means of producing that power."
I don't know about you guys, but there isn't a day that goes by that I don't see turbine parts heading for West Texas. My power company is heavily investing in wind power. And if I really was getting a Volt (which I now cannot afford), I'd probably invest in some solar panels to decrease my "fuel" costs from my power co. If everybody had solar panels, cars like the Volt would be the only way to go.
Ignatius 11:58AM (7/03/2008)
While energy is lost in that conversion, you must also remember that it is much easier for a small, efficient gasoline engine to burn at a constant RPM and not have to push an entire vehicle at the same time. It is merely an alternator for the batteries to recharge.
Even though energy is 'lost' during the conversion, the efficiency of the system makes up for it. All that is needed now is a way to siphon the excess thermal energy and convert it directly to electricity.
The best way for this would probably be the most common use of heat, to boil water into steam which turns a turbine. If that was made possible with several small chambers, it might even raise the efficiency further.
porschedevotee 6:26PM (7/02/2008)
15 mpg? That seems ludicrously low. I'm also disappointed but not terribly surprised to hear the price keeps creeping up. In fact, as the price of gas keeps going up, GM may even feel they can afford to increase the price a little because it will be much more desirable, not just so they don't take so much of a loss.
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porschedevotee 6:27PM (7/02/2008)
Oh, and the new comments section is great! Love the new layout and color scheme too :)
Doug Korthof 6:27PM (7/02/2008)
"GM can save itself: resume production of EV1"
General Motors (GM) has been hurt by not having the right cars to sell ("U.S. car firms flat-out hurting", June 27).
http://www.latimes.com/business/printedition/la-fi-autos27-2008jun27,0,5737426.story
GM has been seriously looking for options for getting more fuel-efficient cars on the market quickly, because there is some question about its financial health after 2008. Rebranding foreign cars has become more expensive as the dollar falls, and new vehicles require years-long development cycles.
GM has proposed producing the VOLT, described as an Electric car with a range-extender, but it isn't planned for earlier than 2011. The VOLT depends on Lithium batteries which are not yet proven successful in an Electric car, as Lead and Nickel batteries were perfected over millions of test and customer miles in actual all-electric EVs.
There is one option GM has not considered, which would turn things around, both in image and in reality. It's simple, not dependent on a gamble, will work right now, and won't exclude the possibility of some day producing the Lithium VOLT or other EVs and serial hybrids.
GM could resume production of the 1999 EV1, using Panasonic EV-EC-1260 lead-acid batteries. These were leased in Arizona in 2000, and regularly attained a range of over 100 miles on a charge. The life-cycle cost is the lowest of all battery options.
GM claims they were "unable to sell" the EV1; typical of GM's current disconnect with reality, GM never offered even one for sale, explaining why the EV1 didn't sell.
If you refuse to sell a car, don't be surprised if it doesn't sell. Is this an example endemic to GM's current failure, as noted in financial articles, with a Market Value less than Starbucks?
Resumption of production would be simple; the EV1 plant is empty, the former assembly workers have been laid off and are idly drawing "jobs bank" salaries, the batteries are available off-the-shelf in any quantities over 1000, and the design is proven successful.
Production of the EV1 does not depend on an expensive product design cycle, new engineering, questionable battery testing and recalls; it's a proven winner.
This is the GM car that fans watched over in a rain-plagued vigil for 28 days. Here's an example where would-be purchasers clamored for a chance to buy GM products, hoping for the faint chance that GM would sell six-year-old used versions for $25,000 cash.
According to one GM exec, each EV1 cost "well over $80K to produce". If so, that would make GM's relentless confiscation and destruction of each and every EV1 even more difficult to understand. However, the 1150 EV1 were hand-built in batches, instead of using GM's traditional manufacturing excellence; in mass production, the cost would come down, by one estimate, to less than $11,000, leaving GM a signficant profit margin -- and allowing GM to scoop the competition.
GM is now bemoaning the lack of enthusiasm for its current products; why not re-activate the EV1 fan club, recharge the excitement of the "21st century test pilot" GM fans, and turn GM around? Spend scarce engineering dollars on new versions of the EV1: four-passenger, pickups, serial hybrid with range-extender; but the current version could be in showrooms in six months. Even if it didn't sell, it would draw in floor traffic.
While Lithium may pan-out, as GM's Bob Lutz claims, there's a lot to life-cycle costing of batteries that so far has precluded Lithium's practical use in Electric cars. To date, no Lithium-powered EV has gone more than 50,000 miles without significant battery degradation. Lithium is unproven, as one recent story has pointed out, while the batteries used in the EV1, both Lead-acid and Nickel, were tested and proven successful.
Nickel batteries are running well over 100,000 miles in the Toyota RAV4-EV.
All successful Electric cars, such as the Toyota RAV4-EV and the GM EV1, started with Lead batteries and were later upgraded to Nickel. Why not repeat past success, and start now with lead or nickel, later upgrading to Lithium when it is proven? GM, according to CEO Wagoner, has enough liquidity to last through 2008, but he refused to comment on 2009. GM may not last long enough to fund the perfect electric car it now spends a fortune advertizing it will some day produce.
If GM had re-started the EV1 line at the same time it starting design work on the VOLT, the EV1 would already be generating revenue right now.
Fresh off the assembly line, these cars would sell for no less than $35,000, perhaps as much as $50,000 or more. But the morale value would be even greater.
Revival of the EV1 would quiet GM's critics, make GM some money, and attract new customers as well as increase floor traffic for other models. New and improved versions of the basic Electric car, year after year, would expand GM's footprint on the world market, leveraging scarce investment dollars, maximizing profit and leading the way forward.
And we could say once again that our cars were "made in America and fueled by American Electrons".
Is it a measure of GM's past failure that resumption of EV1 production is not even under consideration?
/Doug
562-430-2495
1020 MarVista
Seal Beach, CA 90740-5842
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Spence 7:53PM (7/02/2008)
Dude, it may be a new comments section, but that doesn't make cutting and pasting any more acceptable. Knock that crap off!
db 6:15AM (7/03/2008)
Bob Lutz claims that GM was losing $80K on each of the EV1s.
Even if they sold a newly re-vamped EV1 at $81K I'm pretty sure there would be some buyers in limited batches.