Chevy Volt – yeah, it’s a lemon
Government Motors (GM) recently announced that the Chevy Volt will be available in November with a sticker price of $41,000. Even with a $7,500 taxpayer rebate and other assorted subsidies, the price tag will be in the neighborhood of about $35K – not something most people can afford, regardless of their desire to be “green.” Furthermore, while marketed as a “midsize,” the Volt only seats 4 and has less head/leg room than the $17K Chevy Cruze – and less trunk room as well. This piece from the NY Times (a propaganda arm of our dear comrade leader’s regime), pretty much sums it up. The Volt is a lemon.
GENERAL MOTORS introduced America to the Chevrolet Volt at the 2007 Detroit Auto Show as a low-slung concept car that would someday be the future of motorized transportation. It would go 40 miles on battery power alone, promised G.M., after which it would create its own electricity with a gas engine. Three and a half years — and one government-assisted bankruptcy later — G.M. is bringing a Volt to market that makes good on those two promises. The problem is, well, everything else.
For starters, G.M.’s vision turned into a car that costs $41,000 before relevant tax breaks … but after billions of dollars of government loans and grants for the Volt’s development and production. And instead of the sleek coupe of 2007, it looks suspiciously similar to a Toyota Prius. It also requires premium gasoline, seats only four people (the battery runs down the center of the car, preventing a rear bench) and has less head and leg room than the $17,000 Chevrolet Cruze, which is more or less the non-electric version of the Volt.
In short, the Volt appears to be exactly the kind of green-at-all-costs car that some opponents of the bailout feared the government might order G.M. to build. Unfortunately for this theory, G.M. was already committed to the Volt when it entered bankruptcy. And though President Obama’s task force reported in 2009 that the Volt “will likely be too expensive to be commercially successful in the short term,” it didn’t cancel the project.
So GM’s answer to the Prius is this expensive money loser? Sounds like a (government) plan to me. The problem is that we the taxpayers are on the hook for this.
So the future of General Motors (and the $50 billion taxpayer investment in it) now depends on a vehicle that costs $41,000 but offers the performance and interior space of a $15,000 economy car. The company is moving forward on a second generation of Volts aimed at eliminating the initial model’s considerable shortcomings. (In truth, the first-generation Volt was as good as written off inside G.M., which decided to cut its 2011 production volume to a mere 10,000 units rather than the initial plan for 60,000.) Yet G.M. seemingly has no plan for turning its low-volume “eco-flagship” into a mass-market icon like the Prius.
And just how much are the taxpayers “invested” in this lemon?
Quantifying just how much taxpayer money will have been wasted on the hastily developed Volt is no easy feat. Start with the $50 billion bailout (without which none of this would have been necessary), add $240 million in Energy Department grants doled out to G.M. last summer, $150 million in federal money to the Volt’s Korean battery supplier, up to $1.5 billion in tax breaks for purchasers and other consumer incentives, and some significant portion of the $14 billion loan G.M. got in 2008 for “retooling” its plants, and you’ve got some idea of how much taxpayer cash is built into every Volt.
In the end, making the bailout work — whatever the cost — is the only good reason for buying a Volt. The car is not just an environmental hair shirt (a charge leveled at the Prius early in its existence), it is an act of political self-denial as well.
If G.M. were honest, it would market the car as a personal donation for, and vote of confidence in, the auto bailout. Unfortunately, that’s not the kind of cross-branding that will make the Volt a runaway success.
Again, the ultimate (and only) result of government management of private industry is FAIL. It simply cannot be anything but FAIL and FUBAR.
I leave you with an anecdote from Judge Andrew Napolitano. It is in reference to obamacare, but it could easily apply to Government Motors:
Can the government run the health care system? Let’s see:
Medicare – broke
Medicaid – broke
Social Security – broke
Amtrack – broke
The Post Office – broke
With a track record like that, who in their right mind would give health care to the same people who have broken everything they have tried to manage?
In 1999 the IRS took over the famous Mustang Ranch in Nevada and after a short time, it went under. Now, if the government can’t even break even selling booze and hookers to truckers, do you think it can run the health care system?
Or a vehicle manufacturer?