“It’s true, we’re not making money yet [on the Volt]”, said Doug Parks, GM’s VP of global product programs and former Volt development chief. It costs General Motors an estimated $75,000-$88,000 to build every single Volt, which sell for a base price of $39,995. Complex technology and over engineering are cited as the major issues in the Volt, as the lithium-polymer batteries and sophisticated electronics keep production costs high.
Rock bottom lease prices are one incentive that has been placed on the Volt to help sales, as well as a $7,500 federal tax credit. Still, year-to-date sales of the car at the end of August were 13,500, well below the projected 40,000 unit goal that GM had set for 2012.
The second generation Volt is due out in within the next two years, and will apparently propel the line back into the money making category. “There is a strong push on the cost of the Gen 2 to get the car to make money and to be more affordable . . . Virtually every component in the next-gen car is going to be cheaper,” Parks said.
Another way for GM to push down per-vehicles development costs is to produce more volume. If Chevy could move 120,000 Volts in a year, the per-vehicle cost would come down to around $10,000.
Stiff competition is also plaguing the Volt, with cars such as the Toyota Prius and Ford C-Max undercutting Chevy’s range-extended EV by a large margin. The standard Prius can be had for $24,795, while the plug-in version costs $32,795. As for the new vehicle from cross town rival Ford, the C-Max Hybrid will start at $25,995, while the C-Max Energi plug-in hybrid can be had for $33,745.