GM Exec Admits Volt is Stepping Stone to All-Electric Cars

As we’ve talked about on these pages before, the battle for the hearts and minds of the next generation of car purchasers is starting. By the end of the year many major auto manufacturers will have some kind of electric vehicle for sale on the mass market and by 2014, nearly all major manufacturers have plans to introduce at least one electric car.

In these early stages, carmakers have chosen several different paths, some opting to go for the cars powered solely by batteries (Battery Electric Vehicles or BEVs) such as the Nissan LEAF, some for the plug-in hybrids (PHEVs; like a Prius with a bigger battery), and some for the extended range electric vehicles (EREVs with small generators on board to charge the batteries) such as the Chevy Volt.

Chevy has chosen to go with the more expensive EREV option because they felt that the idea of “range anxiety” would be so all-consuming to the initial electric car consumer that it would drive them away from buying one. Although there is research showing the range anxiety question may be overblown, GM has stuck to its guns believing that the question will trump all other consumer considerations. But it now appears that even GM sees EREVs as a stepping stone to a future filled with the less expensive BEVs.

In a post over at GM-Volt, Mark Reuss, GM’s new North American President, has come right out and said that long term demand for BEVs will be higher than EREVs, but that EREVs are necessary to get to the BEV future. “While EREV will be wildly popular at first with Volt, as the technology flows down to BEV in what will be smaller cars to carry smaller packs, that may be the higher volume play over a longer time,” Reuss was quoted as saying.

I’m not sure about this logic. It already appears that battery prices are dropping much faster than expected and that consumers may never even have the chance to really worry about range anxiety in the first place, given that most buyers will probably own two cars (a gas one and an electric one) and that most days they will drive far less than the 80-100 mile electric range. I’m just not clear what the incentive will be to buy a $40,000 Volt over a $25,000 LEAF unless you are planning on replacing just one car. And even then, how many one car households are going to go out and plunk down $40,000?

Actually, GM’s argument that EREVs are a stepping stone to BEVs runs opposite to what I’ve always felt; that BEVs are the stepping stone to EREVs. BEVs are much cheaper and easier to engineer. Bring them on and market them as a second car in two (or more) car households. Then, when battery prices come down from the adoption of BEVs, build EREVs to meet the needs of one car households, or to replace all the cars in a two (or more) car household.

Only time will tell, but I’m starting to get a bad feeling about this for GM. Too bad we, the taxpayers, still own them… hurry up and buy yourselves back already GM!



Nick Chambers

Not your traditional car guy.