Published on March 11th, 2011 | by Christopher DeMorro
Why Doesn't GM Build a Diet Chevy Volt?
Without a doubt the biggest knock against the Volt isn’t its limited electric range or its so-so fuel efficiency, but the $41,000 price tag. Yet GM has the ability to make a much cheaper Volt. So what’re they waiting for?
GM doesn’t make a dime off of every Volt they sell, having invested a large amount of money into the extended-range electric vehicle. While these costs will be spread out as the Voltec technology makes its way into other vehicles, right now the $41,000 Volt ($33,500 with the Federal Tax Credit) simply costs too much money for many people. Much of that cost comes from the large 16 kWh lithium-ion battery pack in the Volt’s floorboard, and GM estimates that the cost-per-kWh for the battery is around $500-600 per kWh. That means the battery alone makes up between $8,000 and $10,000 of the Volt’s $41,000 price tag.
But what if they offered a cheaper Volt with a smaller battery pack? Think of it like a Diet Volt. Obviously the all-electric range would take a hit, but you’d also be shaving off a couple of hundred pounds off of the Volt’s curb weight. If I may present a hypothetical case, what if GM offered a cheaper Volt with say, a 8 kWh battery? You could shave $4,000 to $5,000 off of the Volt’s MSRP, and now the Volt has a starting price just a couple of grand more than the Nissan Leaf (lets say $36,000.)
Apply the Federal Tax Credit of $2,500 plus $417 per kWh after 5 kWh for a total tax credit of about $4,200 and the price is now around $32,000. If you live in California (where 40% of Volts have been sold to-date) you get another $5,000 tax credit, bringing the price down to around $25,000, or just a few grand more than a fully loaded Chevrolet Cruze Eco. Plus you’ve still got an all-electric range of 12-25 miles (better than the upcoming Prius Plug-In) and after that, a regular hybrid that is still capable of between 33 and 36 mpg. The Volt has suddenly become affordable, practical, and much more economically viable.
This is probably what GM should have done in the first place, but its not too late to implement a plan for just such a car.
Would $25,000 Chevy Volt with half the EV range be more appealing than the current model?
Edited because the Federal Tax Credit is based on battery size; an 8 kWh Volt would only get around $4,200 from the tax credit rather than the maximum amount of $7,500. So a smaller battery might not actually make sense.
Source: Hybrid Car Blog
Chris DeMorro is a writer and gearhead who loves all things automotive, from hybrids to HEMIs. You can read about his slow descent into madness at Sublime Burnout or follow his non-nonsensical ramblings on Twitter @harshcougar.