Hard Times For the Chevy Volt
The Chevy Volt has only sold about 3,200 units thus far, which is not only pathetic, but not even good enough to outsell the Nissan Leaf’s 4500 units. Nevertheless, Government Motors is ramping up for more Volt production. According to Yahoo Auto news, GM is forecasting “sales of around 16,000 for the year as a whole, with 40,000 sold by 2012.
Wait a second. 16,000 units for which year? Calendar year 2011? That means they think sales are going to increase 500% in the next four months? Even if they’re referring to a later fiscal ending date, or even next year, a 500% sales increase is downright delusional.
In fact, Yahoo News thinks a massive sales decline is on the horizon:
A new study by CNW marketing raises a red flag, finding that the potential buyers GM is most counting on are rapidly losing interest in the Volt. In March, 21% of so-called Early Adapters said they were “very likely” to consider buying a Volt, while 38.1% said they were “likely” to do the same. That slipped to 14.6% saying “very likely” in July, and 31.1% “likely.” Among EV Enthusiasts, reports the CNW study, the number of those likely or very likely to consider Volt fell from a combined 71% to 51% during the same four-month period.
“It’s way too early to tell, but the signs aren’t encouraging,” said CNW’s chief analyst Art Spinella. When it comes to mainstream consumers Volt has all but slipped off the radar screen, with only about 3% of new car buyers likely to consider the Chevrolet Volt, the analyst added.
The problem is said to be the price of the Volt, which is a massive understatement, because everyone buying a Volt is understating the price. No one purchasing a Volt has the faintest clue what it really costs, because of all the taxpayer subsidies plowed into production, and hefty rebates offered at the point of sale. $400 million in federal subsidies were extracted from the taxpayer to fund Volt production, and buyers have enjoyed a $7500 federal tax credit.
That means each of the 3200 Volts sold thus far has rolled out of the lot with $132,500 in taxpayer subsidies stuffed in the glove compartment. They sticker at $41,000, so that means each Volt sold thus far actually costs $173,500, with only $33,500 paid by the actual purchaser.
What if GM’s rosy sales predictions come true? Assuming the $7500 tax credit says in place, that would bring the total subsidies paid for Volt production and sales up to $700 million. Divided by 40,000 automobiles, that works out to $17,500 in subsidies apiece. The Volt is about to have a price drop to $39,995, so by 2012 the true price of each car would be a mere $47,495.
On the other hand, if sales hold steady or decline as the CNW study predicts, we’d see about 7000 Volts sold through 2012 at best. That would work out to total taxpayer subsidies of $64,642 per vehicle, for a total per-unit price of roughly $104,000.
So, here are some lessons for those foolish enough to continue believing in the “green economy,” and wondering why billions of dollars have been seized from future taxpayers without visible benefit to employment or GDP:
1. Very few people want to buy a crummy little electric car for $40,000.
2. Nobody can make a crummy little electric car that sells for $40,000.
3. Absolutely no one wants to buy a crummy little electric car for the true price of over $100,000 apiece.
4. It is an outrage to compel taxpayers to subsidize the fantasy of a tiny group of politicians and their followers that crummy little electric cars can be sold for $40,000.
5. There is nowhere taxpayers can go to get their money back after this miserable failure, so it is vital to ensure that people who support nonsense like the Volt, and the rest of the Obama “green jobs” agenda, are never elected to any office, anywhere, ever.