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USA: What’s ailing the Chevy Volt? What’s ailing the Chevy Volt?

On Friday, GM announced it was halting production of the Chevrolet Volt until April, so as to maintain “proper inventory levels.” Sales of the electric vehicle have been disappointing, with the company missing its target of 10,000 Volts sold last year. Why hasn’t the car caught on?

Not buying it. (REBECCA COOK/Reuters) GM executives have said the recent frenzy over a Volt battery fire in crash tests has hurt sales. On the merits, the fires weren’t a huge concern — the Volts only caught fire days or weeks after extreme lab testing, and according to a government investigation they’re no more likely to catch fire than gas-powered automobiles. Still, panicky headlines ensued. Conservatives started denouncing the company (Rush Limbaugh called GM “a corporation that’s trying to kill its customers”). And GM needed to retrofit new vehicles. Add that up, and GM sold only 603 Volts in January, down from 1,520 in December.

But the scare over batteries is only a partial explanation. After all, Volt sales rebounded in February to 1,023 vehicles sold, and it looks like the fire scare is slowly subsiding. But neither the pre-panic nor post-panic numbers were anywhere near the rate needed to meet GM’s goal of 45,000 Volt deliveries this year.

A more likely explanation is that the Volt is just far too expensive for many customers. The car gets about 94 miles per gallon, according to the EPA, but it starts at $39,195, and only upper-income buyers with a big tax bill can qualify for the $7,500 federal tax credit. As auto analysts Jonathan Welsh writes, “Even if you never used gasoline in the Volt, you’d wait about 12 years before you saved enough on gas to make up for the Volt’s price premium.” (The Volt has a gas engine that kicks in when the battery runs out.)
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