240,000 potential purchasers... only 10,000 will be built...

[MikeMike]

in the first year, GM has 240,000 people interested in purchasing the Volt, yet only 10,000 will be produced... Sooo what can GM do? well they are looking into ways to double or triple production.

How's your math? If you have 240,000 "potential buyers" but only 10,000 vehicles to sell them in the first year, what can you do? If you're General Motos and the item in question is the Chevrolet Volt, then you look for ways to seriously increase the number of Volts you can build (and, of course, sell).

That's exactly what CEO Dan Akerson says his company is trying to do, looking to double or triple production rates of this very important car. The problem, according to GM North America President Mark Reuss, is the bottleneck created by the limited number of battery cells that vendor LG Chem can produce for GM. The current plan is to make around 10,000 in 2011 and 45,000 in 2012. That 2012 number has already been increased from 30,000.

Upping the production numbers is good for GM for another reason. According to Steven Rattner, who was President Obama's former auto bailout chief and worked intimately with GM, "At least in the early years, each Volt would cost around $40,000 to manufacture (development costs not included)." GM won't confirm this number, but increased production will get the company, presumably, better economies of scale and thus lower production costs.

http://www.autoblog.com/2010/12/01/report-gm-studying-how-to-double-or-triple-chevy-volt-productio/

 

[Soccerman06]

Not really GM's fault, if a supplier can only produce a certain amount of a product in a given time, its not like they can force the supplier to make more. It's not like they are buying duracel batteries from Walmart.

 

[desy]

how many of those actually put cash down or willing to?

 

[HarryLui]

100 interested in buying may only yield 1 person actually have the means to buy

 

[ShawnD1]

100 interested in buying may only yield 1 person actually have the means to buy

This. 240k is a lot of customers. It's unrealistic to expect this many units sold.
Does anyone really think the $40,000 Chevy Volt is going to step into Honda Civic and Toyota Corolla territory for units sold in the first year of production? It anything it would only cannibalize market share from other $40,000 cars.

Top google result for "best selling car in america"
http://autos.aol.com/gallery/best-selling-cars/
The only 3 vehicles out of the top 15 that even come close to $40,000 are the Dodge Ram, Chevy Silverado, and Ford F150 which all happen to be full size trucks. Think about that. There is not even 1 car worth $40,000 that makes it into the top 15.

 

[Pariah]

This. 240k is a lot of customers. It's unrealistic to expect this many units sold.
Does anyone really think the $40,000 Chevy Volt is going to step into Honda Civic and Toyota Corolla territory for units sold in the first year of production? It anything it would only cannibalize market share from other $40,000 cars.

Top google result for "best selling car in america"
http://autos.aol.com/gallery/best-selling-cars/
The only 3 vehicles out of the top 15 that even come close to $40,000 are the Dodge Ram, Chevy Silverado, and Ford F150 which all happen to be full size trucks. Think about that. There is not even 1 car worth $40,000 that makes it into the top 15.

Have you been living under a rock for the past few months? There is a $7500 federal tax credit included with every purchase of a Chevy Volt. So, the base model will actually cost $33,500. Also, the linked article did not in any way try to imply that every one of those interested 240k people were guaranteed to buy a Volt if that many were available. With 10k available, only one out of every 24 of those interested people has to buy before GM runs out. If only 5% actually try and buy a Volt, GM just lost 2000 sold cars. The article also doesn't try and imply that the Volt will sell in numbers comparable to a Civic. All the article is saying is that if GM had the capability to produce more than 10k Volts in the first year, they would likely be able to sell all of them.

 

[LTC8K6]

Isn't MSNBC/GE ordering 15K Volts? To promote it's own charging stations and grid products? And it's green agenda in general?

The Zer0 admin will certainly order a bunch, too. Wonder if they will give themselves the rebate?

http://www.msnbc.msn.com/id/40430655/ns/business-autos

 

[iversonyin]

I highly doubt that the full 240,000 will buy a Volt at the end of the day - if they are being offered one at full price. These are potential customers that will probably cross shop all the hybrid cars.

If they really have 240k potential customers standing by, people would be put on a 5 years waiting list if they walk into a Chevy dealer today.

+ the Volt is a marketing hoax for GM to get more customers. They would not make money in selling them at least for another 5 years or so.

 

[JeffreyLebowski]

have you been living under a rock for the past few months? There is a $7500 federal tax credit included with every purchase of a chevy volt. So, the base model will actually cost $33,500. Also, the linked article did not in any way try to imply that every one of those interested 240k people were guaranteed to buy a volt if that many were available. With 10k available, only one out of every 24 of those interested people has to buy before gm runs out. If only 5% actually try and buy a volt, gm just lost 2000 sold cars. The article also doesn't try and imply that the volt will sell in numbers comparable to a civic. All the article is saying is that if gm had the capability to produce more than 10k volts in the first year, they would likely be able to sell all of them.

$40,000
- $7,500
---------
$32,500

 

[jaydee]

$40,000
- $7,500
---------
$32,500

The $40k figure quoted was the "cost to manufacture". The actual MSRP is $41k: thus, the $33,500 figure.

 

[Zap]

+ the Volt is a marketing hoax for GM to get more customers. They would not make money in selling them at least for another 5 years or so.

Perhaps they are intentionally keeping the numbers low - a believable amount (10k) for marketing but low because it doesn't add to the bottom line?

 

[ShawnD1]

Perhaps they are intentionally keeping the numbers low - a believable amount (10k) for marketing but low because it doesn't add to the bottom line?

If they really do cost 40k to build, it's best not to overbuild them. That would suck to have 10 of these sitting on the lot.

Cars like the Aveo can be overbuilt because they cost 1 bowl of rice to build. If they don't sell, just melt them down as scrap metal and get your money back 😀

 

[MrWizzard]

Things can get interesting when you are in line for a rare-or hard to get car. I remember when I was a kid my dad was going to get a car and before he got it he got a call from the dealer that someone (it was some baseball guy) was willing to pay him 20k to have his spot in line for the new car. My dad turned him down. Heh I'm not sure what I would do if I were in his shoes.

 

[jhu]

Have you been living under a rock for the past few months? There is a $7500 federal tax credit included with every purchase of a Chevy Volt. So, the base model will actually cost $33,500. Also, the linked article did not in any way try to imply that every one of those interested 240k people were guaranteed to buy a Volt if that many were available. With 10k available, only one out of every 24 of those interested people has to buy before GM runs out. If only 5% actually try and buy a Volt, GM just lost 2000 sold cars. The article also doesn't try and imply that the Volt will sell in numbers comparable to a Civic. All the article is saying is that if GM had the capability to produce more than 10k Volts in the first year, they would likely be able to sell all of them.

The issue with the tax credit is that it is not a guaranteed. For example if you're subject to AMT, you won't see any of that tax credit. Similarly if your federal tax is anything less than $7500, you won't be getting the full remote. Thus it's not correct to call this a $32500 vehicle..

 

[LTC8K6]

Yeah, you have to pay the full price if you want to buy. The tax credit would come later if you qualify.

Unless you lease, which most will probably do, making it eerily reminiscent of the Impact...

 

[LTC8K6]

Isn't MSNBC/GE ordering 15K Volts? To promote it's own charging stations and grid products? And it's green agenda in general?

The Zer0 admin will certainly order a bunch, too. Wonder if they will give themselves the rebate?

http://www.msnbc.msn.com/id/40430655/ns/business-autos

http://www.washingtonpost.com/wp-dyn/content/article/2010/12/01/AR2010120106870.html

Ha ha! The Fed bailed out GE...and Toyota...

The Fed then purchased commercial paper issued by GE 12 times for a total of $16 billion.

 

[Lotheron]

http://www.washingtonpost.com/wp-dyn/content/article/2010/12/01/AR2010120106870.html

Ha ha! The Fed bailed out GE...and Toyota...

 

[KeithP]

in the first year, GM has 240,000 people interested in purchasing the Volt, yet only 10,000 will be produced... Sooo what can GM do?

Let the people interested drive the car. That should weed out quite a few. 😉

-KeithP

 

[Pulsar]

+ the Volt is a marketing hoax for GM to get more customers. They would not make money in selling them at least for another 5 years or so.

Uh - no. Not even close. It is an image-builder, certainly. It is, more importantly, a gateway for GM to start developing systems and learning about electric vehicles. You might as well call the leaf and the prius the same if you're going to criticize the volt. All three vehicles are economically unsound and lose money for their manufacturers. It's also very debateable whether or not they truly pollute any less than a good small ICE car does.

This is not a vehicle that is meant to be profitable. It never was. There's no hoax involved, unless you were clueless to begin with and thought that someone GM had made some car out of un-obtanium that would break the laws of physics. It's made in low volumes because it's a niche vehicle - they know that after the initial surge of sales it's very unlike that pace will continue.

So what's your issue with the volt? Did you completely misunderstand the point of the car? Did you have unrealistic expectations? Did you listen to the idiots in the media and not pay attention to the actual numbers?

 

[ShawnD1]

Uh - no. Not even close. It is an image-builder, certainly. It is, more importantly, a gateway for GM to start developing systems and learning about electric vehicles. You might as well call the leaf and the prius the same if you're going to criticize the volt.

Not sure about the leaf, but you probably could argue that about the prius. Even if Toyota doesn't make too much money on each one, each one sold increases the average mpg of their vehicles, so they can get away with building more gas guzzlers while following CAFE standards 😉

For every gaywad driving a prius, that's 1 more supercharged W12 Toyota Land Monster SUV they are allowed to build. One could argue that's a bad thing because your son or daughter will probably die when their Ford Escort is rear ended by an 8,000 lb SUV with a lift kit.

 

[WackyDan]

They are only making 10k because they are losing money on each one sold. Making more in this case doesn't impact the cost to GM as with other volume production.