Electric Vehicles Gaining Acceptance
Even after a presidential endorsement and the support of leading environmental groups, the Chevrolet Volt still needs to be embraced by consumers when it comes to market later in the year.
General Motors brand new extended-range model, the Volt, is just one of many advanced electric cars that will debut in showrooms over the next few years. Many believe that the switch to electric powered cars will be the critical step in reducing the country’s oil dependence. It is also seen as a step towards the reduction of global warming.
Skeptics bring up the viability of a car like the Volt, saying its high cost and limited range are factors that could make the price of gas seem affordable.
Joe Phillippi, an analyst at AutoTrends Consulting, said he was surprised by the Volt’s price tag, at $41,000; it is higher than the figure expected. Also much higher than a comparable, well-equipped compact sedan using a conventional gasoline engine.
Rush Limbaugh, a conservative talk show host, used the Volt to go on a tirade against GM. He projects it will be a total failure. Many commentators in mainstream media also have questions regarding the Volt’s viability.
The price tag, is clearly too high, when compared with the other major battery car launch scheduled for later this year. Nissan’s new model, the Leaf, will cost just under $33,000. Both the Leaf and the Volt are eligible for a $7,500 federal tax credit.
Both GM and Nissan expect they will lease a large number of their new battery models, maybe even the majority of them. If that were the case, Nissan’s price advantage mostly disappears, as both cars will cost around $350 a month to lease. Perhaps, that is a figure green-minded automobile drivers can accept.
Even with all of the skepticism Chevrolet is beginning to make plans to increase the volume of production for the Volt. A spokesperson for GM says that the automaker has “a couple of indications” that some dealers plan to charge a premium on top of the Volt’s already large price tag, relying on the early adopters of the car will be desperate to get one of the firsts. But even with the bump in production, an average Chevy dealer will only be sent between four to six of the battery cars during its first year on the market. And though the factory has no control over what dealers charge, there are some ways to discourage predatory pricing on new products like this.
GM has plans to increase production of the Volt gradually in coming years, with 45,000 models to come in the second year. Nissan is also taking a conservative approach to its launch of the Leaf. Initially, it will only be offered to fleet buyers, including about 100 Enterprise Rent-a-Car locations, allowing the automaker to gauge consumer reaction.
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Posted by Brett Nordin
on Feb 17 2011. Filed under Automotive.
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