GM "Electric Car is Not Dead" Despite Mediocre Sales
Jason Mick (Blog) - The Daily Tech January 17, 2013 7:19 PM
When it comes to sales General Motors Comp.'s (GM) Chevy Volt has done modestly, moving a couple thousands units per month in good months. Compared to other entrants such as the Nissan Leaf EV from Nissan Motor Comp., Ltd. (TYO:7201), whose sales number in the mere hundreds per month, that's not bad.
But sales have still been short of the hype that surrounded Volt, a car that was viewed by many as a "savior-car" of sorts for the automaker during its recession troubles. The Volt has suffered a 2011 National Highway Traffic Safety Administration (NHTSA) investigation over battery fires and more recently has been rejected by some Chevy dealerships over high tooling costs.
Still, GM is convinced that electric vehicles are a winning proposition. Wednesday night at the Automotive News World Conference GM's North America chief Mark Reuss boldly proclaimed, "The electric car is not dead... We couldn't be happier … with the Volt."
The Chevy Volt has seen several sales targets slip. In 2011 GM promised to sell 10,000 Volts, but only sold 7,700. In 2012 it predicted 45,000 units sold, but only moved 23,000. At times the Hamtramck Assembly Plant where the vehicle is assembled was idled.
GM is forging ahead, looking to fill the idle capacity at the Hamtramck Assembly Plant with orders of the new Cadillac ELR, which is essentially a luxury reskinned Volt. At the conference Mr. Reuss revealed that the plant would begin producing Cadillac ELRs before the end of the year.
The 2014 Cadillac ELR will begin production later this year. [Image Source: GM]
He also teased at the upcoming second generation Volt design, which he claims "will be even better". He comments, "We'll get there. We will see the day when we have an affordable electric car that offers 300 miles of range with all the comfort and utility of a conventional vehicle. We're talking about a transformation here. And transformation takes time."
He admits that pricing needs to become more competitive, stating, "The rest of them will come around when technology advances electric vehicles to the point where they offer comparable performance at comparable prices."
GM looks to get more competitive with Chevy Volt pricing when it releases its second-generation successor to its current EV. [Image Source: Autoblog Green]
The determination from the Detroit automaker runs counter to its previous approach from the 1990s, where it debuted the EV-1 only to bail, pulling the plug in 1999 after three years of poor sales. GM was oft villainized for that decision for much of the last decade; now it is celebrated by EV advocates as a key proponent of the advanced vehicle push.
The optimism also contrast sharply with the grim rhetoric of Nissan at the auto show. While Nissan is sticking with its LEAF EV, it's dropping the price (to $28,800 USD) and admitting that so far the project has been a flop. LEAF EV sales were essentially flat, up only 1.5 percent from 2011 to reach 9,819 units. Nissan CEO Carlos Ghosn admitted this week; "It was a disappointment for us."
Others like Ford Motor Comp. (F) have been more restrained in their EV dive, but have also suffered poor results. Ford produced 1,627 2013 Ford Focus EVs, but only sold 685 (42 percent of the stock). Fiskar also suffered a rocky year with its Karma being panned by reviewers as "overweight". The Karma also suffered fire issues leading to recalls and 320 of the pricey EVs were destroyed when Hurricane Sandy hit.
Tesla Motor Comp. (TSLA) also saw slow sales for much of the year, but like GM it also delivered a fair degree of good news, becoming profitable again late in the year, thanks to the launch of the 2013 Model S mid-range luxury electric sedan. The Model S was well received by reviewers who gave it many awards for its slick handling and performance.
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