Electric-Car Fans Rally Around the Volt

By dancurranjr On April 22nd, 2009

phev-voltElectric car supporters are rising to defend General Motors’ development of the Chevy Volt after the Obama Administration’s automotive task force proclaimed that the car was probably too expensive to be commercially successful in the near future.

G.M. is hoping to launch the Volt in late 2010 with a price tag of about $40,000.

“While the Volt holds promise, it is currently projected to be much more expensive than its gasoline-fueled peers and will likely need substantial reductions in manufacturing cost in order to become commercially viable,” the task force noted in its recent assessment of GM’s restructuring plans. About $750 million is needed for near-term Volt development, according to the company.

Advocacy groups argue the task force’s assessment is shortsighted and worry that the Volt project may land in the scrap heap as G.M. rolls toward bankruptcy. Financial aid for such projects has been put on hold as G.M. and Chrysler struggle to come up with business plans that regulators will embrace.

“Any new technology like the Chevy Volt takes time to become profitable,” said Jay Friedland, the legislative director for Plug-In America, an electric-car advocacy group. “The Toyota Prius took over five years to reach break-even and has gone on to be a wild success.”

Electric car proponents at The California Cars Initiative believe the task force was unduly influenced by “plug-in skeptics” at the Boston Consulting Group, which is under government contract to provide input on the prospects for G.M. and Chrysler.

“Whatever B.C.G.’s expertise on the auto industry in general, we are concerned that in its understanding of future pathways, it offers a flawed analysis and predictions based on business-as-usual,” notes a posting on the California Car Initiative’s Web site.

The group pointed to a B.C.G. report titled, “The Comeback of the Electric Car? How Real, How Soon, and What Must Happen Next,” which concludes the costs of creating an automotive market dominated by electric and hybrid cars are prohibitively high for the foreseeable future – as high as $49 billion for Europe alone (along with another $21 billion for battery-charging infrastructure).

Still, the word from on high is that the Volt will make it to the finish line.

“Volt will survive and prosper,” G.M.’s vice chairman of product development, Robert Lutz, reportedly told Volt enthusiasts at the Web site GM-Volt.com. “We know the numbers better than the Government … we furnished them! First-generation technology is expensive, but you can’t have a second generation without a first generation.”

During his campaign, President Obama said he would work to put one million plug-in hybrids on American roads by 2015. Currently there are only about 1,500 500 plug-in hybrids and 500 1,500 pure electric cars, according to Plug-In America.

SOURCE: New York Times

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