The Chevy Volt

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The "Little Secret Behind the Chevy Volt"! And now you will know 'The Rest of the Story.

 

Patrick Michaels is a senior fellow in Environmental Studies at the Cato Institute and is also the editor of the forthcoming Climate Coup: Global Warming's Invasion Of Our Government And Our Lives, as well as the author of several other books on global warming. His Forbes column on the Chevy Volt is a case study in the nexus between big government corruption and big business rent-seeking.

 

Michaels briefly recaps the well-known consumer fraud in which GM has touted the Volt as an all-electric mass production vehicle on the supposed basis of which its sales receive a $7,500 taxpayer subsidy, which still renders it overpriced and unmarketable.

 

Michaels notes that "sales are anemic“:326 sold in December,321 sold in January, and 281 sold in February." Doesn't there seem to be a trend here?“

 

Michaels adds that GM has announced a production run of 100,000 vehicles in the first two years and asks what appears to be a rhetorical question: "Who is going tobuy all these cars?"

 

But wait! Keep hope alive! There is a positive answer to the question. Jeffrey Immelt's GE will buy a boatload of those uneconomic GM cars. GE is also awash in windmills waiting to be subsidized so they can provide unreliable, expensive power.

 

Here, the case study opens onto the inevitable political angle: Recently, President Obama selected General Electric CEO Jeffrey Immelt to chair his Economic Advisory Board. Consequently, and soon after Mr. Immelt's appointment he announced thatGE will buy 50,000 Chevy Volts in the next two years, or half the total Volts produced by GM. Assuming that the corporation qualifies for the same taxpayers subsidy credit, we (you and me) will shell out $375,000,000 to a company to buy cars that no one else wants, so that GM will not tank and produce even more cars that no one wants.And this guy is the chair of Obama's Economic Advisory Board?

 

But of course.

 

Michaels also includes this hilarious detail in his case study: In a telling attempt to preserve battery power, the heater is exceedingly weak. Consumer Reports that their tests averaged a paltry 25 miles of electric-only running, in part because it was testing the car in cold Connecticut. A GM engineer at an Auto Show stated that cold weather would have little effect on performance.

 

It will be interesting to see what the range is on a hot, traffic-jammed summer day, when the air conditioner will really tax the batteries.

 

Also when the gas engine came on, Consumer Reports got about 30 miles to the gallon of premium fuel; which, in terms of additional cost of high-test gas, drives the effective mileage closer to 27 mpg.

 

A conventional Honda Accord, which seats 5 (instead of the Volt's 4), gets 34 mpg on the highway, and costs less than half of what Consumer Reports paid, even with the tax break.

 

The story of the GM Volt deserves a place in the HarvardBusiness School curriculum, but of course, it won't. It is a classic tale of the GOVERNMENT deciding what the public needs, not the marketplace.

 

 

 

PS. Even the guy who sent this to me missed part of the point. What is one of the reasons for all of this?To keep the UAW in business! Because Obama owes them for his election.

 

Is it starting to make sense yet?

 

Plato said: "One of the penalties for refusing to participate in politics is that YOU end up being governed by your inferiors."

[Joe Marconi]

Great report, the truth revealed...