GM again suspends production of Chevy Volt

Last year GM sold 7,671 Volts.  This year they seem on track to double sales.  But less than 20,000 units is pretty small, especially compared to the huge subsidies provided by the government.  Auto News has this:
General Motors plans to idle the plant where it assembles the Chevrolet Volt plug-in hybrid for four weeks starting next month, two people familiar with the plans said. 
GM will close its Detroit-Hamtramck plant from Sept. 17 until Oct. 15, one of the sources said. Union representatives last week told the plant's roughly 1,500 workers about the scheduled downtime, the source said. . . . 
It's the second time this year that GM has throttled back on Volt production. The Detroit-Hamtramck plant was idled from March 19 until April 16 amid swollen Volt inventories.
Volt demand has picked up this year, after sales last year fell short of GM's goals. GM sold 10,666 Volts through July, more than triple the 2,870 sold during the same period a year earlier. . . .  
Volt inventories have been whittled down, too, to 6,500 units, or 84 days' worth, as of Aug. 1. On March 1, just before the last production shutdown, GM had 154 days' worth. . . . 
UPDATE: But, as the commenter below notes, much of the Volt's sales are due to purchases from GE for its employees.
GE began purchasing Volts for its employees last month [March] in what it called "the largest order in history" of cars for its employees. However, the Volt numbers reflect a slow start to the GE Volt order. GE plans to buy 12,000 Volts by 2015. In effect, GE could buy 500 Volts each month in 2013 and 2014 and meet that target, without buying any Volt fleet vehicles this year. GE did say all fleet vehicle replacements in 2012 will be made with Volts, but it seems as if that could be a minor part of the Volt story if it is successful this year. 
The GE buying of Volts will continue to be a swing factor in month-to-month sales figures for the Volt, but the March data shows consumer demand for the vehicle is increasing at a critical time for GM, critical because of the excess supply. 
There have been more than 18,000 Volts produced and roughly half had been sold through February, a situation that led to the production halt and a more recent statement from GM that the production shutdown could be extended by a week. 
Analysts have also pointed to sales of the Nissan Leaf, down 29% for the past two consecutive months, as a sign that all is not well among U.S. consumers when it comes to the electric car market. 
However, the "inorganic source of demand," from GE and the trend in Leaf sales didn't reflect what was simply a good month for the Volt in March, once GM broke out the retail vs. fleet numbers on a conference call with analysts and the media. . . . . 
In addition, the Federal government has been making large purchases of GM cars, presumably also including the Volt.  This also brings into question how well the GM bailout has been going.  Here is a discussion from January this year.
Speaking of suspicious activity, an interesting statistic was revealed on GM's sales conference call. Government purchases of GM vehicles rose 32% from last year. This represents yet another conflict as the Obama Administration has a vested interest in GM's success as it spends more taxpayer dollars to help support the company as 2012 elections near. . . . 
GM sales spokesman, Jim Cain, government sales reportedly make up 5% of total sales and most of those sales are to state and local governments.  But 2% of 248,750 is still 4,975 units.  If even 10% of those sales are for Volts, the government may account for virtually all the remaining sales.

UPDATE: Military making big purchases of Volt.
The Pentagon is buying Chevrolet Volts to help “green up” the military—while propping up sales of the bailed-out automaker’s most politicized car. 
The Department of Defense began purchasing the struggling luxury electric car, which retails at $40,000, this summer as part of its goal to purchase 1,500 such green vehicles. The Marine Corps Air Station in Miramar, Calif. purchased its first two Volts in July, and 18 more vehicles will come shortly to Joint Base Andrews in Maryland, where Air Force One is based, according to military magazine Stars and Stripes. . . . 
GM is now offering the vehicle for as low as $169 per month, a financing deal that is generally reserved for $15,000 cars—a price so low that GM is reportedly losing nearly $50,000 per vehicle. The struggling automaker will again suspend production later this month after only 2,500 Volts drove off the lots last month. . . .
UPDATE: Advertising for GM's Volt in Europe banned as misleading.
. . . Now the commercial has been banned for misleading motorists who want to do their bit for the environment.The advertising watchdog’s ruling is a blow to Vauxhall’s Ampera, which beat the Range Rover Evoque to win the European Car of the Year award for 2012.Vauxhall insisted its claims about the Ampera were genuine and that once in ‘range extender mode’, it can indeed keep going for 360 miles. . . .

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Blogger Michael Tallitsch said...

A little birdie told me that General Electric is replacing their company cars this year with all Chevy Volts. That has to account for several thousand Volts.

Is it any coincidence that GE's CEO is an ardent Obama supporter and the company is also a government contractor?

As a side note, I wonder how many Volt's were purchased directly by the US Government?

8/28/2012 1:58 PM  

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