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GM plans to build a more affordable Chevy Volt

The Volt has won nearly every major award offered and stirred up tons of interest, but one criticism persists: The price is way too high.

Chevy cars — including the Volt — have always been intended for a mainstream market, but at $41,000, it seems GM is asking buyers to pay as they might for a Mercedes-Benz or BMW.

The next-generation Volt will almost certainly cost less, GM spokesman Rob Peterson said. And the same changes that make it cheaper should make it better, too.

So what’s the sweet spot for the Volt, price wise? A $7,500 federal tax credit takes the cost down to around $30,000. That seems like a more viable price, but tax credits wont last forever.

“The ideal price point for un-subsidized large-volume sales would probably be no more than $30,000,” said John O’Dell, editor of the Web site GreenCarAdvisor.com.

Fortunately, even when subsidies disappear, today’s high prices for electric cars will ease as the technology improves and gains wider appeal.
0:00 /2:11GM CEO on plans for Volt technology

Battery: The Volt’s battery pack is estimated to cost about $10,000. Besides making it more cheaply, GM might simply want to shrink it.

The battery is probably more powerful than it really needs to be, said Oliver Hazimeh, head of the electric vehicle practice at consulting firm PRTM.

“Offering customers a little of different capacity may be an option, so you can provide customers with a choice,” Hazimeh said.

For a significant cost savings, some customers may be willing to give-up some battery power.

Bulk up production: Another way to reduce battery costs is to sell more Volts, or more vehicles based on Volt technology, Hazimeh said.

“It’s hard to look at this technology and make a business case out of it with one vehicle,” Hazimeh said.

Continue reading GM plans to build a more affordable Chevy Volt

Toyota Motor Corp. / Ford Motor Co. rose more than 40 percent in March

Custom Ford Fusion

General Motors Co. posted a 21 percent increase in March U.S. sales while Toyota Motor Corp. and Ford Motor Co. rose more than 40 percent as higher incentives industrywide helped lure buyers to showrooms.

Ford, which advanced for the sixth straight month, was outsold by Toyota and GM in March after leading the industry in February. Toyota’s 41 percent gain was aided by richer incentives aimed at luring buyers after its recall crisis.

“Retail sales were really artificially inflated by huge incentives going on in the marketplace and did not reflect true demand,” said Jessica Caldwell, director of industry analysis at Edmunds.com. “April will be a good indicator of real consumer demand.”

Overall U.S. sales rose 24 percent from the depressed levels of March 2009, when automakers were battling the weakest demand in almost three decades. The seasonally adjusted annual sales rate of 11.7 million was the year’s highest and the second strongest since August, when the U.S. cash-for-clunkers campaign lifted demand

Hundreds of GM dealers could get their stores back

General Motors

General Motors

General Motors is preparing to provide some of its dealers with rejected franchises an opportunity to reinstate their stores, and the Detroit automaker plans to provide details during a Webcast today at 2 p.m. Last year, GM sought to wind down about 2,000 dealerships as part of its government-backed bankruptcy restructuring. A person close to the situation said today that GM plans to send a letter of intent to several hundred dealers who were identified to have their franchises pulled.

The letter will provide the dealers with instructions on how to apply for reinstatement, but those dealers must meet a number of qualifications, such as having adequate capital to operate and available financing, the person said. “What’s the criteria? That’s the million-dollar question,” said Tammy Darvish, a dealer who has been involved in negotiations with GM in an effort to win reinstatement for a group of 1,160 dealers who are protesting GM’s decision to shut them down.

GM’s criteria for reinstating dealers, Darvish said, “was always the hang-up” during negotiations between the protesting dealers and GM. Darvish, vice president of Darcars Automotive Group in Silver Spring, Md., said she expects that a large percentage of the dealers who will be offered reinstatement will be Cadillac dealers.
Darcars Automotive Group has one Chevrolet dealership affected by GM’s initial plan. In February, Mark Reuss, GM’s North America president, told journalists gathered at the National Automobile Dealers Association convention in Orlando that the automaker hopes to settle as many of the disputes as possible outside of arbitration.

GM ended 2009 with about 5,700 dealers, which includes dealerships that GM is trying to wind down or that are slated to lose a brand.

General Motors Plans to Reinstate Nearly