Volt price cut

What happened is chevy lowered MSRP, instead of varying price with incentives. The old gm chevy strategy was to price things too high and discount them, to make people feel like they were getting a better deal (mark it up an extra $4000 and then give a $3,500 discount and make them feel like they are saving money). It doesn't work so well with internet information, and people just wait for the discounts. Its a good move. Nissan did it. Chevy has followed, ford and toyota should also lower their msrp instead of discounting.

I agree its not a real price drop, but it means the dealer is less likely to be able to rip you off. Part of the problem with selling plug-ins is the dealer network does not seem to be on board, other wise IMHO these cars would be selling faster.

The volt has been out less than 3 years. Costs of the batteries have gone down, the manufacturing has been tweaked to be more efficient, etc. To most of us 3 years doesn't seem like a long time, or an abandoned price point. It just takes time, and you should learn a little bit of patience. The prius phv hasn't even rolled out to 2 of the top 5 states for selling plug-ins. It seems you are quite patient about that. It didn't make much sense to sell the first years volts at a bigger loss now did it?

 

GM set a target price, didn't follow their own advice, and has been forced to where they wanted to be in the first place. Why a few people don't want to acknowledge that is a head scratcher. The excuses aren't helping. We know the needs of middle-market. We know the goal is achieve high-volume profitable sales. We know delay of several more years comes at a cost.

 

A year before the volt was produced I heard the price of $40K, they came in around that.

Are you talking about trade show pr? That's a little crazy even for you. They said they would like to get it bellow $30K. I guess they could have delayed the thing until 2013 when battery costs might come down, but without putting it out there, would the costs really have fallen?

Again for the umpteenth time, the volt is an initial adopter car, it is not a high volume vehicle. Initial adopters rules work quite differently than you seem to understand. Is that clear, or will you have this same fruitless opinion 10 years from now when the next wave of innovation hits.

I don't offer any excuses for gm. I don't work for them. I do offer explanations of the car market, which you seem oblivious about. Why do you talk about excuses when the price of the car has against your um constant muttering come down in price? It was in less than 3 years. Now what is your excuse again?

Yes gm could have initially put the car out at this price. They likely would have lost money on every one sold versus their actual pricing strategy. I don't understand what they lost by not doing this. It still would have been a political punching bag maybe more so. Do you now like the volt because it is priced more like you thought it should be? It isn't going to sell 5000/month in the US, the pricing isn't magic, it is still an initial adopters car. It will likely sell over the 30,000 it did world wide last year, but not by a great amount. That will take a second generation car.

 

New Volt Price Official | PriusChat
The thread on this in the Volt subforum. We could use it for non Volt v. PPI discussions on the topic.

 

Forbes take
Will Chevy's $5,000 Price Cut Charge Up Volt Sales? - Forbes

Which is pretty much what dipper said.

Doh. Akerson doesn't seem to have as much foot in mouth disease as Lutz, but this slip likely did cost gm sales.

In a competitive market you are forced to pass those savings on

 

Conveniently forgetting the plans for 60,000 in year #2 with the production-capacity of up to 120,000 by year #3 is flat out denial of the intent GM had with this generation.

 

Wow John, way to listen to markabele and be nicer and less accusatory.

As I have mentioned on more than one occastion, I do not work for GM. I also do not have any inside information on their intent. I haven't even owned a gm car, although I have borrowed them and been given them as rentals. I do have some more insight on bmw having consulted to them, and insight to ford through my father's dealings with them. We all can read and think.

What I do know is these are initial adopters cars and gm to the best of my knowledge has never said otherwise. You pointed out some quotes in 2011, that IIRC both of us thought were unrealistic then. I really think with my vision then as now these things were and are unrealistic. they are optimistic projections. Toyota also projected 60,000 world wide sales like GM with its phv, and fell shorter than gm. I will repeat again these are initial adopters car. That is IMHO. You seem to think they aren't but the sales say otherwise. Dropping the price a great deal would likely help sell the phv more than the volt, as then the phv would undercut the price of the liftback. I don't see a business case for that.

So you see, never support from me on these being mass market cars in the first generation. I didn't put out the stupid press releases over estimating sales, and I agree they were stupid, but how can you accuse me of denial of intent. I never said I knew GMs intent. If it was as you say to hit a home run in the first generation, numerous other corporate communications refute that. I will though say, I really don't know their intent. I do know the actual product and pricing are good today, and agree with analysts at publications like Forbes and business week that it will not greatly increase sales, these will be small increases. Nissan was the most overly optimistic of their sales, BMW appears to be setting expectations very low on the i3.

Here is some of the information right before the volt launch.
Executive coverage -- Automotive News

Note in october 2010, they increased from the 30,000 volt projection for 2012, to 45,000. They would have been right on if they had left it where it was, as they sold just over 30,000 volts and amperas. Really stupid then saying they might hit 60,000, but that was for a very short period in 2011. Reality set in. I see 3 sets of expectations being set. There is some foot in mouth disease, but the biggest were raising expectations, of sales and price cuts.

 

Good post...I think you are correct this is new info...

I heard this reported on WTOP (Wash DC) news radio this morning with this added "kicker": GM says those willing to wait for 2015 model will get an additional $2500-$500o off (new 2015 model to be cheaper yet- if I got my model years correct).

Implications? Many I am thinking. The Federal $7500 rebate starts to sound excessive if the cost of the cars gets down too low. If the Li batts are getting so cheap, then Prius hybrid needs to switch to Li and maybe have plug-in standard (which was the rumor at one point).

PS- Why couldn't Toyota keep the general Gen2/Gen3 design and put and Li batt in the current NiMH batt slot and this allows some plug-in (few miles at speed) and better MPG?

 

GM cuts plug-in Volt's price by $5,000 | The Detroit News
Strange stuff here

I didn't expect the lease rate to go up. The pricing indicates gm wants to shift from leases to purchases. Expected residual value must be going down more than the price cut. That may actually make sales go down a little instead of up.

 

You expressed the desire to not have to ever "again" again. Addressing it directly is an effort to achieve that. Give me credit for trying to end it.

You keep telling us Volt is an "initial adopter" vehicle. Either you know GM information or you don't. Which is it?

Now, step back...

Consider that no matter what the PRICE is, the problem of COST continues to be an issue. GM gambled heavily that battery technology would advance further & faster than it actually did. So, they need to figure out what the next step is.

Now, ask about...

What happens between now and the rollout of the next generation?

.

That older PSD setup without the gear-reduction wouldn't be effective... which is why Gen3 got the upgrade.

Gen3 with a small Li batt wouldn't overcome the cost/benefit threshold. Toyota worked really hard trying to figure out what the smallest possible capacity they could deliver that would be profitable and deliver a substantial efficiency gain.

Think about how cheap 4.4 kWh could be by the time the next generation is rolled out. Cost could be low enough to take on traditional vehicles head on.

 

John. So Toyota is ALSO a failure then. Remember how Toyota Marketing promised their FT-86 as an under $20k car? Oh, it became a $25k car.

So using Hills' logic, we should never trust Toyota too (as much as GM). So don't believe anything Toyota says about the next Prius then...

 

If it walks like a duck and quacks like a duck, its a duck. The car looks like an adopter car, and sells like an adopter car, but most of all its the demographics of an initial adopters car, its an initial adopter car. If GM intended it as something different, then it failed. I again, don't have inside information on this. The demographics are quite different than the cruze or malibu. I know they talked about it being a green halo car, and that would be an initial adopter car too.

New Chevy Volts to Cost $5,000 Less - WSJ.com

If we believe the WSJ and Akerson, then costs have indeed dropped. Do you have information that they have not dropped? Now if these cost drops would sell the volt on its own, it would be hugely successful, but simply cutting costs is not enough.

Now sometimes you need something special

I would call tesla's something special, even though the sales volume is lower than the volt (US+Europe, or either alone). Its not about selling the most cars. Tesla is though selling more model S than any competitive model.

From the WSJ

Then again

Which they fail to mention is up a great deal compared to last year (yoy sales of the first 7 months are up over 100%.

Which leads us to what happens until the next generation has a lot to do with gas prices and competition. I expect gm will continue to cut costs, and the car will continue to appeal to initial adopters. WSJ is quite negative when it comes to the plug-in market. More positive is Forbes
Will Chevy's $5,000 Price Cut Charge Up Volt Sales? - Forbes

And again, you need to ask GM if you don't like these answers.

 

GM hasn'tpaid the Fed's back for all the stock they ate. And now? Why should they. They're simply giving away our tax dollars. sucks to be us.

Don't be dragging my good name into it

Both toyota & GM get backed by their governments. If toyota screwed up on the FT-86 (which I know nothing about) then I look at that (or on GM stories) on an ad hoc basis. Calling it "kindly" ... which company says the most "incorrect" stuff ... over the most decades.

.

 

Earlier this year, Akerson himself told us each Volt was being sold at a loss. Now, just a few months later, we are suppose to believe it's possible that production-cost could have been reduced by over $5,000. Wow! That's amazing!!!

 

Ahh yes, sort of in my price range with the incentive The volt is nice...except it's hard to deal without the 3rd seater in the back seat and what, maybe only 350 or so straight miles (without fuelling up and fully charged)?

But the price is AWESOME compared to the PIP, now what Toyota?

 

From a quote above, GM initially kept the Volt volume low and basically hand built and super tested each car until they learned how to build them on a routine mass-produced basis with the right quality which is how the cost to build dropped. Even if the parts costs stayed the same, the supervision and labor and QC costs dropped and so price to the consumer could drop while still providing some margin.

 

can you post something from gm 2013 that says a loss on a variable cost basis.

We know that gm said that the time of introduction, paying back R&D would not be profitable until second generation.

Everything I have read is the volt clears variable costs but does not pay back enough fixed. Fixed costs are sunk investments. If you cancel the line it is likely they are lost. I would be very surprised if WSJ knew costs had not dropped, but published multiple stories of them dropping anyway. Again what do you think it costs to build today?

 

Continue being the #1 selling plug-in hybrid? <shruggs>

 

Link please....