Posted on 02/05/2011 5:47:00 AM PST by Hojczyk
Automotive News piled on, suggesting that so far, Akerson's leadership has been defined by "hubris," panning reports that GM is planning to double Chevy Volt production from 60,000 to 120,000 units next year. Rechtin argues convincingly that even with the generous federal tax credit of $7,500, the Volt's steep $41,000 price will make it impossible to sell so many units. All this, despite the fact that the Volt - which Akerson touts as the "soul" of the new GM, isn't even making money for GM - since it costs upwards of $40,000 to build each car. Indeed, leave it to Government Motors to spend tens of billions of taxpayer dollars producing a product that doesn't make any money.
While criticism of Akerson may seem unfair - after all, he's only been at the helm for four months - the decision to hand the wheel to a politically-connected "finance guy" with zero manufacturing or auto experience is emblematic of GM's larger problem: Thanks to the huge $50 billion government bailout and $7,500 federal tax credits which effectively subsidize the cost of its hybrid-electric vehicles, Government Motors can afford to gamble again... with taxpayers money of course. That's the hazardous part of "moral hazard."
But should this really be any surprise? When the Feds become your company's largest single shareholder, the painstaking process of building cars, the engineering expertise and knowhow that's required, and the "sixth sense" that all good auto execs have in spades, all take a back seat to the political whims of Washington. It's no longer about what consumers want, it's about what Washington bureaucrats decide they need.
(Excerpt) Read more at realclearpolitics.com ...
The problem with socialism...
GM sold between 250 and 350 Chevy Volts in December 2010 and Nissan’s sales totaled less than 10 Leaf sedans in the past two weeks. Sales for the entire year were under 2000.
“It’s no longer about what consumers want, it’s about what Washington bureaucrats decide they need.”
This is back door cap and trade. The people didn’t want it, but they are going to try and ram it down our throats anyway. And we are paying for the privilege.
How much of “a loss” will GM be willing to make to sell these RubeGoldbergs..
Wow...going all in while holding a pair of "nothings". Sounds like a winning hand to me.
I just searched for Chevy Volt in google, and I think they are scrubbing their entries. I went through four pages of entries, and not one single derogatory, contrary entry. Not one.
I know they are a bunch of socialist, marxist statists over there, but it is as if they are shoving it in our faces.
That $7,500 subsidy won’t be around forever. I’m sure Obama promised them he would keep it but its a tax break and can be over turned.
Part of it is that as long as the government owns a piece of the action, they gotta pretend to do the government’s bidding. What will be interesting will be when the government is out completely. How sharp a right turn can they make?
You mean how much more loss, GM is financing anyone breathing to show sales, when the loans fail the fed will print them some more paper to hide the loss.
I understand on one 4WD model VW loses several millon dollars for every one sold.
At the end of the day, it doesn’t matter. I will not buy another GM product regardless of how good it might be. Not until they are completely privately owned again, and maybe not then either.
I am with you on this.
Rechtin argues convincingly that even with the generous federal tax credit of $7,500, the Volt’s steep $41,000 price will make it impossible to sell so many units.
Once Obamacar is established by the executive branch, it will be mandatory for every American to purchase one.
“I just searched for Chevy Volt in google, and I think they are scrubbing their entries. I went through four pages of entries, and not one single derogatory, contrary entry. Not one.”
The Chevy Volt is only sold in 5 states. Gotta read the fine print on the ad.
Here is the problem. Batteries operate a lot less efficiently in cold weather. Why would anyone north of Dallas consider buying one, especially at 41k?
If the volt was in full production and a hundred thousand of them were on the road this past week, hundreds of people would have been found dead in their little GM coffins, frozen solid due to battery failure.
If Obama keeps his illegal drlling moratorium in place, and does what he can to stop drilling everywhere, maybe have the EPA shut down soe Refineries, Voila, we have 5 $ a gallon Oil and 40,000 operating exspense for Gas Auto’s, thus bring the Volt into view as a cheap alternative.
Its all relative. I know $5 gas will FAIL as an Obama policy, The the Idealogue will still pursue it, and drive GM into the hole he’s living in.
Then, Barry thinks hes going to retool American railroads into hihg speed rail, the only thing stopping him is privately owned rail.....Amtrac leases Freight Rails, they don’t have their own, and we can’t afford to build new ones.
Barry’s health care is now unconstitutional, and El Presidente and his WH Admin are so corrupt, Congress is going to shred him and bring his Liberal crooks to court. I smeel Impeachment in the air, if Barry does not change his Chicago ways. But with Daly in the WH, fat chance.
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