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GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2012

7.6K views 63 replies 36 participants last post by  zete  
#1 ·
GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2012

Detroit News

December 17, 2011

GM CEO Dan Akerson touts Volt plans

Interesting quote from the article:


GM CEO Dan Akerson speaking to a Detroit News reporter:

"By this summer we will (be in) what I call the second generation, where we will achieve certain scale and we should see an appreciable drop in the cost of the production of the Volt."
 
#3 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

So you mean all of GM's outlandish prices for trucks will drop too?
 
#4 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

So it is best to wait until late in the summer in order to get a good deal on a Volt? I wonder if GM will pass the cost savings along to the customer?
 
#5 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

So it is best to wait until late in the summer in order to get a good deal on a Volt? I wonder if GM will pass the cost savings along to the customer?
Doubt it, but could happen, althoug I think that the statement was for Shareholders and Wallstreet Media.

The idea of costs being more favorable allows the customer the confidence that the vehicle itself will be profitable enuff to continue on. This is huge, and could signal another price reduction for the BK paid for Volt (As the Volt R&D costs should have been included in the Chapt 11)
 
#7 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

I think roughly half — are either Prius or BMW owners
Anecdotally I can agree with this. My company's Senior VP of Corporate Planning just traded in his Prius for a Volt, and his second car is a BMW convertible. I was talking with him about it at our last board meeting, he is totally in love with his Volt, he was wait listed 4 months to get it. He said, "It makes my Prius look and drive like a slow, fugly, POS dinosaur"... He then went on to talk about the low center of gravity, how it handles, drives and "feels"... He talked about the quality of the construction, the leather interior, etc. The second that the two of us can find some mutual free time, I'm going to take it for a drive. We have some very nice tin in the senior managers parking lot, but the Volt generated all kinds of excitement when it arrived a little over a week ago.

He is also a right of center kinda guy, he is a retired "full bird" colonel.
 
#9 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

Anecdotally I can agree with this. My company's Senior VP of Corporate Planning just traded in his Prius for a Volt, and his second car is a BMW convertible. I was talking with him about it at our last board meeting, he is totally in love with his Volt, he was wait listed 4 months to get it. He said, "It makes my Prius look and drive like a slow, fugly, POS dinosaur"... He then went on to talk about the low center of gravity, how it handles, drives and "feels"... He talked about the quality of the construction, the leather interior, etc. The second that the two of us can find some mutual free time, I'm going to take it for a drive. We have some very nice tin in the senior managers parking lot, but the Volt generated all kinds of excitement when it arrived a little over a week ago.

He is also a right of center kinda guy, he is a retired "full bird" colonel.
Here's a man that tells it like it is.
 
#13 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

I just wish GM's PR guys would put a muzzle on Lt. Dan. This all may be true, but what is wrong with reaping the resulting profits from this kind of thing BEFORE the CEO crows about it. There is nothing good about this pronouncement at this time. It gives competitors something to aim at if it's true, and if not, then GM gets blasted for "all talk and no action". How about quietly achieving excellence and then speaking of it later? Seriously. He should just go on holiday for a while.
 
#14 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

I just wish GM's PR guys would put a muzzle on Lt. Dan. This all may be true, but what is wrong with reaping the resulting profits from this kind of thing BEFORE the CEO crows about it. There is nothing good about this pronouncement at this time. It gives competitors something to aim at if it's true, and if not, then GM gets blasted for "all talk and no action". How about quietly achieving excellence and then speaking of it later? Seriously. He should just go on holiday for a while.
Damned if he does and damned if he doesnt. People are dying to have him comment on the Impala, next gen trucks and a zeta sedan. Yet, when he does say something that gives a little glimmer that they are accomplishing their goals, he gets blasted.
 
#16 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

Good get that price down, so that it can be my next car. I will bw patient and wait. If it takes 10 yrs then I will wait for my next auto purchase. For me afordable would be GM cash off, incentives and O% for 5yr or less and no more than 15k financed. Then we have a deal.
 
#17 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

The Volt is efficient, technologically sophisticated, and for better or worse its politically correct.

But you know what it isn't? A sad appliance. The darn thing is actually enjoyable in routine motoring. I hope GM can turn a profit on this car someday.
 
#19 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

I enjoyed each of the various times I drove the volt. Its a nice driving vehicle and I hear Jay Leno has a lead in miles driven without gasoline....something like 11k ?? or 11 months ??

for many americans who literally drive for the most part...under 40miles a day....(78 % of americans according to GM) the volt is an amazing value..

funny as my wife just yesterday brought me the new paper as it had an ad in it for the fisker karma dealership opening up and she mentioned how beautiful the Fisker looked in the photos..

As tempting as it might be...its over 100 grand and not nearly as sophiticated (SP) as the volt or the upcoming Cadillac ELR...

Now thats one to keep an eye out for...IMO Lowering the price of the volt or the cost of production.....is important...but offering up a cadillac model might just with the right styling really break the voltec technology wide open in america...
 
#23 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

The Truely magic number For Volt in the Public's eyes will be $29-35K Before Tax rebate. If GM can get the Base price down to or below this range Volt will really take off in Sales. I must Say however that the $40K Volt price now does not seem as expensive as it did 2 years ago, especially when compared to other electrics that are coming out now. It really makes me curious what GM will Do with ELR when it's ready.

Anyone want to venture a guess at what the Cadillac ELR Base Price will be?
My guess - $55,000
 
#24 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

The Truely magic number For Volt in the Public's eyes will be $29-35K Before Tax rebate. If GM can get the Base price down to or below this range Volt will really take off in Sales. I must Say however that the $40K Volt price now does not seem as expensive as it did 2 years ago, especially when compared to other electrics that are coming out now. It really makes me curious what GM will Do with ELR when it's ready.

Anyone want to venture a guess at what the Cadillac ELR Base Price will be?
My guess - $55,000
$80,000-$100,00
 
#25 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

Anecdotally I can agree with this. My company's Senior VP of Corporate Planning just traded in his Prius for a Volt, and his second car is a BMW convertible. I was talking with him about it at our last board meeting, he is totally in love with his Volt, he was wait listed 4 months to get it. He said, "It makes my Prius look and drive like a slow, fugly, POS dinosaur"... He then went on to talk about the low center of gravity, how it handles, drives and "feels"... He talked about the quality of the construction, the leather interior, etc. The second that the two of us can find some mutual free time, I'm going to take it for a drive. We have some very nice tin in the senior managers parking lot, but the Volt generated all kinds of excitement when it arrived a little over a week ago.

He is also a right of center kinda guy, he is a retired "full bird" colonel.
There's a guy who lives 2 blocks down from me that has a Volt too. He also owns a new Mercedes Benz GL550, a 2012 Silverado HD, a BMW 525d and a ZR1 (what year I don't know but it's a C6 like mine). GM doesn't know Chevrolet's customers very well..
 
#27 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

When people hear the CEO say there will be an appreciable drop in cost, they expect it to be reflected in the selling price of the car. They will not buy now and wait until the price drops. If the price doesn't drop, they will not buy and will be mad at GM for misleading them. Wasn't a smart statement.
 
#28 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

Every time people bring up GM's stock price I need to remember to post Ford's, the darlings of the Detroit 3. $10.25 as of closing today. Off a 52 wk high of $18.97.

Yup, its just GM that is having a rocky time in the stock market.

It IS a smart statement. The $7500 tax credit gets reduced next year more than likely. There is even a chance it goes away if Congress cant get its act together in time. What happens then?

All in all, the car will probably cost the exact same when they get the costs down. He merely stated that they were on target to get the price down. How is that a bad thing? Again, damned if you do, damned if you dont.
 
#32 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

Every time people bring up GM's stock price I need to remember to post Ford's, the darlings of the Detroit 3. $10.25 as of closing today. Off a 52 wk high of $18.97.

Yup, its just GM that is having a rocky time in the stock market.

It IS a smart statement. The $7500 tax credit gets reduced next year more than likely. There is even a chance it goes away if Congress cant get its act together in time. What happens then?

All in all, the car will probably cost the exact same when they get the costs down. He merely stated that they were on target to get the price down. How is that a bad thing? Again, damned if you do, damned if you dont.

You make some really good points, however:

Ford went from $19 to $10, after it was down to $1.50, GM went from $39 to $19 after it started at $33, and who is suggesting following Ford down the rat-hole of disparity is good for GM? Ford is down becasue they don't have the Volt, GM is down because they do?

Its very unlikely the price saving will be reflected in lower MSRP's, it will help the car become viable.

Today when GM sells a Volt and loses money, lets say its $8,000 but then consider, had they instead sold the customer a Malibu that they would have made say $4,000. Instead of an $8,000 loss, GM's loss is really $12,000.

If the tax credit gets whacked, WOW - I don't know, all bets are off, but IMHO no way it happens before 2013.

"Again, damned if you do, damned if you dont."

I think we are in 100% agreement there, face it the guys got a severe case of hoof-in-mouth disease, put a microphone in his face, ask him some questions, he starts spewing all kinds of stuff, most of which gets him in trouble.
 
#33 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

This is step one in polishing a turd; GM needs to move the goalpost. Demand has been tepid and GM has a stated goal of 60,000 sales in 12. They probably won't make that based on this year's luke warm sales, so they will adjust the price to make the sales target and eat the loss so as to make the car look like its hitting its aforementioned goals. At this stage the Volt is mostly a marketing exercise, and a worthwhile one. If the public narrative around the car becomes that of a failure, then GM has an EV1 all over.
 
#36 · (Edited)
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

This is step one in polishing a turd; GM needs to move the goalpost. Demand has been tepid and GM has a stated goal of 60,000 sales in 12. They probably won't make that based on this year's luke warm sales, so they will adjust the price to make the sales target and eat the loss so as to make the car look like its hitting its aforementioned goals. At this stage the Volt is mostly a marketing exercise, and a worthwhile one. If the public narrative around the car becomes that of a failure, then GM has an EV1 all over.

Luke warm sales!!??? are we talking about the same car? This car has been wait listed at most dealers for 4-5 MONTHS... It has about the same amount of demand as the first year of the new Camaro... It has one of the shortest "in-stock times" of any car that GM makes. The difference has been GM's decision to slow roll the car.... you know to ensure that the car only gets good press and that we can manage any technical problems (that total failure aside) this car has been a HUGE hit, in spite of Faux News and other (so called) right wing blowhards attempting to paint it as some sort of free enterprise affront. Need more proof, the XLR when it was cancelled had a 30 month inventory, the Corvette currently has about a 3 month inventory in the supply chain, the Volt has a 3 week supply. If you are going to recommend killing every car that GM makes that has a longer inventory supply than the Volt, you won't be left with much to sell.
 
#37 · (Edited)
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

I agree with your boss, 2002. I am a RWD-, V8-, twisty road loving-nut. But I loved my all-too-brief drive of the Volt. It is one of the few things I've experienced in the last couple of years that truly lives up to all expectations - and then some.

I love my 2004 car, but after the Volt it does indeed feel like something from last century: something good, but last century. The Volt is just so 'next year', but supremely competent, and surprisingly fun to drive - that's the real wonder of it.

I don't think they'll drop the price. They'll take less of a hit on every one - like Toyota is on the Prius. And still keep selling the profitable cars like Sonics, Cruzes, Malibus off the back of it.

GM needs to keep the constant updates, maybe consider a more-entry-level 'Volt-lite' with less range at lower MSRP.

But I think they nailed the full potential market with Volt. It's pretty much right where it should be, and that is shown by the large variety of people who get it.
 
#38 · (Edited)
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

I agree with your boss, 2002.
For the record, he is not my boss, he is my peer. He and I both report to the CEO. ;)
 
#46 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

I just want to see the Converj come to fruition.

Yeah, that's more $$ going towards developing the production version, as well a tooling, but that's peanuts compared to how much went towards powertrain and platform development.

A nicer interior and that sexy sheetmetal will attract a good amount of buyers who don't nearly an issue with the initial costs of the Volt-infrastructure - and would be a bit of a halo vehicle for Cadillac.
 
#56 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

I thought the dealers were clear to release/sell the DEMO's?

A lot of the "noise" will go away when the sales go up.

We've been expecting sales number much higher than we've been seeing, for months, each month disappointment and the search for reason.......

For arguments sake Zete, lets say the inventory is all fresh, and while the dealer still has X number of units in stock, its not the same 2, 3, 5 Volt's that were sitting there the month before. Would we not see this in the monthly sales number?

GM's been making north of 500/week (2,200/month) since mid-July, 23 weeks ago, yet the 3 months average isn't even 1,000.

Is it unfair to say a December sales number less than 2,000 would be disappointing?
 
#60 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

I thought the dealers were clear to release/sell the DEMO's?
:
Is it unfair to say a December sales number less than 2,000 would be disappointing?
Yes, they can sell their demos but I doubt many will. A lot of people won't place an order if they can't drive a demo model first. So, if you sell and your competition doesn't, you're putting yourself at a serious disadvantage. Thus, for the 25 dealers in and around John you can eliminate 25 cars right there.

A quick look today shows a new car at Bloomington while Anoka and Rogers have taken one off their lists, each.

And, yes, sales numbers should be around 2000 considering how many they're building. Unless the NHTSA has gone and crashed 3000 of them to get the battery to fail ;).
 
#59 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

Dealers almost always list presold vehicles as inventory, because it is inventory until the ink is dry on the purchase agreement. Please would those of you who can barely understand kwh vs fuel consumption quit trying to overreach into areas you have even less of a clue about?
 
#63 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

AP Source: GM to call back 8,000 Chevy Volts:

DETROIT (AP) — A person briefed on the matter says General Motors will ask Volt owners to bring their electric cars into dealers to strengthen the structure around the batteries.

http://news.yahoo.com/ap-source-gm-call-back-8-000-chevy-160059632.html
 
#64 ·
Re: GM CEO Speaks of an "appreciable drop in the cost" of producing the Volt by mid 2

AP Source: GM to call back 8,000 Chevy Volts:

DETROIT (AP) — A person briefed on the matter says General Motors will ask Volt owners to bring their electric cars into dealers to strengthen the structure around the batteries.

http://news.yahoo.com/ap-source-gm-call-back-8-000-chevy-160059632.html
A vast majority of people are, well, stupid. To deal with this fact GM (and other manufacturers of electric cars) will have to over react to each and every instance of any problem, regardless of how unlikely. If the same type of idiotic response from the media was applied to regular cars we'd see hundreds of millions of recalls to deal with the potential of real fiery death after a car accident, as opposed to the potential of the car's battery catching fires weeks after an accident while stored in some junk yard.

People have gotten so stupid it's frustrating to even hold discussions with many today. The lack of reason and logic is unbelievable and gets worse every single year. As my son points out, it's as if they go home and punch themselves repeatedly in the head to make themselves dumber and dumber all the time.