General Motors (GM -0.4%) disputes a published estimate from Reuters claiming that the automaker...


General Motors (GM -0.4%) disputes a published estimate from Reuters claiming that the automaker loses $49K per Chevrolet Volt. At issue is if development costs of the program should be divided across the lifetime volume of Volts or the current number sold.

Comments (40)
  • Energysystems
    , contributor
    Comments (1839) | Send Message
     
    Lifetime volume is unknown at the time, what is known is current cost based on those sold so far.
    10 Sep 2012, 11:47 AM Reply Like
  • wjbrown2003030
    , contributor
    Comments (39) | Send Message
     
    Exactly.
    10 Sep 2012, 12:46 PM Reply Like
  • PostScience
    , contributor
    Comments (75) | Send Message
     
    GM is correct. R&D costs needs to be spread across the lifetime of the product. Otherwise, no R&D could ever be justified. It costs billions of dollars to develop a car. Does that mean that the first car off the line lost 1 billion dollars? Hardly.
    10 Sep 2012, 03:16 PM Reply Like
  • Energysystems
    , contributor
    Comments (1839) | Send Message
     
    GM CEO estimated 60K of sales in 2012, that was downgraded to estimates of 45K, and they're only on pace for 22K in 2012 sales. Lifetime of a product is unknown, do you happen to recall GM's EV1?
    10 Sep 2012, 03:23 PM Reply Like
  • Osterix
    , contributor
    Comments (498) | Send Message
     
    Energystystems: What about the Oldsmobile Diesel. It was supposed to revolutionize the automobile industry also. By now we were all supposed to be driving around in cheap, fuel efficient Diesel engine powered cars.

     

    Today the only Americans who drive Diesel engined cars are wealthy people who want to impress their friends, relatives and themselves. If you can afford a Mercedes Benz Diesel SUV do you really care how many miles to the gallon you get?
    10 Sep 2012, 10:20 PM Reply Like
  • Matthew Davis
    , contributor
    Comments (4709) | Send Message
     
    Presently they lose 49k per car, but it will be reduced over time if the car survives over a "lifetime" period, and by estimates this car won't last much longer. The government can only tell them to push a car no one wants for so long.
    10 Sep 2012, 11:46 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1917) | Send Message
     
    You do realize they also have the Cadillac ELR PHEV coming out in 2014 which using the same technology as the Volt, saw it at a car show 6 months ago and it was top 5 on green car reports, so you have to factor that in to the R&D costs.

     

    With the Reuters article I am reminded of the example my economics professor loved to cite for R&D costs and volume : The stealth bomber in the 80's, the R&D was so much when they ordered 1 is was so many billions of dollars, but when they ordered 3, the price was the same... Simply because all the R&D costs were spread out more evenly verses only one.
    11 Sep 2012, 05:25 AM Reply Like
  • GaltMachine
    , contributor
    Comments (1892) | Send Message
     
    "At issue is if development costs of the program should be divided across the lifetime volume of Volts"

     

    I thought that kind of accounting was illegal but apparently not if you are a government entity.

     

    What's the hypothetical number? 10 million? LOL.

     

    They dispute but don't clarify now that's a typical government reaction.
    10 Sep 2012, 11:58 AM Reply Like
  • wjbrown2003030
    , contributor
    Comments (39) | Send Message
     
    De-politicize the discussion, because you sound like an ideologue.

     

    Other than that ... I agree with you :)
    10 Sep 2012, 12:47 PM Reply Like
  • GaltMachine
    , contributor
    Comments (1892) | Send Message
     
    wjbrown,

     

    It became an inherently political conversation when the Government took over this car company, rewrote bankruptcy laws, screwed creditors, and rewarded the UAW so personally I can't separate the two.

     

    June 2, 2012 8:09 PM
    PRINT TEXT
    Electric vehicles fall drastically short of Obama's 1 million goal
    "(CBS News) WASHINGTON - The Obama administration invested $2.4 billion as part of its goal of putting one million electric vehicles on the road by the end of 2015. But that effort has, in part, stalled."
    10 Sep 2012, 01:08 PM Reply Like
  • NathanielPettit
    , contributor
    Comments (18) | Send Message
     
    I'm gonna get one soon
    10 Sep 2012, 02:46 PM Reply Like
  • Matthew Davis
    , contributor
    Comments (4709) | Send Message
     
    I hope it doesn't catch fire.
    10 Sep 2012, 11:45 PM Reply Like
  • warrenrial
    , contributor
    Comments (537) | Send Message
     
    I believe Reuters to be correct over the corrupt GM.
    10 Sep 2012, 12:00 PM Reply Like
  • youngman442002
    , contributor
    Comments (5123) | Send Message
     
    The Government will force you to buy one of these soon...that is central planning
    10 Sep 2012, 12:01 PM Reply Like
  • John Beagle
    , contributor
    Comments (17) | Send Message
     
    Too late, we already are buying them with our tax dollars. Except we don't get to drive them. We just get to look at them.
    10 Sep 2012, 02:42 PM Reply Like
  • NathanielPettit
    , contributor
    Comments (18) | Send Message
     
    you get to breathe that fresh carbon free air. Obama 12'!
    10 Sep 2012, 02:46 PM Reply Like
  • GaltMachine
    , contributor
    Comments (1892) | Send Message
     
    Nathaniel,

     

    "breathe that fresh carbon free air"

     

    I am not sure our plant-life would appreciate that!
    10 Sep 2012, 02:48 PM Reply Like
  • VictorHAustin
    , contributor
    Comments (824) | Send Message
     
    Volts burn coal.
    10 Sep 2012, 04:16 PM Reply Like
  • GaltMachine
    , contributor
    Comments (1892) | Send Message
     
    Victor,

     

    Apparently Volt buyers think electricity comes from that plug in the wall :)
    10 Sep 2012, 05:18 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1917) | Send Message
     
    Actually, Volts do not burn coal except in rare cases. Please familiarize yourself with the emissions the average US or state-by-state emissions. You'll notice that most recent grid data average US emissions is 1.2 lbs/kwhr.

     

    Coal, even the average coal plant emissions is 2.16 lbs per kwhr.

     

    If you are trying to cite marginal load, that is incorrect also since most of the marginal load is covered by mostly natural gas, which emits about 1 lb/kwhr.

     

    A normal car, in the US emits 0.85 lbs/mile, EVEN with coal in EV mode the volt emits, 0.56 lbs of CO2/mile, but that's not true since the average US emissions is less, so in real word tests it emits roughly 0.31 lbs/mile. To equal the Volt, you need to have a car get 64 mpg
    10 Sep 2012, 06:00 PM Reply Like
  • Energysystems
    , contributor
    Comments (1839) | Send Message
     
    Roughly 50% of the electricity supplied to our grid is generated from coal fired plants.
    10 Sep 2012, 06:06 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1917) | Send Message
     
    Nope, that's old 2006 data, Coal has been dropping significantly 42% is coal

     

    http://bit.ly/RFatsL

     

    42% is less than half, so you can only attribute 42% of the Volt's emissions to coal, would be the correct phrase. The average emissions are directly from the EPA. Less if you use marginal load since most of the occurs at night when coal plants are turned down.

     

    You really have to understand how electricity generation works
    Nuclear- very difficult to turn down- meant for "base" load
    Large Coal plants- moderate to turn down, ramped up and down to meet demand, these are meant to be turned down at night, coal is not quick.
    Hydro- Reserved to meet some daytime demand, but runs slower at night
    Solar and wind, can not be tweaked to meet demand, you get what you get and have to adjust others to meet the need, you can turn them off, but can not tweak them
    Natural gas/oil, etc- made to meet intermittent loads.

     

    If you follow the usage graph at night, you'll see that nighttime demand is 65% of peak demand, (4.1% wind, 19% nuclear, 4% hydro (night), remainder NG and coal, but coal is a lower percentage at night)
    10 Sep 2012, 07:37 PM Reply Like
  • Matthew Davis
    , contributor
    Comments (4709) | Send Message
     
    The point is, you don't seem to grasp...you have to burn something in order to generate electricity. Do you own a lighting harvesting farm?

     

    This is hilarious.
    10 Sep 2012, 11:45 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1917) | Send Message
     
    You also have to burn something to move a normal car too....
    The point is that the Volt in EV mode has lower emissions than a regular car, so you are emitting less than a comparable car and the myth that the Volt ONLY burns coal is just that, in rare cases, a person whom purchases a solar system and works nights emits very little if any CO2, or has a medium to small windmill and works days also emits very little CO2

     

    The Volt only burning coal is a myth... A myth cited by people whom do not have the first understanding of how the grid system works or even know keep current on scientific advancement and just take FIX news as gospel
    11 Sep 2012, 05:12 AM Reply Like
  • VictorHAustin
    , contributor
    Comments (824) | Send Message
     
    Thanks for the confirmation. A volt is not pollution-free; it is actually a small, short range, high mileage vehicle.

     

    I wouldn't consider EVs as adding marginal load. The sense in which the word marginal is used in discussing power generation is relative to fluctuations through the day. Adding a Volt to the load is relative to years of sustained average load. So really, it would be baseline load, wouldn't it? And around here anyway, peak loads are in the afternoon whereas at least a fair portion of EV charging will be overnight.

     

    The engineers should be congratulated, but they haven't saved the planet. EVs should be permitted to compete and not be pushed to the front of the line using dollars taken from all of us.

     

    The migration to natural gas for electricity generation is a great development, but even that merely reduces carbon load. For planet changing advance, we should be looking at Thorium nuclear, tidal pools, and on-site solar, in my opinion.

     

    BTW, very large wind turbines are proving to induce serious health hazards due to 24/7 low frequency noise, ceaseless flashing shadows. They also incur relatively small but ceaseless bird kills (including some species near threatened status), and outright collapse. They would appear to be appropriate only if sited some small number of miles from residences.

     

    And if your aesthetic sense of the environment includes vistas, only an open pit coal mine could really be worse than a wind farm.
    12 Sep 2012, 05:49 PM Reply Like
  • VictorHAustin
    , contributor
    Comments (824) | Send Message
     
    The comment we are answering claimed "fresh carbon free air."

     

    Get a volt, charge it with solar panels at home and a solar topped parking space at work, and a claim of carbon-free transportation could be made.

     

    But that's not what the hip, corporate-hating, self-congratulating young heavy resource guzzlers I encounter downtown seem to have in mind. They figure they are guiltless because they drive an EV or a hybrid or use a per-trip rental car.
    12 Sep 2012, 05:57 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1917) | Send Message
     
    In a perfect world, no tax credits, tax incentives or rebates should be given to anyone or anything unfortunately, that is not the world we live in.
    Currently oil companies get between 2 billion (conservative estimate) and 40 billion in tax breaks or incentives. If you are paying and an EV purchaser are paying 10 K in taxes, you are subsidizing less than 1/500th of a cent of your tax money to pay for the EV while the EV owner is paying $5 to pay for gasoline incentives/tax breaks/ etc. The EV owner in the scenario is on the losing end
    Windmills also have building ordinances, at least in NJ which state you can not have one without a certain area of land. Typically windmills are not located near large populations, except maybe the helix ones which do not have those issue cited. Here's some of the closest windmills to populations that I've seen and to get a scale, they are about a mile away

     

    http://bit.ly/PnjFCu
    13 Sep 2012, 04:50 PM Reply Like
  • Energysystems
    , contributor
    Comments (1839) | Send Message
     
    If you burn coal to charge a volt, your volt is burning coal. Not pixie dust.
    13 Sep 2012, 06:34 PM Reply Like
  • oerstead
    , contributor
    Comments (21) | Send Message
     
    You do not have to burn anything to make electricity. That is 19th century thinking.

     

    Consider -

     

    Hydro
    Wind
    Solar
    Nuclear Fission
    Geothermal

     

    California for example gets 42% of it's electricity without burning anything.
    3 Jan 2013, 02:06 PM Reply Like
  • Energysystems
    , contributor
    Comments (1839) | Send Message
     
    lol, look at the facts instead of making them up. "In the ongoing effort to codify the ambitious 33 percent by 2020 goal, SBX1-2 was signed by Governor Edmund G. Brown, Jr., in April 2011"

     

    That's straight from the Cali Energy Commissions website.
    3 Jan 2013, 03:06 PM Reply Like
  • oerstead
    , contributor
    Comments (21) | Send Message
     
    I used to manage product R&D. If you used the Reuters method nobody would ever develop a new technology. It's always done over the TECHNOLOGY life cycle, which generally includes multiple products. For GM this would be the Volt plus whatever other electric vehicles they market in the future.

     

    You can be they are planning on others. You don't invest in a whole new platform with just one product in mind.

     

    Reuters is being idiotic.
    10 Sep 2012, 12:41 PM Reply Like
  • wjbrown2003030
    , contributor
    Comments (39) | Send Message
     
    Well, maybe they are ... and you're certainly correct that you need to have a long-tail perspective for major new capital intensive investments, or no new R&D would ever be pursued, right?

     

    But Reuters was clearly putting a rosy flourish to their point ... at such low sales volumes, and with no major impetus on the horizon to change that, GM's VOLT program is a FINANCIAL LOSER.

     

    And, how do you count on "other electric vehicles" on this SPECIFIC "technology cycle"??! The technology will CHANGE, as it is oft to do -- especially in electric car category -- forcing GM to scrap its current tech.
    10 Sep 2012, 12:51 PM Reply Like
  • Osterix
    , contributor
    Comments (498) | Send Message
     
    oerstead: I repeat what I said previously. What is the TECHNOLOGY life cycle of the Volt type plug-in hybrid which is a unique technology. GM describes it as an "extended range electric vehicle" which is neither fish nor fowl.

     

    How did this work out with the Oldsmobile Diesel which had no follow-on models? R&D could only be spread over the limited number of Olds Diesels that were built before production was terminated. I predict that the Volt will cease being produced in a few years, if not sooner.

     

    No major mass production company can make a profit on an automobile that has an annual production of less than 40,000 units.
    10 Sep 2012, 10:32 PM Reply Like
  • oerstead
    , contributor
    Comments (21) | Send Message
     
    The Olds diesel was not a product of any R&D program. It was a short cut slap-dash conversion of a gas engine to get something on the market ASAP because of the oil embargo.

     

    There was basically no investment.

     

    And there were follow-on models. This turkey was used in the entire GM passenger line, and in light duty GM trucks.
    3 Jan 2013, 02:18 PM Reply Like
  • Energysystems
    , contributor
    Comments (1839) | Send Message
     
    Why did you lie about California's % of energy from alternative sources?
    3 Jan 2013, 03:07 PM Reply Like
  • deercreekvols
    , contributor
    Comments (8660) | Send Message
     
    GM can "dispute" the claim all they want. The Volt did not save GM nor did it change the industry.

     

    Other auto makers have to be shelving any ideas of producing the battery-powered beauties.

     

    Is it any wonder why Government Motors is listing in the water and heading for a second bankruptcy?
    10 Sep 2012, 09:02 PM Reply Like
  • Frankj78
    , contributor
    Comments (452) | Send Message
     
    Did the Volt qualify for the electric car federal tax credit?
    10 Sep 2012, 09:34 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1917) | Send Message
     
    Yes, the Volt qualified for the 7.5 K tax credit- how it did that as a PHEV is anyone's guess. Here's some tax credit info

     

    Pure EVs (cars)- $7,500 tax credit
    Volt and Fisker (about 30-40 mile plug in range)- $7,500 tax credit
    Ford Cmax energi (about a 20 mile plug in range) -$3,750
    Plug in Prius (about a 10 mile range)- $2,500

     

    If you go by a carbon abatement government cost per ton for pure EVs, and by extension the Volt and Fisker since they meet the "average daily commute" it is on the same magnitude, although a little more expensive, with the carbon abatement of air conditioner upgrades, at least in NJ it's $500, "rebates" that people typically receive.

     

    The Energi and PIP have CO2 abatement costs in the thousands of dollars, verses the others which are in the ($100-mid $200 range)
    11 Sep 2012, 08:25 AM Reply Like
  • billddrummer
    , contributor
    Comments (1748) | Send Message
     
    In 2008, the year before GM filed bankruptcy, the firm lost $37,000 a car for every vehicle they sold.

     

    Some things change, some things remain the same.

     

    Some things just get worse.
    10 Sep 2012, 10:08 PM Reply Like
  • youngman442002
    , contributor
    Comments (5123) | Send Message
     
    For the liberals who just HATE corporate subsidies....they sure like this one.....this will always be a "second" car for the owners...and they government will buy half of them...resale....we will see after 5 years how they hold up.....I doubt very well as the battery is very expensive and that will be the useful life of it
    11 Sep 2012, 08:33 AM Reply Like
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