How Much Money Did Gm Spend On Volt
NEWS
Report: GM Loses Most $50,000 on Every Volt
A report from Reuters on Monday alleges that GM loses as much as $49,000 on every Chevrolet Volt information technology sells as the automaker looks to spread development costs over just 21,494 Volt sales in the 21 months since the plug-in hybrid car hit dealerships.
GM acknowledged it likely won't brand money on the $39,145 Volt until the second generation shows up former mid-decade, simply the automaker called Reuters' figures "grossly wrong."
How does the math work out? Citing estimates from consultants who worked with GM, Reuters said information technology toll some $i.2 billion to develop the Volt, including research and development and the requisite factory tooling but not marketing and sales costs. Each Volt then costs around $20,000 to $32,000 to build, including materials, labor and factory operations. Compare that with the $12,000 to $xv,000 information technology costs GM to build a Chevrolet Cruze, whose platform the Volt shares.
The cost per vehicle will go down as GM spreads development costs over more sales. Reuters, still, pointed to the wider problem of market acceptance for plug-in cars. Indeed, last month the Nissan Leafage, Mitsubishi i-MiEV, Ford Focus Electrical and Honda Fit EV combined for just 900 sales. Past contrast, GM sold 2,831 Volts, simply a lot of that came through discounted leasing, Reuters said. With monthly payments as depression as $199, the automaker pushed its losses fifty-fifty higher.
GM countered that the Volt represents a "big dip in the technology pool," and the automaker volition spread development costs to future models like the Cadillac ELR. Last twelvemonth GM said the Volt spurs Cruze sales. It also continues to improve GM's environmental paradigm, despite beingness politicized. After all, Toyota spent a reported $10 billion to develop the Prius and its variants through the years; the investment has paid off many times over. The Prius is now assisting, with a light-green image that overshadows Toyota's xv-mpg Sequoia SUVs and Tundra pickups.
For GM, the concluding tally will depend on just how many Volts — and the rebadged Opel Amperas overseas — the automaker sells in the current generation, as well as how much of today's evolution costs can deport over to the next-gen Volt. Through August, GM has built some 20,815 Volts and Amperas, according to Automotive News, with roughly ii Volts coming off the assembly line for every Ampera. Calibration that out to annual production for five years — provided GM can sell all those cars — and the automaker could sell more than than 150,000 over a five-twelvemonth bridge. That cuts the production spread to a manageable $8,000 per car.
Merely can GM sell that many? Chevy dealers told CNBC that the biggest hurdle to buying a Volt — no surprise — is its price, which tops $thirty,000 even after a $7,500 federal tax credit. The Volt has fallen well short of the automaker'south initial projection of forty,000 U.Southward. sales in 2012, prompting GM to scale dorsum production last bound and again this fall. Simply if the automaker can finally lucifer the pace to its downsized schedule, the Volt may not go such a coin pit after all.
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Source: https://www.cars.com/articles/report-gm-loses-nearly-50000-on-every-volt-1420663104790/
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