GM loses $49,000 for every Chevy Volt they build Independent Journal Review

GM loses $49,000 for every Chevy Volt they build Independent Journal Review

GM loses $49,000 for every Chevy Volt they build

Kevin Danielsen September 10, 2012 7:34 pm

It’s no wonder why the Obama administration sweats every time GM releases the numbers on how well the Chevy Volt is doing.  The President has elevated the Chevy Volt to be the rhetorical future of American automotive innovation, even going as far as to say,

“I got to get inside a brand-new Chevy Volt fresh off the line,” Obama said about a recent visit to a Detroit Chevy factory. “Even though Secret Service wouldn’t let me drive it. But I liked sitting in it. It was nice. I’ll bet it drives real good. And five years from now when I’m not president anymore, I’ll buy one and drive it myself.” [Politico]

That’s quite the Presidential endorsement.  However, a recent report from Reuters states that the Volt has become a thorn in the side of the government-owned automaker:

Nearly two years after the introduction of the path-breaking plug-in hybrid, GM is still losing as much as $49,000 on each Volt it builds, according to estimates provided to Reuters by industry analysts and manufacturing experts. GM on Monday issued a statement disputing the estimates.

The problem doesn’t just end there.  The Volt has been the ‘go-to’ car for the federal government, and even the Pentagon, meaning that the government Volt buy-up is landing the automaker even farther in the financial hole.  GM is doing their best to keep these costly cars moving off the line, even going as far as to practically give them away for less than what the car costs to manufacture and sell:

The lack of interest in the car has prevented GM from coming close to its early, optimistic sales projections. Discounted leases as low as $199 a month helped propel Volt sales in August to 2,831, pushing year-to-date sales to 13,500, well below the 40,000 cars that GM originally had hoped to sell in 2012.

Nevertheless, the article continues…

Out in the trenches, even the cheap leases haven’t always been effective.

Obama’s baby, the Chevy Volt, has become quite the problem child.  Just the fact that Volt costs GM $49,000 to build it, means that something must be fundamentally wrong with the O Team’s business plan.  Of course, when has the US government ever been good at running a business?
So, let’s break this down…
GM lets unions takeover the company, running the automaker into the ground.  Obama wants to appease the unions, so he uses our dollars to bail them out.  The Obama administration decides that GM should ‘go green’ and gets them to develop the Volt.  The Volt fails miserably, costing GM a ridiculous amount of money just to make them, much less sell them.  The government decides to improve GM sales figures by buying Volts, just so it doesn’t make the bailout look like a failure, costing the taxpayer even more.
This is what happens when government wants to go into business.  The taxpayers suffer the losses, but corporations and government walk away scot free …as they raid the taxpayer’s vault.