Next Chevy Volt $10,000 Cheaper To Build, Profitable For GM?

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2013 Chevrolet Volt  -  Driven, December 2012

2013 Chevrolet Volt - Driven, December 2012

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Here and there, a few little tidbits about the next-generation Chevrolet Volt electric car are starting to leak out.

The latest comes from GM CEO Dan Akerson, who told the audience at Fortune's Brainstorm Green conference Tuesday that the next Volt would cost "$7,000 to $10,000" less than today's model.

The 2013 Chevy Volt carries a base price of $39,995 before Federal, state, and local incentives--roughly double the price of Chevrolet's non-electric compact Cruze four-door sedan.

Akerson also noted that the second-generation Chevy Volt would be profitable, unlike the current version.

"We're losing money on every one," he admitted.

The next Volt (and derivatives, presumably including a next-generation Cadillac ELR range-extended luxury coupe) will be considerably lighter than today's car, which weighs in at 3,781 pounds.

And it will ride on a dedicated platform, according to GM product chief Mark Reuss, rather than an adapted version of GM's compact-car underpinnings used for the Cruze and other models.

GM said last fall that it plans to downplay hybrids in favor of its Voltec range-extended electric technology.

It sees the Voltec powertrain giving it a big lead on any other carmaker that offers a plug-in hybrid adapted from conventional hybrids--including Ford, Honda, and Toyota.

The current Volt, launched in December 2010 as a 2011 model, will likely run through the 2015 model year with few modifications.

The next generation will probably be unveiled in 18 to 24 months as a 2016 model.

The Chevrolet Volt range-extended electric car was the best-selling plug-in vehicle sold in the U.S. last year.

Through April, its sales are pretty much neck-and-neck with the Nissan Leaf (now built in the U.S.) and most likely lower than those of the Tesla Model S electric luxury sport sedan.

The Fortune conference was held in Laguna Niguel, California, which also gave Akerson a chance to tease the audience for driving "ugly German cars."


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Comments (30)
  1. Hopefully this will come without sacrificing the things that people have come to love about the car. Look forward to seeing the next gen

  2. Damnit, now I have to wait till 2015! I was just about set to buy early next year.

  3. Our timing is a little off, but my Volt lease ends in early 2015. I was already leaning toward a pure EV and not another Volt but I still want to see what's out there, of course.

    Would a lease make sense for you for 2-3 years? That's the only reason I leased, so I could buy/lease again once there were more options. Anyway, good luck with whatever you decide to do!

  4. A lease might make sense if I were planning on the next, cheaper, Tesla. But it's difficult for me to plan on that without knowing how much, what, and when that will be. It's on my list of things to consider though.

  5. extend your lease one year, then, go to the next gen.

  6. Yeah, understood. Many of us here are in similar shoes. I'm tempted to make an early deposit on a Model S, but not before seeing the i3, for example. I love Audi and that's what I drove before my Volt and want to see what they offer, too.

    Whatever you get, I'm sure you'll love it. One big decision for me is solar; I absolutely want it by 2015 in time to get an EV, not PHEV, but the cost could limit my EV choices.

  7. This is great news. But can we know what exactly is the difference between the previous one and the new model as to make the price for the latter lower? Will it sacrifice durability and/or performance?

  8. The difference is not so much the car, it is the production process and probably battery. Never underestimate routine as a major force to lower cost. Larger numbers will help too.

    Are the cheaper telephones, computers, televisions of today technically inferior to those of 10, 20 years ago?

  9. As technology and manufacturing processes improve, things become cheaper. Think back to several years ago when DVD players first came out, and they cost $1000. Today, a DVD player with comperable features is half the size and around $20 simply because technology and the manufacturing process has improved. As batteries become more efficient in storage capabilities, you can use fewer, smaller batteries which will save money without impacting performance.

  10. @Kevin: Battery cells do not improve at the same rate as microprocessor based consumer electronics, however.

    Those consumer electronic devices follow Moore's Law, which says that processing power doubles roughly every 18 months.

    Battery cells, on the other hand, improve in cost-performance roughly 7 percent a year:

    Don't make the mistake of confusing improvement rates in two quite different technologies.

  11. 7% per year is still very considerable. In five years batteries will be 40% more powerful by these numbers. So the LEAF would go 120-140 miles, the biggest Model S would have a range of 370-420 miles. That's the range of a lot of petrol cars these days! Or alternatively it will help GM sell the Volt profitably...

    Also the more major manufacturers get into battery development the faster that development will go!

  12. Just to be clear, the Model S basically is running on 2011's batteries. As to what a 2018 would be able to use, that's another question, but I wouldn't use 2013 as the baseline year.

  13. @ John Voelcker: Not the tired old 7% improvement myth again. That was never an accurate rule of thumb in the past nor will it be in the future. Only a few years ago "experts" pegged battery cost between $700-1200/KWh. Today companies like Nissan and Tesla have battery cost in the $300-$400/KWH ball park. How does that add up to 7% /year improvement?

    The hints GM drops about 200 mile EVs and PHEVs that are substantially lighter and cheaper indicates how battery costs really develop: by leaps and bounds depending breakthroughs in battery technology and production technology.

  14. @Chris: As I've said before, I've spoken to engineers at both battery companies + their clients, the automakers.

    Unless and until you can show me studies, or introduce me to sources who will go on record, supporting your view that the rate is far higher than 7 percent a year, I'll stick with the results of the interviews I've done over several years.

    I'm always open to changing my views. But "hints" from automakers, from GM to Tesla, are just that. GM could make a 200-mile electric car TODAY: It would have a 40- or 50-kWh battery pack. Whether it could do so at a reasonable cost is the issue.

    Akerson + predecessors, recall, also "hinted" they'd sell 60K Volts in 2012. They didn't.

  15. John,

    Moore's law is not a law of nature, it reflects the investment of R&D of the big silicon companies. When R&D slows, change slows.

    Now we are seeing some real investment in battery and consequently the improvement rate is speeding up

  16. There are more comments in this thread
  17. Please for the love of Volt give us FIVE (5, cinco, Fünf, Cinque, Cinq, Пять, 五, חמש , خمسة, Πέντε, पांच, Beş, Cinci) seats!

  18. In such a small car? Why?

    We should ask VW to put 5 seats in the CC, Audi in the A7, Porsche in the Panamera, Mercedes in the CLS, or Aston Martin in the Rapide. ;)

    Instead, GM should have produced the MPV5 by now.

  19. I would agree. Of course, it would be great if GM could offer both the Volt and a CUV/MPV to satisfy different customer demands. I actually usually prefer four-seaters (hate bench seats!) but the hump in the back makes for a very uncomfortable ride for our dog...

    Let's hope the Voltec system or a new system makes its way to more vehicles by GM, but considering the slumping Volt sales recently, GM may err on the side of caution.

  20. I really hope that the next Volt will have 5 seats. With a wife and three kids, the current volt lacks versatility.

  21. Although I prefer the four bucket seats, personally, I understand that I'm in a relatively small minority there and that's partially because of no kids. There's no doubt that the current seats hurt sales.

  22. Same here - Without 5 seats the car is irrelevant for me. 5 seats make it a sure buy.

  23. Wondering how the 2015 Volt price reductions will play into how the 2014 Cadillac ELR is priced?

    The ELR is great looking design based on technology derived from Volt power train. GM has stated that ELR production volume will be limited. Sharing technology is a great way to lower costs and increased vehicle options are great for drivers. :)

  24. A very good question, Brian. Unfortunately, my company car allowance is fine for the Volt but not the ELR, so it won't help me personally either way. But I love the design.

  25. I think GM drops another hint here that its on to some pretty impressive next gen battery tech. Only with massively improved battery tech could the next gen be substantially cheaper and lighter because as a concept PHEVs are very complex and expensive to build, something that won't go away after the first generation.

  26. 50+ mile EPA battery electric range please, improved heater that doesn't drain the battery as fast, bright colors without paying extra.

  27. I wonder how they are allocating the fixed costs of car production? Are they not making a profit on the variable cost of each Volt?

  28. it's great if the price drops, that would really make the VOLT affordable, but,
    what it really needs to drive up sales is an offboard inverter. If you could plug in the volt and use it for emergency power, the sales would skyrocket.

  29. I run my pellet stove and fridge already with my Volt. You just get the Volt EVextend wire kit and you can plug-in a pure sine wave inverter for your home, can run up to 2,000 watts continuous. The kit costs about $150.


  30. They probably should have waited a year before saying that.... could hurt sales.


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