Reply #17: By five years out, we're back to GM's biggest fundamental problem: [View All]

[Occam Bandage]

that their production costs are far higher than foreign manufacturers'.

A Volt SUV may or may not be under early-stage design currently. However, Toyota, Honda, Nissan, Mazda, and Daimler are all currently working on plug-in electric vehicles as well; the Prius plug-in will reach markets within six months of the Volt. By the time a Volt SUV has been on the market for five years, I guarantee that Toyota or Nissan will be selling them as well. Moreover, they'll be making them more cheaply, and quite possibly higher in quality. You can't wish away the fact that American manufacturers are at a disadvantage of several thousand dollars per car on employee wages/benefits and contractor costs, nor that American supply chains are more costly than Japanese. The Volt is not going to be the savior of GM any more than the Hemi was the savior of Dodge--at best it will be a temporary PR advantage buying them a few years of operating at slightly lower losses.

As for the impact on fuel consumption? Given the likely $15,000-$20,000 tacked on to the cost of plug-ins, probably negligible; they'll be niche cars like the Prius is until there's simply no other type of vehicle on the market. As for the necessity of GM? Well, even if they were to go out of business tomorrow, Toyota would still deliver a plug-in hybrid by the end of 2010, so I'm not sold on the theory that Bush is trying to kill GM to keep them from making a plug-in hybrid.