The price point of the Chevy Volt has been increasing since before it was even made in clay. Insiders were predicting it’d be under $30k initially, and as it got closer to reality, the price kept going up. As recently as the beginning of this year, $30,000 even was the number, but they upped it even further and said the real price will be closer to $35,000 dollars. The $30k mark is traditionally the threshold for high volume electric car sales, anything above that generally won’t be a hit.
Luckily for GM, the US government has decided to spend everyone’s money to help a small minority buy plug-in hybrids. The bill automatically gives a $2,500 credit to anyone getting a hybrid, then an additional $417 per kwh for batteries greater than 4 kwh. For the Chevy Volt, that works out to $7500 per car, which could push the base price below $30k.
The tax credit will only apply to the first 250,000 plug-ins sold, and will be phased out over the course of the following fiscal year. In the end, it will cost you and me about $750 million dollars.
Instead of encouraging people to not buy new cars at all, and to use their old ones and save money and not get into debt, the government is once again encouraging spending and lending and credit and consumption. Not a smart thing to do as we enter a recession.
On a more upbeat note: You ever wonder why the Volt doesn’t look as cool now as it did back at the Detroit Auto show? Here’s Lutz explaining: