Friday, October 5, 2012

GM’s Voltec – When No News Is Sort of Good News

Published October 5, 2012


By Jeff Cobb



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Critics have panned the Volt, but it leads the plug-in charts, outsells many other cars besides, and General Motors is committed to its powertrain technology. Unfortunately for inquiring minds who want to know, GM is not sharing a whole lot of details on what's next.



By now most advanced-tech car followers know the Chevy Volt set another record of 2,851 sales in September – a narrow 0.7-percent increase over the 2,831 sold in August – and the good news for Voltec fans beyond this is GM says it is definitely committed to its plug-in technology.



For all the critical media questions about the Volt’s relative success, the Volt for now remains heads above the plug-in car market but with others gunning for it even so.



Its 16,348 year-to-date sales surpass the March-launched, and not fully rolled out plug-in Toyota Prius PHV which may be catching up with 1,652 sales in September – a sizable 57-percent increase from August sales – and 7,734 sales year to date.



Nissan’s Leaf also saw a year-to-date record 984 units sold in September representing a big 43.6 percent rise over August sales but it has just 5,212 year to date.



For all intents and purposes, while more plug-in competitors are coming, these are the only solid players in the U.S. market at the moment – not counting Tesla and its high aspirations but with maybe 250 Model S sedans sold so far, and Fisker having sold over 2,500 or more Karmas this year – at least this number is in line with what speculators have guessed.



But GM cannot afford to rest on its laurels – and the good news for fans is it is not – but while it was more willing during the Volt’s 2007-2010 expedited development to share details and progress, it is less so now to divulge whatever it has up its sleeve.



In trying to learn more about GM's aspirations for it’s “extended-range-electric” plug-in technology called “Voltec,” – and why GM’s next move is up market to the Cadillac ELR instead of to more bread-and-butter variants, we spoke yesterday with GM electrified vehicle communications personnel.



Alas, we did not get much, but as you likely know, the ELR is the only known Voltec variant on the roster pending production. Despite all the rumors, the 2014 model year launch date is not official, but we otherwise have reason to believe it is a good guess.



But, we asked, besides answering whether the market needs another more-or-less $75,000 plug-in car, what about down-market Voltec options?



Wasn’t the $40,000-plus Volt once upon a time during its development said to be targeted to sell for around $30,000 – before discounts or incentives? So even if it does cost more now, isn't Voltec a solution for the mass market?




Wasn’t GM’s Voltec an answer to OPEC and environmental concerns?



Yes, the Volt is the king of a small but growing hill, however as many fans, let alone critics have observed, opportunities to flesh out a product line remain. Right?



The proof of the Volt’s concept has been widely observed that even though it’s a kind of pricey four-seater Chevy, it is amassing raving fans, is super frugal to operate, starts paying back the up-front costs right away, has racked up lots of awards, and is being exported from the U.S. to everywhere, even China.



It’s drivetrain technology helps justify the car, and has plenty of potential for spin-off models besides.



But, we asked GM, how is it going to change the world if to date we've seen just over 16,000 units sold this year in North America out of around 10.8 million total vehicles total?



Of course Voltec is not expected to have taken significant share so soon, but GM has reduced sales projections from 60,000 Volt and Ampera versions globally this year to "matching supply with demand." Nor is it saying anything definitive about other variants that could help fill out a bread-and-butter model line and create far more momentum for GM's E-REV technology.



Unfortunately, GM is not even prepared to discuss how it sees the upscale ELR fitting into the market, and what its expectations for that car will be. The ELR got started in 2009 as the Converj concept shown at Detroit, so that ball was already sort of rolling before Volt was launched late in 2010.



GM has also shown the MPV5 Voltec crossover in China, and it has Voltec-related research and development ongoing – but under wraps – to see what other models could be marketable.



And while Voltec is an important part of its strategy, GM is not putting all its eggs in a Voltec basket.



But wouldn’t it be in GM’s interest to proliferate Voltec vehicles below the $40,000 MSRP line – like say down into the 20s and 30s where GM could sell a lot more volume?



Yes it would, but GM is keeping these details to itself for the time being even as it works on ways to cut existing costs out of the production Volt, and develops other electrified vehicles like the Spark EV, eAssist mild hybrid variants, and works on a host of technologies including fuel cell vehicles.



So as much as we’d like to know timing and details of what’s next for Voltec, GM’s communications strategy has shifted.



Why? Nearly every other automaker is now working on plug-in cars, including three start ups in California, and it is not in GM’s interest to tip its hand.



What is technologically possible in terms of cost, features and performance actually is not something GM sees as in its best interest to broadcast specifics about when such news would fall on the listening ears of competitors as well as the general public.



But, we asked, doesn’t the competition know more than the public anyway? What would it hurt to share expected electric range for the ELR, or launch date, or that GM will produce a $32,000 Voltec variant in two years, or something like that if it were so? Wouldn’t that buy good will, and create excitement, and enhance GM's image?



Maybe, or maybe not, but the policy is what it is, and GM has its reasons.




So for now, advanced Voltec news will likely continue to come from rumors and speculation – which may be wrong – but officially, GM says it is working on a variety of options that will “meet customer expectations.” Its policy is to wait until pretty close to launch date and when the production vehicles are basically finalized, then spill the full beans and work on amping up that excitement.



So sorry, the news is there’s little news, but this is the state of competitiveness, at least for GM.



Meanwhile, we do have the Volt’s progress to track.



While more often we hear GM is only “matching supply with demand,” Bloomberg reported GM Chief Executive Officer Dan Akerson said in June he expected as many as 40,000 global Volt sales this year.



European sales data has been difficult to get in a timely manner, but last we heard from Europe, the Volt/Ampera is on track to exceed its allocation of 10,000 cars this year. And then you have a small number being sold in other markets like Canada, Australia, Brazil, New Zealand (pending), China (negligible) ...



To date the Volt has sold 16,348 in the U.S. and there are three months to go. If GM conservatively sells 2,500 per month, that’s another 7,500, which added to 10,000-plus exports would bring the total to somewhere around only 34,000-plus globally, not quite 40,000.



Let’s see if Europe/UK sells more than 10,000, and what Canada and Australia do. If it is only 10,000-15,000 worldwide units exported in all, then GM may either just make it, or need to set serious U.S. sales records each month for the last quarter of the calendar year for the unofficial 40,000 target to be hit.



But again, officially, there is no target since GM revised it from 60,000 globally estimated for 2012, and started saying it would match supply to demand.



But people will nonetheless be watching, measuring, and analyzing the Volt’s progress, and the company's CEO was quoted mid-year, so we're down to an unofficial race this year just like last, when 10,000 U.S. units was the goal that was narrowly missed.






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