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Volt’s cost shocking versus Cruze

August 23, 2009
By LARRY RINGLER Tribune Chronicle

Will the Volt be a lightning bolt or a flash in the pan?

That's the multi-billion dollar question facing the nation's once-mighty automaker as it begins its second century or is it its first after emerging from bankruptcy? with a host of new vehicles that at the very least are creating a buzz of excitement.

With all due respect to the soon-to-be Lordstown built Chevrolet Cruze, none is generating more of a buzz OK, the puns are shameless, I admit than the Volt.

And none should generate more night frights for executives.

The sheer economics of the Volt are sobering. Sure, GM claims it will get as much as 230 miles per gallon of gasoline, although there are more qualifiers than politician's promise.

But let's say it never uses a drop of gasoline, which could be the case, based on average annual driving miles of 15,000.

Divide that by 365 days and you get 41 miles a day. Let's round that down to the 40 miles GM says the Volt will travel on just a fully-charged battery. No gasoline station stops, ever.

Of course, you have to charge it from your wall outlet, costing about $300 a year, so that's your total fuel cost.

The rough part is the payback period on the Volt's $40,000 price tag, or about twice as much as what industry experts are pegging the Cruze to cost when it starts rolling off the Lordstown assembly lines in April.

The Cruze is supposed to get 40 miles per gallon or more. Based on 15,000 miles a year, a Cruze owner will use 375 gallons of gasoline a year. If gas rockets to $4 a gallon, as it did in 2008, the fuel cost for the Cruze will be $1,500 for the year.

Divide that into the extra $20,000 it'll take to buy a Volt, and it'll take more than 13 years to pay off the electric car's higher initial cost.

Tacking on the GM estimate of $300 a year in electricity it'll take each year to charge the Volt takes the Volt's knowable cost disadvantage to the Cruze to $23,900, meaning it'll take nearly 16 years to recoup the higher expense. That doesn't even consider the expense of replacing the battery pack or any other unknown outlays that new technology brings.

This isn't to trash GM for pushing ahead with electric vehicles. I think they're the wave of the future, especially if we focus more on nuclear power to ensure the steady supply of power that will be needed as more electric vehicles hit the showrooms.

More power that slipped out, honest to the ''first-movers,'' those people with the money and vision to step up and buy the first Volts. We need them to create enough demand for the new technology so GM can crank up production to the point where the price will drop and the rest of us can seriously consider the car.

For now, I'm just thinking like Joe Average Consumer looking to keep my had above water. For most of us, that mean fuel-efficient vehicles like the Cruze offer the most bang for the buck, which is why even analysts have called the Cruze, not the Volt, GM's most important new car.

Here's to a rock-n-rollin' launch in April.

lringler@tribtoday.com

 
 
 

 

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