• Apr 28, 2008
Last week, Holman W. Jenkins, Jr. got space in the Wall Street Journal to question "whether GM is a genius or a dolt for developing the Volt." Jenkins suggests that gas prices might drop again. If this happens, then GM can say goodbye to consumers who want the Volt, Jenkins says. A big drop in gas prices is unlikely, based on recent trends and predictions, but not impossible. Jenkins' argument is one reason that an artificial floor on fuel prices - through higher gas taxes or a set minimum on oil prices - would secure the industry's investments in green cars. Jenkins is also unimpressed by GM's willingness to lose money on the first Volts, but he does see one strategy where GM "bribe(s) consumers to drive Volts off the lot. That is, if doing so frees GM to build and sell other cars bigger and more powerful than the cars its rivals can afford to build under the CAFE rules."

In the end Jenkins doesn't answer his own question. To be fair, this chapter is far from finished and an answer can't be declared just yet. While we're still a long way from Job 1, I think it's pretty easy to answer that the real dolt move here would be to not try to create a car like the Volt.

[Source: WSJ via BusinessWeek]


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