• Jul 28, 2010
Following yesterday's big announcement, readers got a chance to ask Tony DiSalle, product marketing director for the Chevy Volt, some questions about the car's brand new $41,000 price tag ($33,500 after tax rebates). Since DiSalle was here at the Plug-In 2010 conference in San Jose, CA, we thought we'd pose a few of our own.

We started with what, exactly, Chevy dealers will be able to do with this price. After all, the $41,000 is just the manufacturer's suggested retail price. DiSalle said:
We have messaged to the dealers to do the right thing relative to the price, to not mark it up. At the end of the day, they are independent businesses. That's why you call it manufacturer's suggested retail price. A good dealer will do the right thing for the customer because they want to ensure long-term business and, quite frankly, a lot of these customers haven't been into Chevrolet showrooms. We're also noting that, especially the early adopters will be very vocal about what price the dealer was asking them to pay and that word will spread instantly. Dealers need to know word will get out if they try to gross it up.
General Motors know this about Volt enthusiasts because it has 70,000 of them registered on a list. GM polled them in late spring and discovered 75 percent don't have a single GM product in their household. More recently, GM asked other questions and discovered that around 70 percent intend to buy a Volt and that they're not just along for the ride and to get information.

Back in March 2009, GM's executive director of global engineering, Bob Kruse, said that the Volt's price would be based, in part, on the price of gas in November 2010. DiSalle would not reveal when the Volt's price was actually decided but did say they considered the price of oil played a role. "We comprehended every value we could think of. Was that a determining factor? No, it wasn't," he said.

(this post continues after the jump)

We were also curious about how much money the first-gen Volt will lose, since GM had been quite clear in the past that losing money was a reality (see here and here), but DiSalle didn't seem to agree and wouldn't say definitively that it would or wouldn't. Instead, he said:
I'm not aware of GM saying that the first-generation will lose money. Certainly, we have every intention within the life cycle to make money. ... We're not going to comment on the profitability, specifically.
Did GM set the price at $41k knowing that a lot of government orders would come in and take care of most of the initial 10,000 units that will be built by the end of 2011? No, said DiSalle:
Our primary emphasis is to get the vast majority, as many as possible, into the hands of retail customers. We do have some fleet volume, some government volume, but it's not even close to being the majority.
DiSalle wouldn't give us a percentage of how many government sales there would be in the first year, just that, "The government business that we have for the initial model year is minimal."

Finally, DiSalle said that the $41,000 price tag was meant to not be a huge surprise:
Number one, the integrity that we've already created the expectation that the car would be priced somewhere around $40,000. So from an MSRP standpoint, that's been out in the public expectation for quite some time. So, in other words, we delivered on what the expectation was. What we are seeing already is a pretty strong propensity for people to really like the lease program. That was an option to position the vehicle as accessible. It gives people an opportunity to come in at $350 a month, $2,500 down for a 36-month lease and what we've seen already is a favorable response to that lease option.

The first year is going to be an interesting year, because you have a lot of people who have been waiting for this car. A lot of early adopters are wealthy, a lot of early adopters will pay cash and just want to keep the car, which is fantastic. We also have a buy option at the end of the lease. A couple of years into it, I would think we'd see the majority of the business being leases. This year, it's really hard to tell
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  • 46 Comments
      • 4 Years Ago
      Of course they won't comment on profitability. Rumor has it that the IPO will be in mid-August (some initial paperwork has been filed). They want to create as much positive sentiment and appearance of financial strength before trying to get people to buy thier stock.
        • 4 Years Ago
        Selling more Volts would help with the IPO. This car won't sell in any kind of real numbers at this price. Once again GM has reminded me of why all the negative stereotypes I have for it as a company are correct.
      • 4 Years Ago
      I'm deeply saddened by the high price of the Volt. I can only hope that they are trying to keep losses at a minimum, get more time to perfect the technology, get another year to cost-reduce the technology, and then come out with better/cheaper versions in following years.

      I can't rationalize purchasing the Volt now and I wanted the Volt more than I wanted the Leaf. I think the Leaf wins this year but it is just a start. I still think the Volt series-hybrid design is the better match for the USA considering our longer driving distances and our 110V home wiring standard. So I hope the can cut the price.

      Seriously now . . . the Volt costs $8K more than the Leaf. Yes, I know, they add an engine & generator. But the battery is much smaller than the Leaf battery. I can't see how adding a gas engine makes it cost $8K more. Perhaps Nissan is taking a big loss? Can anyone rationalize this large price difference?
        • 4 Years Ago
        I'm deeply confused regarding the price difference. In particular it is important to remember that when GM declared bankruptcy that their R&D costs for the Volt up to that point were effectively wiped off the books.

        I'd really love for GM to explain why their car with one third the battery capacity of the Leaf costs 8k more. Is Nissan (in GM's opinion) doing something wrong? Is GM milking the tax credit so that they can lower the price later on (likely)? Is GM having to pay too much for their unionized labor (duh, yes)?
        • 4 Years Ago
        The GM battery is one third smaller than the Leaf, not one third the size - 16kwh vs 24kwh

        Cost differences are partly due to the more complex nature of a hybrid - sure, the engine on it's own doesn't cost much extra, but there are a whole host of other components which have had to be designed specifically for the car, and producing them at low volume costs a lot.
        The low volume production is close to the heart of the problem, as Nissan are going all out to produce hundreds of thousands a year, GM is only talking a few tens of thousands for the Volt.
        For me the very centre of the issue is that GM have not fully committed, and have a half way numerically efficient production run planned for a car which has reached about half of proper design requirements.
        I can't help thinking that at some level in the GM bureaucracy they decided, maybe subconsciously, to do just enough to keep the Government grants rolling in, as politicos love a prestige project.
        GM seems to be dreaming of the day when they can go back to building 'proper' big iron V8 cars, not nancying about with electrics.
        • 4 Years Ago
        "Can anyone rationalize this large price difference?"

        Nissan developed its own proprietary batteries, controllers, electric motors, etc. GM relies heavily on suppliers who have to add in their development costs and margin on top before they sell to GM. And while it might make sense for limited production, integrating different parts together from different people into a platform that wasn't originally designed to handle it can be a more complicated and expensive process in the production phase than producing a car at mass scale that was designed from the ground up and optimized for the specific application (i.e. investing in development can save in production). Nissan is planning to sell approximately 10 times as many vehicles globally, so scale drives prices down and spreads out development costs.
        • 4 Years Ago
        With out knowing their respective purchasing agreements it's impossible. My guess though is this. GM can't afford to build cars at a loss, there is no way their government minders would okay this. I think GM has priced the Volt to at least breakeven. The lease price factors in the $7,500 credit yet the monthly is the same as the Leaf. My guess is Nissan is taking a hit on every Leaf initially, no matter what Ghosn says. Just like Toyota with the first Prius. Nissan/Renault have bet the farm on EVs, they can't afford not to have them get off to a good start. hybrids are 12 years old, yet currently represent less than 3% of the new car market. That won't do for Nissan, they need infrastructure development to make EVs palapable for mainstream buyers.
      • 4 Years Ago
      The $41,000 price is a lie.

      I was just in Courtesy Chevrolet in San Jose, CA moments ago to order my new Volt. I was already on a list, and the salesman told me the following:
      1. Their first allocation was 39 volts, and they were all already spoken for, including the one for me
      2. I would be the 7th preorder since orders were opened yesterday.

      We spent a good 20-30 minutes going over the options and picking a color, there was a 1 page price sheet. (From memory) Red is $695, white and viridian joule are $995. Leather package is $1395. Back up camera and parking assist is $695. Polished aluminum wheels (vs painted aluminum) is $595.

      After this is all done, he goes into his little room to talk to the manager, then comes back with the number:
      $54500

      I was dumbfounded. Before he left, I almost commented how pleasant the buying experience was compared to the last time I purchased a car. Now it had turned. After expressing my displeasure, he asked me did he not tell me there was a $10,000 dealer markup? I told him he most definitely did not. He told me all the Chevy dealers would have a 10k markup.

      I walked out.
        • 4 Years Ago
        lne937s:
        The dealer system is mandated by law in the US. Nissan cannot force dealers to sell cars to whom they choose. Dealers buy the cars from the maker then sell them to whom they want.

        Charley Martel:
        You can't be certain the salesman won't change his story later. They always are nice on the phone to get you onto the lot. Car salesmen are never your friend.
        • 4 Years Ago
        The $41,000 is the MSRP. Every dealer can charge what they think they can get. It seems your dealer has all his cars spoken for so they figure why not hose these folks? I would walk away, I expect Nissan dealers won't be any better.
        • 4 Years Ago
        So sad.

        I just got off the phone with the nice fellow who will be selling me my Leaf.

        I asked, "No $500 stripe packages, right?"

        He said, "The stripe packages are now $750. Just kidding, we'll sell it for MSRP. Just wait for your email notice from Nissan."
        • 4 Years Ago
        @ throwback

        "I would walk away, I expect Nissan dealers won't be any better"

        The dealers may not be any better people, but Nissan's ordering process is different.

        For GM, dealers who sell the Volt need to have a demonstration vehicle on hand (good for driving dealer traffic). Then dealers get allocated cars for sale to consumers. Production numbers are very limited (10,000 total produced by the end of 2011, less than half of the LEAF's US allocation for the 2011 model year) and you have to go through your dealer to get a car from this allocation, so you are pretty much stuck with whatever the dealer chooses to charge. Production is scheduled to go up to 30,000 in 2012, but that will be spread throughout global markets.

        Nissan has consumers order directly through the company. Consumers then pick which dealer they choose to get delivery from- putting consumers in control. Dealers aren't scheduled to have vehicles allocated to their lots untill 2012, around the time the 200,000/year Tennessee plant comes on line (as part of 550,000 global EV production) specifically for North American markets, making it easier to fulfill demand.
        • 4 Years Ago
        I believe you most likely made up that $10k markup story, but time will tell won't it?
        • 4 Years Ago
        The $41,000 is the MSRP. Every dealer can charge what they think they can get. It seems your dealer has all his cars spoken for so they figure why not hose these folks? I would walk away, I expect Nissan dealers won't be any better.
        • 4 Years Ago
        Brent,
        Wow. I'd like to say that you're joking or making this up, but I believe you. How pathetic.

        GM will probably have an easy time selling the initial 10,000 even with these tactics. But the ill will they will generate are going to last. Yes, I know the dealers are independent, but if I was GM, I would have made the dealers "bid" for dependent on who would sign a contract to provide the lowest markups.
        They would have still sold their 10,000 vehicles and would have generated a hell of a lot of good will with consumers. Who cares if the dealers like it...what...are they going to go somewhere else? LOL Screw them.
        • 4 Years Ago
        You should have burst out with laughter when he quoted that number and explained that you were already over-paying for such a small car just to support the technology and GM.

        But you would not support scalping dealers.
      • 4 Years Ago
      I/we are planning on getting the Volt AND the Leaf. I am significantly disappointed in the purchase price for the Volt and expect now to go for the lease option instead of the full purchase, IF GM had brought the Volt in at closer to $37,500 then minus the Federal tax credit, it would have been a purchase, but at the $41k plus a couple of the option items and WITHOUT the California state tax credit the Volt and GM's pricing and packaging approach is pushing us to the lease as the "best value." We remain eager to adopt this ER-EV technology, but GM has come close to a "turn off" with their approach to final marketing.
        • 4 Years Ago
        Our current cars, a 2006 Prius and a 2007 Camry Hybrid, have been in our garage longer, both in terms of ownership years and miles driven, than anything we have had in the last 20 years. I am a new car "as toy" person, and we have migrated through Infiniti, Lexus, Acura, BMW, Audi, VW, and into more environmentally appropriate choices like the two Toyota Hybrids. The Prius is our second in that model form even, BUT I had been hoping for a "hybrid sports car" like the concept shown as the Toyota FT-HS, which seems to have dropped from the planning program. I have had a deposit on an Aptera for about two years now, and last November we even did a "weekend trip" to Tokyo to check out the newest hybrid and electric concepts at the Tokyo International Auto Show. This past weekend, since my wife had meetings in Detroit, I was able to spend a day at the Michigan International Speedway to check out the Aptera and other "X prize" finalists for the award in "new tech" small company car designs. I am still somewhat hopeful of getting an Aptera 2e and the still unshown Fisker "Nina" holds a great deal of potential as does the Tesla Model S. Somewhere, sometime, somebody will actually do an affordable hybrid sports or EV sports vehicle....maybe?

        Bottom line: Yes, we do try to keep the "economy flowing, but with some green sensitivity.
        • 4 Years Ago
        Seems like an odd combination to me.

        If it were me, I would want one of my vehicles to be optimized for longer trips. The Volt is pretty small (smaller than a Prius, much smaller than a Jetta wagon) sounds like it's going to get worse highway mileage than either of those (and by highway I mean beyond 40 miles from your house).
        • 4 Years Ago
        I believe that the California tax credit is only funded for 750 cars. So, I don't know if you'll even get that with the leaf.

        Once you get both your vehicles, you should talk to the media. Sounds like a great story in the making.
        • 4 Years Ago
        Way to support the economy and greener transportation George Parrott.
        • 4 Years Ago
        G Parrott, you should look into the Amp Mobil Saturn Sky conversion. From what I have read it is fast, 150 range and is a sports car. They also are willing to sell a converted Equinox for 50k, I think it may go 150 miles in range also. They may come with 3 yrs 36k warranty also. Of course you may want to stick with OEM's as my experience is there is a bit of a turn around time in warranty work with a conversion.
      • 4 Years Ago
      It looks as though they are counting on the innumerate market to buy the car.
      Purchasing rather than leasing makes no sense at all on the figures they have given.
        • 4 Years Ago
        Why would you need to know the buyout price? If you keep the car for 3 years on the lease and hand it back you are paying around half as much per month as financing the $41k.
        • 4 Years Ago
        Because you don't know the total cost without the buyout price.

        If you're going to keep it for only 3 years, of course you'd lease. This is true of almost all leases. But if you want to keep it longer, you need to know the buyout price to calculate what actually makes sense.
        • 4 Years Ago
        At the lease price versus the buy price, the only thing that makes sense is to lease it for the 3 years.
        If they do such a cheap buy price at the end of the 3 years that it is worth taking up, then their figures do not add up.
        Either the lease price is too low, or the sale new price is too high.
        • 4 Years Ago
        How did you determine this without knowing the buyout price?
      • 4 Years Ago
      Meh.

      An another note.. i know a lot of you here have deposits down for the Nissan Leaf. Is anyone here planning on buying the Volt? just curious.
        • 4 Years Ago
        Middle Way:
        There is plenty of power in the gas engine to cover the power you need.

        The entire reason the Volt is a series hybrid is so that the performance would not change whether you were using gas or not. GM makes this clear. Those who have driven it back it up. But hey, Middle Way says otherwise!

        And then, you say the idea of running purely on gas is abhorrent, but you're a big fan of the Prius, because it uses gas, but it uses it sparingly, whereas a Volt just pours it out on the ground.

        It'd be great if you could get rid if your slant on this, stop downtalking things you don't like and pretending you're anything but expressing a bias in pseudo-technical terms.
        • 4 Years Ago
        @LS2LS7 "The entire reason the Volt is a series hybrid is so that the performance would not change whether you were using gas or not."

        This is nonsense. Either it is going to keep depleting the battery or the performance will change. You can't have it both ways.

        A short test drive were someone reports no change in performance is not a definitive test. I am sure the complaints will start once they get into user hands and people start taking them on road trips and spending hours in RE mode.
        • 4 Years Ago
        I agree with snowdog. I'm expecting the car to have lackluster performance when the engine kicks in, especially if the battery is not acting like a capacitor and smoothing out high/low throttle. To be capped at below 100hp would be painful in a car that's over 3500lb..

        And i think the idea of running entirely on gas is just an unagreeable mental concept in my eyes. Whereas a Prius does use gas, but as sparingly and efficiently as possible.

        I know i trash talked the plugin Prius, but dollar for dollar.. it's looking more appealing now.
        • 4 Years Ago
        The performance would suck if it got no battery boost. That may be part of the reason for the seemingly over-specified battery.
        If you are cruising you are fine, but for up hill and overtaking you need the boost.
        Hopefully GM have got their engineering right, but we won't know until it gets proper road tests beyond the battery only range, not a brief spin.
        • 4 Years Ago
        @Throwback,
        They are going to allow 12k before charging
        • 4 Years Ago
        Anyway, while i'm at it..

        Can you explain to me how a naturally aspirated 1.4L engine, including the efficiency loss of converting mechanical power into electric and back into mechanical again, can produce enough power to motivate a 3500lb+ car reasonably?

        Are there any test drive reviews in which the car has the gas motor running and battery depleted to the point of which the gas motor is doing the majority or all of the work?

        I'm not saying the performance will suck. I'm just saying i have no idea how it wouldn't suck.
        • 4 Years Ago
        @Throwback "I am planning on testing a Volt. My daily commute is too long for a Leaf, but the Volt could work for me."

        To each his own, I guess, but IMO the Volt makes most sense for someone who has a daily commute with the Volts range but has Range Anxiety.

        If your commute is too long for a Leaf, that means your Volt will be spending more than half the time running on it's range extender.

        So most of the time you will be driving a small heavy car with 70 HP. Seems like a formula for unhappiness.

        If I had a commute that long, I would be looking at a Prius or a TDI way before a Volt.
        • 4 Years Ago
        I said i expect it to not be great.. not that it is..

        I never said i'm a big fan of the prius. I'd own one if i was, lol..
        It's just that the gas that you put into the Prius is more sparingly used.. as in.. 10-20mpg better.

        We all have a slant, dude. But i only stated my opinions as opinions in this post.

        Welcome to autoblog
        • 4 Years Ago
        I am planning on testing a Volt. My daily commute is too long for a Leaf, but the Volt could work for me. I would however have to buy as I am sure the lease mileage is probably 10K per year. Depending on how it drives, the MPG after the battery is depleted and the build quality I will decide to buy, or not. I drove a Fusion hybrid the other day and was very impressed. It actually provided some driver feedback as opposed to the Prius, which seems to go out it's way to not feel like a car.
      • 4 Years Ago
      I reserved one at Dudley Martin Chevrolet in Manassas, VA. The salesman I talked with said they were allocated seven, and would have the exact details about them in August. He said they would sell it for MSRP + $3500 markup. Maybe they feel entitled to half of that yummy $7K tax credit?

      I half expect the final price to be much higher, having dealt with a similar situation when the 2004 Prius came out. However, I have hopes that this Chevy dealer is more honest than the Toyota dealer was.

      While I'm okay paying a $3500 premium to get first crack at a Volt, I'll balk at anything more. I want one badly, but not so much as to be taken by scoundrels.

      Here's hoping it works out!
      • 4 Years Ago
      I think the pricing is somewhat of a smart move on GM's part. Get buyers to go for the lease so at trade-in time GM can buy back cars that meet certain criteria: highest mileage, lowest mileage, most serviced, etc...then tear 'em down and see how things are working out. I suspect if the price were low enough, the number of available cars in 36 months will be lower.

      The other bit playing into the pricing is the volumes. 10k units a year makes piece costs for supplied parts pretty high. You need around 80k units a year to really drive piece cost low on things like interior trim parts.
      • 4 Years Ago
      You know the thing about the GM-Volt list, is you can't take your name off it once you've added it. So if others like me no longer are interested in the GM-Volt, the number doesn't reflect actual people interested in the car, just people who put their name on the list over the last couple years. So how many less than 70,000 are really interested in the Volt? Can't say, but I imagine at least 10,000 less, probably a larger number. Because since the list came out a few notable things have happened, like actual price, competing vehicles, and other things like the stupid horn thing (pedestrian approach warning signal) that probably turn potential buyers off. Other things still not disclosed, like MPG in CS mode, will also take a toll.
        • 4 Years Ago
        Yeah, the list is kinda meaningless. There was no deposit or any commitment. And no way to get off. I'm on that list but I can tell you that it is very unlikely that I would buy the Volt.
      • 4 Years Ago
      Friend went to get one today, he had been on the list to buy one, dealer had him come in today to purchase it. Went through the entire process and the dealer slapped a $10K markup on at the very end.

      He walked away and this ruined his purchase experience. As long as GM has these jerk dealers, they will have trouble getting new customers.
        • 4 Years Ago
        So it is true? GM dealers are driving Volt customers away. Nice! To bad I own this company. I should stop paying taxes. : ) Drive those Volt customers to Nissan, go ahead GM dealers. Mr. Obama did not say anything about a 10k mark up? He is in charge of hiring and firing these CEO's who make bad decisions. I better get on the horn to the President, excuse me.
        • 4 Years Ago
        Let me see, came in to pre-order it. Demand appears to be high. This is where the laws of supply and demand kick in.
      • 4 Years Ago
      I feel like I should go into a dealer and get the marked-up quote just so I can laugh and waste their time.
      • 4 Years Ago
      So all these reports of $3500-$10000 dealer markups on sales.

      How is this affecting the advertised lease price? How are the dealers getting their extra cut on leases?
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