There are apparently already some mules running with engine-generator and electric motor destined for the Volt. Lutz has now revealed the first mules that will include battery packs will be based on current generation Malibu body shells. Although the Malibu is larger than the the Volt is destined to be, it will be easier to package the hardware into one of these than the smaller Cobalt. If all goes according to plan (when was the last time that actually happened?), we should get a chance to drive these mules early next spring.
With a variety of rear-drive vehicles in the pipeline for the next few years starting with the G8 and Camaro, the question of 35 mpg CAFE standards was bound to come up. The key here is "The Senate proposition of 35 mpg is impossible based on what the market's looking for." That's not to say they can't meet the standard technically. It's just really hard to do with the kind of vehicles that people actually want to buy at current fuel prices. One possible solution to the conundrum of meeting market demands at the same time as the regulations is the possibility of putting the Two-Mode hybrid system into vehicles like the Camaro. What a novel idea, I wish we had thought of that.