General Motors Co. (GM), missing
sales goals for the Chevrolet Volt plug-in hybrid, plans to
halt production of the sedan for five weeks beginning later
this month rather than discount the high-technology cars.
GM will stop making Volts at its Detroit-Hamtramck
assembly plant from March 19 until April 23, Chris Lee, a
company spokesman, said in an e-mail March 2. The factory
had ramped up to full-speed production Feb. 6 after the New
While sales of the Volt in February more than tripled
from a year earlier to 1,023, the rate is below what’s
needed to meet Chief Executive Officer Dan Akerson’s goal
of 45,000 deliveries in the U.S. this year. GM missed its
target of 10,000 Volt sales last year, finishing 2011 with
"This move is to keep proper inventory levels,” Lee
said in the e-mail.
GM executives have said publicity surrounding a two-
month federal investigation into the safety of the Volt
following a fire publicly revealed in November had hurt the
car’s sales. The National Highway Traffic Safety
Administration said in January that the Volt poses no more
fire risk than other cars.
"Although we loaded the Volt with state-of-the-art
safety features, we did not engineer the Volt to be a
political punching bag,” Akerson said during a
Congressional hearing on Volt in January. "And that,
sadly, is what the Volt has become.”
GM shares have gained 30 percent this year through
March 2, after falling 45 percent in 2011. The company
surpassed Toyota Motor Corp. (7203) as the world’s largest
automaker last year when it earned a record $9.19 billion.
The U.S. Treasury Department sold 28 percent of GM in
its November 2010 initial public offering and still holds
32 percent of the automaker’s shares, acquired as part of
the Obama administration’s $50 billion bailout. The U.S.
wants to sell for at least the $33 a share IPO price,
people familiar with the matter have said.
GM sold 1,626 Volts through the first two months of
the year in the U.S. Detroit-based GM planned to make
60,000 Volts this year for worldwide distribution, with
three-quarters of them earmarked for the U.S. market.
Akerson promised in January that GM would "match
production with demand.”
The model, rated by the U.S. Environmental Protection
Agency as getting the equivalent of 94 miles (151
kilometers) per gallon of gasoline, starts at $39,195,
excluding destination charges, and qualifies for a $7,500
U.S. tax credit.
"The fact that GM is now facing an oversupply of
Volts suggests that consumer demand is just not that strong
for these vehicles,” said Lacey Plache, chief economist
for auto-research website Edmunds.com.
"The price premium on the Volt just doesn’t make
economic sense for the average consumer when there are so
many fuel-efficient gasoline-powered cars available,
typically for thousands of dollars less,” she said in an
News that GM planned to reduce Volt production
resulted in further criticism about the vehicle.
"Even as gas prices continue to climb, President
Obama’s attempt to manipulate the free market and force
consumers into purchasing electric vehicles like the GM
Volt has failed despite the use of taxpayer dollars to prop
up production,” U.S. Representative Darrell Issa, the
California Republican chairman of the House Oversight and
Government Reform Committee, said in a statement.