While My Chevy Volt Gently Weeps

Did my wife just adopt an orphan?

General Motors (NYSE: GM  ) is halting production of Chevy Volt vehicles. The Michigan plant that assembles the battery-powered hybrid will suspend production for five weeks at the end of next week, and that comes after a prolonged holiday shutdown.

GM sold 1,023 Volts in February. My wife and I bought one of them.

It seemed as if the car -- which logs the first 40 or so miles on electric between charges before switching over to a nine-gallon tank of gas of nearly 300 more miles -- was finally starting to come into its own. After falling short of its goal of selling 10,000 cars last year and negative press surrounding its battery-pack woes, sales were revving up.

GM sold a mere 676 Volts before the 1,023 units that cleared out last month.

Even though GM sold more than twice as many Volts as Nissan (OTC: NSANY) did with its Leaf last month, it's been hard to catch a break.

There aren't too many plug-in vehicles on the road, but that will change. Tesla's (Nasdaq: TSLA  ) Model S sedan hits the market in July, with the recently unveiled Model X crossover SUV shooting for a 2014 release. Ford (NYSE: F  ) is about to crank out an all-electric Focus. Tesla partner Toyota (NYSE: TM  ) is working on an all-electric version of its RAV4 compact SUV.

Between reports of Tesla battery failures and GM idling its Volt plant through mid-April, it's hard to get too excited about the prospects of the new initiatives.

The move to halt production at the Volt plant is definitely going to send the kind of message that can become a self-fulfilling prophecy. In showing my wife's car to my father over the weekend, he told me that he heard that GM was killing the Volt. This is how misinformation starts. A five-week production lull gets misinterpreted.

It also doesn't help that GM in general and the Volt in particular have become the center of an unwelcome political tussle.

My wife isn't going through buyer's remorse. She loves her Volt, and it has impressed her friends on both side of the political electric fence. In retrospect, maybe we should've leased the car instead of buying it outright. In a move to clear unplugged and unloved Volts, GM just dropped the monthly lease price from $399 to $350 a month.

At a time when gas prices are nearing multiyear highs, it seems silly for GM to temporarily freeze the production of Volts. As bad as sales may have been, the news is -- pardon the wordplay -- shocking.

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The Motley Fool owns shares of Ford Motor. Motley Fool newsletter services have recommended buying shares of Ford Motor, Tesla Motors, and General Motors. Motley Fool newsletter services have recommended creating a synthetic long position in Ford Motor. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story, except for Ford. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.


Read/Post Comments (5) | Recommend This Article (3)

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  • Report this Comment On March 05, 2012, at 1:33 PM, CluckChicken wrote:

    The newest tech of the auto industry doesn't always keep it's shine very long. The Prius did not do well it's first few years, the Tesla Roadster is a warm weather car and the Leaf is even per Nissan sales members not really ready for everywhere yet (Nissan rep during Philly Auto show told me that).

    There is nothing to suggest that the Volt will be junk in the next several years and as gas prices climb the worry about it still being made will vanish. As fuel prices climb I am sure we will find that more and more money is being spent into research like:

    http://www.engadget.com/2012/02/29/envias-gm-backed-battery-...

  • Report this Comment On March 05, 2012, at 2:05 PM, F2JP wrote:

    Let's not forget that February is not typically a good month for the auto industry.

    Transforming how we fuel our transportation is not going to happen overnight, but it has to happen, so it will.

    EVs are just beginning to hit the road, the charging infrastructure is still just starting to be rolled out.

    New options, such as fuel cells, are being worked on as we speak.

    Don't forget the considerable influence being applied by oil companies to keep us addicted.

    Knee Jerk obituaries for EVs will always be there, but they prove nothing.

    We have to quit the oil habit, but it can't be done cold turkey.

    We are a people who love their rides, and our new toys. The ICE has about hit the wall when it comes to innovative, new technology.

    There's a lot to love about EVs!!! EVs are the one segment of the auto industry where true innovation is taking place, and will continue for some time.

    The Volt, unfortunately still has legacy ICE components that are subject to all the costs of fuel, maintenance, environmental issues, etc.

    It can be viewed as a kind of Graduated Withdrawal Method of kicking the oil habit, but it may not prove to be an accurate barometer of EV adoption.

    When I bought my first snowboard, (in the mid 80s) there was only one ski area on the East Coast that allowed them, (Stratton) and you had to pass a test to get on the lifts with one.

    Now snowboarding is the growth segment of the ski industry! Note that even though snowboarding has clearly become the significant market sector, in the ski industriy, there still exists animosity between the "Skiers", and "Snowboarders".

    There will be those who don't get EVs, even decades after they become the most prevalent segment of our transportation options.

    No one had to chose snowboarding over skiing, they just wanted to. They did so, in large part because that was where the innovation was.

    We do have to end our addiction on oil for many good, and profoundly important reasons, and that is where the innovation is.

    It is happening, and the pace will accellerate.

    How about a little "High Five" for those who step up and lead the way.

  • Report this Comment On March 05, 2012, at 8:55 PM, baldheadeddork wrote:

    No, the Volt isn't going to be an orphan.

    I've been critical of GM in a lot of areas but they did the Volt roll out the right way. It cost them sales, which we are seeing now, but the alternative could have been much worse.

    Travel back to 1980 with me. GM (and everyone else in Detroit) recognized that the Japanese were a serious threat and they had to be competitive, especially on fuel economy. GM benchmarked the Honda Accord (then in its first generation) and came up with the X-cars. They rushed through development in just a couple of years and launched the cars across all of their car brands (Cadillac Cimarron, represent!) with a massive ad campaign.

    It was a failure, one of the biggest in the history of the auto industry. The reliability problems started early and never stopped. Coming on the heels of the Vega it cemented the perception that US makes couldn't build good cars. The X-cars, in my not-so-humble opinion, did more damage to the US auto industry than any other single platform, ever.

    The development of the Volt was history repeating itself. Launched in a crisis, when GM was even more endangered than it was in the late 70's, and rushed through development in less time than they'd spend on a new pickup. I wrote here at the time that my greatest fear with the Volt was that GM would push the car to market before the reliability was nailed down and we'd have a repeat of the X-car fiasco.

    That didn't happen, but given the stakes if GM had pushed the Volt out with a big, national launch and then had to recall it several times, it was a wise move by GM to do a slow rollout over the first year and ramp up marketing when they knew the reliability was there.

    Which is where we are now. The Volt has proven to be as reliable as any car you can buy, at any price. Buyers absolutely love it, and if $5 a gallon gas returns it will become a lot more popular.

  • Report this Comment On March 06, 2012, at 11:01 AM, CluckChicken wrote:

    Chevy Volt named European Car of the Year

    http://bottomline.msnbc.msn.com/_news/2012/03/06/10591706-ch...

    Looks like it still gets some love.

  • Report this Comment On March 07, 2012, at 11:06 AM, JohnnieBD wrote:

    Do you people not understand "Market Demand" principles. Even in the face of crushing gasoline prices people are not buying the car...! ! ! That is why production has stopped. Talk to a Chevy dealer with 6 or 8 of these in stock who have sold none or maybe 1 or 2 in a YEAR. Only COMMAND ECONOMY cultures continue to build product that no one wants. First of all quit comparing it with the Nissan Leaf which is a total electric car [Another Market Demand Failure] and start calling the Volt what it is ....A HYBRID CAR. And quit bringing in the failed De Lorean which died because it got shut out of an engine that would make it perform and had to settle for a "do do Volvo engine". The same mentality that drove Kaiser and Tucker out drove De Lorean out. Malcom Bricklin flat conned himself and the Canadian Govt out. The TESLA failed a year ago and was "Bailed Out" by another hugh Govt low interest loan this time rather than a grant. Would be GONE by now had the admin not saved them. Wake Up...! ! ! This technology can only succeed in a war time economy. Do you think any one could have sold charcoal gas fume generators in cars in the 40's absent a war time deprivation of gasoline? Ck your history books both Germany and Japan did this...photos abound.

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