KBB then uses some funny math to factor in the effect of the $7,500 tax credit, boosting the car’s value to 51 percent, better than the Toyota Prius or the Ford Focus. But a tax credit doesn’t lower the car’s MSRP, and there are too many variables involved to set an accurate residual value.
Consumer Reports noted
that fuel-efficient hybrids and diesel models often depreciate far less than most vehicles. And the Volt’s heavy dependence on emerging battery technology is another wildcard. GM has announced that the next-generation Volt’s battery will have twice the capacity and cost less, making the first generation cars obsolete when the new ones come out in 2015—like yesterday’s cell phone.
Gas prices are surely another wildcard. If they keep going up, so will used Volt prices.
The good news is that GM’s confidence in the Volt has led it to increase next year’s production of the car by one-third (from 45,000 to 60,000 units). And some comments by CEO Dan Akerson suggest it may go as high as 120,000 units in 2012.
The company is shutting down its Hamtramck plant for four weeks of retooling, which means fewer sales in June and July. GM says demand for the car is strong, but reported sales figures vary all over the lot—from 1,500 Volts sold from launch through April to 1,700 to 928. According to one site, GM will have produced about 3,300 Volts by the end of May!
Some 550 of these cars went to dealers as demonstrators, and the Volt has been sold in nine states, plus D.C. GM says by the end of 2011, it will be sold nationwide and in Europe, China and Canada.
All we can say is that the four weeks of lost production in June, while necessary, will likely push some prospective buyers into other vehicles. You can stretch demand (and interest) just so far.
The biggest problem with the Volt is its price. If GM can’t get the MSRP down significantly, it won’t matter how much capacity they expand.
Right now, Volt sales are lagging behind those of the Nissan Leaf. Do you see a trend there?