(H/T – Will Collier)
CNN reports that Government Motors announced the price structure for the 2011 plug-in “hybrid” Chevrolet Volt, a 4-seat plug-in “hybrid” that is smaller than the Honda Insight. The retail price will start at $41,000, which after the $7,500 federal tax credit on plug-in vehicles, would create an effective price of $33,500. Even at the full retail price of $41,000, the Volt is going to be a money-loser for GM.
That is bad enough a business deal. What is worse is the 3-year lease terms – $2,000 $2,500 down, $350 per month, which CNN helpfully notes puts it in the ballpark of the all-electric Nissan Leaf. The bad part for the taxpayers is that we’re going to be paying just under half the $15,100 that Government Motors will get for the lease.
It gets worse for GM. At the end of the 3 years, GM would need to get $25,900 on the used-car market to get the full retail value of the car back. Meanwhile, used (and larger, and longer-ranged) Honda Insight and Toyota Prius hybrids will likely be going for $15,000-$17,000, and similar-sized conventional cars will be going for less than that. Something tells me that GM won’t get the $10,000 premium they think they’ll get for a plug, which only increases the losses.
Revisions/extensions (10:16 am 8/1/2010) – Corrected the down payment on the Volt lease. The rest of the numbers are unchanged.
