DETROIT (WWJ) – General Motors will be halting production of the Chevy Volt for five weeks because of slow sales.
GM had once hoped to sell 45 thousand Volts in the U.S. this year. In the first two months they sold just over 1600.
“The fact that GM is now facing an oversupply of Volts suggests that consumer demand is just not that strong for these vehicles,” said Edmunds.com cheif economist Lacey Plache. “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.”
The current 154 day supply of Volts was considered too high. General Motors has been saying recenlty that it would build the volt to market demand.
The Volt runs on electric power. It has a battery pack that will operate the vehicle for 25 to 40 miles. After that, a gasoline engine generates electricity to power the vehicle.
It’s been a subject of controversy since its launch. The Volt was named “North American Car of The Year” and “Motor Trend Car of The Year.” But, critics have turned the Volt into a symbol of the auto industry bailout.
In a message sent out on Twitter late Friday afternoon, GM defended the Volt, and expressed confidence in the future of the vehicle.
“We stand behind the vehicle and technology. We’re adjusting for market demand, and see great potential.”
Some analysts, like Michelle Krebs of Edmunds.com believe the jury is still out on the Volt’s future.
“This period of high gas prices should have given sales of the Volt and other hybrids and electric cars a lift,” she said. “Instead, there’s a wide selection of 30 mpg and even 40 mpg cars that don’t carry the hefty premium of vehicles like the Volt so the Volt, Nissan Leaf and others are up against stiff competition.”
As GM was announcing changes in Volt production, Ford announced that it’s upcoming electric version of the Ford Focus will get a 105 mile per gallon fuel ecnoomy equivalant. The Volt also faces competiton from the electric Nissan Leaf and plug in hybrids that are coming this year from Ford and Toyota.
The move will affect 13-hundred workers at the Detroit-Hamtramck Assembly plant. The workers will be laid off starting in two weeks. They will return to the job on April 23rd.
Currently the Volt, and its European counterpart the Opel Ampera, are the only vehicles made at Detroit Hamtramk. The plant is gearing up to also build the Chevy Malibu. Additional production will expand Detroit-Hamtramk to a three-shift, 24 hour a day operation in a few years.
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