Who is Going to Use all those Charging Stations

I hear from friends who own them that the Chevy Volt is a fantastic car.  And I don’t disagree. I’m sure it is. However it is not what the market place wants. With dozens of hybrids out there selling at two thirds the price, the market simply isn’t buying it:

But a new study by CNW marketing raises a red flag, finding that the potential buyers GM is most counting on are rapidly losing interest in the Volt.  In March, 21% of so-called Early Adapters said they were “very likely” to consider buying a Volt, while 38.1% said they were “likely” to do the same.  That slipped to 14.6% saying “very likely” in July, and 31.1% “likely.”  Among EV Enthusiasts, reports the CNW study, the number of those likely or very likely to consider Volt fell from a combined 71% to 51% during the same four-month period. …

The big problem is the plug-in’s price, CNW data indicate.  When first introduced, the Volt carried a $41,000 sticker, though it qualified for a $7,500 federal tax credit.  For 2012, the Chevy will drop to $39,995, a $1,005 cut, though it is still thousands more than the Leaf – and nearly double the price of a base Chevrolet Cruze compact, which shares the same underpinnings as Volt.

I’m not sure it is just price. Americans want big cars. The Obama Administration thought that bringing in Fiat to run Chrysler would bring a small car philosophy to the car company. However the reverse is true.  Fiat is actually taking the Jeep Cherokee Chassis and slapping a Lamborghini design body for European consumption. We should also note that Chrysler is profitable primarily for SUV sales, which have a $4-$5000 profit vs a $1000 or so profit for small cars.

So called “Green” Companies are going bankrupt one after another. These are companies that received huge government grants. Read about it in the IBD. The government thinks it knows more than the marketplace.  It is wrong.

Successful companies invent, manufacture, market and profit from products and services that the market wants, not from products and services that are mandated. The market simply won’t buy it. It seems so obvious.

But then, I guess when the people making the decisions have no experience in the market, and only have a theoretical  understanding of business, that’s what happens. Nothing, believe me, focuses you more, than having to come up with that payroll every two weeks.

I was told once that when you are an employee paydays are very far apart, but when you are an owner, they are really close together.

JVH

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