Electric cars seem to many as the next frontier in the auto industry, not only is it easy to find an electric outlet, they also less detrimental to the environment. However some experts estimate that GM loses as much as 49,000 dollars on each volt it builds. This is including research and development costs. Despite the 7,500 dollar tax credit from the federal government, the Chevy volt seems like a clearly poor business decision. Not to mention GM is fresh off a bailout from the federal government. GM is hoping that the volt follows a similar path as the Prius which just recently became marginally profitable. The volt, as well as nissan’s leaf, are largely in response to Toyota’s success with the Prius. Do you think given GM recent financial problems the volt is a good idea? Will it give GM the an completive edge in the auto industry’s oligopoly?
The facts for this blog post are from this article: http://www.reuters.com/article/2012/09/10/us-generalmotors-autos-volt-idUSBRE88904J20120910