Two of Congress’ biggest sticking points for the Big Three bailout are cutting costs and developing greener technologies, but could the two be at odds with each other? A recent report shows that that could be just the case for General Motors.
GM’s Chevrolet Volt range-extending electric vehicle is seen as the company’s savior, but the revolutionary EV doesn’t exactly fit within the framework of the government’s restructuring plan. According to CNN, the Volt will cost GM $750 million in development costs by the time it hits the road in 2010 – not exactly the kind of cost cuts Congress is looking for.
Moreover, the Volt isn’t expected to be profitable for GM until the second-generation car hits the market sometime around 2016, making for a poor short-term business plan.
But, despite its high costs, the Volt is a crucial model for GM, just as the Prius was for Toyota. The Volt is an image changer, regardless of how it will impact GM’s balance sheet for the short-term. However, it remains to be seen how a government car czar will view these expenses. Will they simply view new green technologies in dollars and cents or take a more long-term view of things? Only time will tell but we sure hope for the Big Three’s sake both can carry on harmoniously – like in the case of the Volt – otherwise bankruptcy might be inevitable.
12/10, 12:13 PM
posted by:
DCG3
Hey just finished posting on the previous article and look what shows up in the one
THE ****ING PRIUS!!!!!!!!!!!!!!!
12/10, 12:15 PM
posted by:
rsg
Oh please. This technology is GM’s future so you have to invest in it. Why invest all this money so we can keep the same unsuccesful products clogging up dealers lots?
12/10, 12:18 PM
posted by:
Z06ified
This is why you can’t have a car czar in the first place. That’s a dictatorship, not a democracy in which capitalism is deeply rooted. Capitalism doesn’t work under dictatorships.
The whole concept of board of directors, shareholder votes, etc. is being thrown out the window and being replaced with one person who will have absolute power. Absolute power corrupts, absolutely.
12/10, 12:19 PM
posted by:
Bankruptcy2009
IF GM was serious about an Electric they would have brought the Impact to market when they had the
Chance to do so.
12/10, 12:21 PM
posted by:
Bankruptcy2009
Well that is What GM was and still in AbsolutelyCorrupt Corvette Bone Head
12/10, 12:30 PM
posted by:
jl_2
Z06ified, you sound like you don’t really know what you are talking about.
12/10, 12:38 PM
posted by:
2kPlymouthNeonLX
Classic: Damn if you do, Damn if you don’t.
12/10, 12:55 PM
posted by:
A4
if the government doesnt look at the volt as something that needs to be fast-tracked right now for its long-term benefits than they are A, a bunch of dumbasses, and B, a bunch of hypocrites, stating that green technologies need to be brought to the forefront of any type of plan, rather than profitable trucks and SUV’s, which would seem to make a better “short term” case. It would be their dumbest move yet to go against the volt.
12/10, 2:06 PM
posted by:
Fit19
Capitalism? The Big 3 abandoned capitalism the second they went to Washington for a handout.
12/10, 2:12 PM
posted by:
Borat
In true democratic society Big 2.6 would be bankrupt and if there is a solution to a problem (manufacturing cars in US public wants to buy) the market would address it. At this moment, Big 2.6 bankrupted their investors (shareholders) and against SOX standards no one went to jail and government is giving them tax money to burn. This kind of democracy is native to Cuban and Venezuelan models, not US standards.
12/10, 2:18 PM
posted by:
Borat
• The only thing crazier than trusting the same management and union officials who got the Big Three into this mess to get them out is trusting a bunch of Washington politicians and bureaucrats – the very same people who ran up a $455 billion deficit last year. American auto workers and their families deserve better.
• If no private investors believe the Big Three restructuring plans are realistic enough to support with their own money, why should we put up taxpayer money? American taxpayers deserve better.
• The Big Three restructuring plan and the Democratic proposal lack accountability. There is no guarantee that once they get taxpayer money the restructuring they promise will occur. Once the taxpayers prop them up once, there will be a big incentive to keep bailing them out – keeping the industry dependent on government aid, lashing it to the majority’s political agenda, and further denying American auto workers the security of a viable industry that is back on its feet and ready to compete. American auto workers and their families deserve better.
12/10, 2:20 PM
posted by:
t-ak-box
I agree the Volt is a great step forward in Technology but its not for everyone. GM needs something more mainstream like Ford has as well as the Volt.
12/10, 2:42 PM
posted by:
bigjimid
Borat, are you a UAW member? Because they are sure as hell better off than I am right now. Heck, I as well as many others deserve better way before they do.
12/10, 3:28 PM
posted by:
Borat
Of course they were better off. In order to get into UAW you had to know someone, or you had to be born into UAW family. UAW is extremely corrupt organization, but they are very well connected politically: they deliver voted to democratic party. All those votes (and membership funds that go to politicos campaign funds) yield them tremendous clout in DC.
When TV industry moved to Asia completely (there are no TV’s made in US whatsoever) nobody took notice. When textiles, shoes, home appliances deserted the country politicians did not give a crap. Now even metals are not manufactured in US (strategic material for DoD). All those industries were unionized, but none of them had as many politicians in a pocket of a single union. And we don’t know all level of corruption, yet. And we will not know until indictments start to fly (which will be suppressed by DC for at least 4 years).
Do I sound like an Union Fan? However, those union members would be better off with Ch 11 and restructuring. That would make them either to learn a new trade or learn to live within competitive industry wages. This BS called government bailout just prolongs inevitable: death of incompetent companies. Honda produces 80% of cars it sells in US right here in US. More then Big 2.6. That will not change.
12/10, 3:52 PM
posted by:
terk184
Borat for President!
12/10, 6:41 PM
posted by:
JSurfer1451
The Volt looks really Japanese in this picture, I haven’t noticed it until now though. It somewhat resembles some of the styling cues from the previous and current generation Acura TL.