EV price war erupts as GM cuts tag of Chevrolet Volt

Article by Anita Panait, on August 12, 2013

There is now an ongoing battle between carmakers in the electric vehicle segment – a price war! One by one, carmakers are offering discounts on the prices of their offerings, making electrified vehicles more affordable this year than in 2012. It all started in January 2013 when Nissan Motor Co. cut the sticker price of its Leaf electric vehicle by around $6,400.

That resulted to higher sales and other carmakers followed suit, particularly Ford Motor Co. and Honda Motor Co. The price cuts made by these carmakers have left General Motor’s electrified offering, the Chevrolet Volt plug-in electric vehicle, as the priciest mainstream plug-in EV. The Volt has a sticker price of nearly $40,000 sticker price, which does not look appealing enough for people who know they could get a Toyota Prius for a significantly lower tag of $25,010 Toyota Prius.

GM posted a 3-percent drop in sales of the Volt in July, and bared last week that it would trim the price of its plug-in offering by $5,000. This effectively dropped the price of the Volt to $34,995. Jeff Schuster, an analyst at researcher LMC Automotive, remarked to Bloomberg that the EV segment is having “a competitive nightmare,” which forces carmakers to play “within the realm of what others are doing." He noted that, although price war is no longer occurring in the auto industry’s volume sector, it is “alive and well” in the EV segment.

There has been concern that the price war would explode on a larger scale since the Japanese yen started depreciating October 2012. The yen has dropped 18 percent since October 2012, and has been giving Japanese carmakers an extra hand to cut prices while protecting profits. Nissan has trimmed prices of seven models in the United States, while Toyota is offering no-interest auto loans. Toyota also posted a record quarterly profit of $5.7 billion.

At the very core of Chevrolet’s Volt is the Voltec propulsion system. This system joins together an efficient, range-extending engine and pure electric drive, giving the car a range of up to 350 miles.

The car’s long-lasting battery consists of a 198.1-kg, 5.5-foot 16-kWh T-shaped lithium-ion battery pack, which supplies energy to a 149-hp electric drive unit in order to propel the car. The Volt uses only the energy from its battery to deliver between 25 and 50 miles of electric driving that is tailpipe emissions-free and without the need for fuel.

Additionally, the Volt’s battery is designed to give you performance, value, quality, durability, reliability, and safety. What’s more, it is also covered by an 8-year/100,000-mile warranty. GM’s engineers have already completed over four million hours and a million miles of Volt battery pack validation testing since 2007, including the 288 prismatic cells and nine modules for each pack. The teams in charge of the development, validation and testing have met countless specifications and have validated each of the battery’s 161 components, of which 95% had been engineered and designed by GM.

According to Mickey Bly, executive director for GM’s global electrical systems, consumers are committing to technology that would help them reduce dependence on petroleum, and the company, in turn, promises to give customers the highest standards for performance, safety, quality, reliability, and value.

The Volt smoothly transitions to its extended-range mode when its battery’s energy is depleted. It inverts power from its 1.4-liter 84-hp gasoline-fueled onboard engine to its electric drive unit to deliver up to 310 miles of additional range.

Chevrolet Volt proves that electric driving is spirited. Not only does it reach a speed of up to 100 mph, but its electric drive generates an excellent low-speed torque of 368 Nm or 273 lb.-ft., taking it from zero to 60 miles per hour in less than nine seconds.

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