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Chevrolet's Volt Sales Running Low, GM Idles the Line

Friday, 2 Mar 2012 | 5:02 PM ET

Chevy's electric car, the Volt, is running on empty. With sales lagging and inventories building, GM has decided to idle production of the Chevy Volt for five weeks. During that time, about 1,300 workers will temporarily be laid off.

2012 Chevrolet Volt Electric Car
Source:
2012 Chevrolet Volt Electric Car

GM executives can not be happy that this move will once again raise questions about the viability and long term prospects for the Volt.

But in reality, they had no choice.

Volt sales have been so slow this year, the company needs to adjust production to demand. And so far, Volt demand has fallen well short of original expectations.

Back when GM launched the Volt, it boldly targeted sales of 10,000 in 2011 and 60,000 in 2012. Last year, GM sold 7,671 Volts and just 1,626 this year.

Why have sales been slow?

Some of it is due to the slow ramp up in sales last year. While the entire country saw ads for the Volt, the car was sold most of the year in select markets. Then the controversy and investigation into Volt battery fires left a cloud hanging over the electric car.

But the biggest factor may be the price of the Volt. At $33,500, the Volt is not cheap. Yes, for that price owners can get impressive mileage and pay a fraction what others are paying for gas. Still, with 22 models for sale offering at least 40 MPG, a lot of buyers looking for fuel efficiency are content to buy a hybrid or gas powered car for well under $30,000.

Ironically, this shut down comes as gas prices are soaring. This is exactly the time when an electric car should be an easy sell. That's clearly not the case with the Chevy Volt.

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___________________________ Questions? Comments? BehindTheWheel@cnbc.comand Follow me on Twitter @LeBeauCarNews

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  • Phil LeBeau is a CNBC auto and airline industry reporter based in the Chicago bureau and editor of the Behind the Wheel section on CNBC.com.

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