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May the Chevy Volt RIP: Tesla helped kill it, but it taught GM a lot about electric cars

Key Points
  • General Motors quietly pulled the plug on the Volt last week.
  • Production will end when it shutters one of the three North American assembly plants later this year.
  • Future GM BEVs will lift some of the innovative features first used on the Volt, such as steering wheel paddles that can adjust how much energy is captured.
In this Jan. 12, 2015 file photo, General Motors CEO Mary Barra talks about the 2016 Chevrolet Volt hybrid car at the North American International Auto Show, in Detroit. General Motors told investors it plans to cut $5.5 billion in manufacturing, purchasing and administrative costs during the next three years, helping to finance a big push into autonomous cars and car- and ride-sharing services.
Tony Ding | AP

It was billed as the beginning of an automotive revolution, a vehicle that motorists could use for their typical daily commute without using a drop of fuel, but which would also avoid the severe range restrictions of a pure battery-electric vehicle, or BEV.

The launch of the Chevrolet Volt "extended-range electric vehicle" in late 2010 generated plenty of headlines and an initial surge in sales. But, despite addressing some of the original car's problems and extending its range by nearly 50 percent in 2015, sales tumbled by more than 25 percent over the past two years. And, last week, General Motors quietly pulled the plug on the Volt, ending its production run at one of the three North American assembly plants it plans to shutter this year.

"The vehicle died because it wasn't selling well, obviously," said George Peterson, head of consulting firm AutoPacific. "The number of people willing to spend extra money" for a vehicle like the Volt "just isn't that huge anymore."

Car czar

When GM's product development team, then led by legendary "car czar" Bob Lutz, first envisioned the Volt early in the new millennium, demand for the more conventional hybrid Toyota Prius was exploding. The Prius was designed to recapture energy normally lost during braking and coasting, storing it in a small battery to be reused during launch and acceleration to assist the car's downsized internal combustion engine.

While that helped reduce fuel consumption, Prius still burned gasoline whenever it moved. The Chevy Volt was seen as the next step. It featured a larger battery capable of being plugged in to draw energy from the grid. In use, the battery pack could propel the hatchback up to 38 miles in its first generation – 53 miles for the second model – while producing zero emissions. But, unlike a BEV, the Volt could keep running whenever its batteries drained by automatically firing up a small, onboard gas engine designed to serve as a generator, feeding electricity to its motors.

For most owners, there was more than enough range to cover the typical daily drive. According to GM data, the average Volt owner traveled about 700 miles before refilling the small, 10-gallon fuel tank with the original model and even more with the longer-range update.

Selling point

That was a strong selling point for those green-minded buyers offered the alternatives available at the beginning of the decade, all-electric vehicles like the Nissan Leaf — which debuted about the same time as the Volt — the Ford Focus EV and the Mitsubishi iMiEV, which could barely manage 100 miles per charge.

But the competitive environment began to change once the first long-range BEV models, such as the original, 200-mile Tesla Model S, came to market. A flood of similarly long-range models are now charging into showrooms, including not only the Hyundai Kona EV, the Nissan Leaf Plus and Chevrolet's own Bolt EV.

The second-generation model "should've been an SUV," said analyst Peterson, staying in step with the dramatic shift reshaping the American marketplace. Sport and crossover utility vehicles now account for more than half of new vehicle sales, a radically different equation from 2010.

CrossVolt

In fact, Chevrolet developed a crossover version of the Volt, showing off a concept car dubbed the CrossVolt in 2010 that was scheduled to go into production by mid-decade. But the project was scuttled by former GM CEO Dan Akerson in 2010, according to Sam Abuelsamid, a senior analyst at research firm Navigant.

"If they had done the CrossVolt they might have had just the right vehicle for the current market," he said.

Likely driving the nail into the Volt's coffin was the sharp plunge in fuel prices since the plug-in hybrid first came to market. That is a factor also blamed for the sales struggles of the once wildly popular Toyota Prius.

Financial loser

Despite its demise, not everyone sees the Chevrolet Volt as a failure, however. "While it was a financial loser, it did what was intended," the now retired former GM Vice Chairman Lutz, told The Associated Press. "We viewed it as a stepping stone to full electrics, which were totally out of reach due to the then-astronomical cost of lithium-ion batteries."

In late 2010, GM was paying almost $1,000 per kilowatt-hour for lithium-ion batteries, a hefty penalty for a vehicle that needed a 24 kWh pack — or around $24,000 per vehicle. By the time the Chevrolet Bolt EV was launched, just over two years ago, that had fallen to around $150, confirmed Mark Reuss, who now serves as both GM president and its global product development chief. So, Bolt's 60 kWh battery pack costs the carmaker less than $10,000 and can manage 238 miles per charge.

Going forward, that downward cost spiral has convinced GM to shift away from plug-in hybrids and focus on all-electric models like the Bolt and the long-range Cadillac SUV the brand previewed last month, said Katie Minter, lead spokesperson for the Detroit automaker's electrification program.

All-electric future

Indeed, Mary Barra, GM's current CEO, last March outlined what she described as "a path to an all-electric future," with about 25 BEVs due to market by mid-decade.

This shift in focus doesn't mean Volt was a failure, agrees Stephanie Brinley, principle auto analyst at IHS Markit. "GM learned a ton from Volt in terms of technology that they have applied to the Bolt EV" and other long-range battery-electric vehicles to follow, she said.

The little plug-in also taught the company a lot about what consumers want, added spokesperson Minter, starting with the fact that they don't want to sacrifice interior space, comfort or performance, but "want their electric vehicle to drive just like a regular vehicle."

Future GM BEVs will also lift some of the innovative features first used on Volt, such as steering wheel paddles that can adjust how much energy is captured by the car's regeneration system during braking and coasting. When turned up high, motorists can manage slowing, and even stopping the car without taking their foot off the throttle in many situations.

Expect more hybrids

While GM has decided to get out of the plug-in hybrid electric vehicle game, the technology is far from dead. If anything, there is a flood of new models coming to market. Audi plans to unveil four of them at next month's Geneva Motor Show, alongside a new all-electric model, the Q4 e-tron. Mercedes-Benz has almost a dozen different plug-ins available worldwide. And BMW is developing a new vehicle platform that will allow it to offer conventional hybrid, plug-in hybrids or all-electric options for all future models.

Meanwhile, GM's crosstown rival, Fiat Chrysler, announced Tuesday that it will add at least four plug-in hybrid Jeep models over the next several years.

Cheaper batteries should help those manufacturers enhance the appeal of the technology and they're betting that many buyers will still appreciate the idea that once their batteries run down they'll be able to keep going without the hassle of lengthy charging.

The Chevy Volt may be gone, but it helped set the stage for what is expected to be rapid growth in the electrified vehicle market over the coming decade.