GM halting production of current-gen Volt in May

David Shepardson
Detroit News Washington Bureau

General Motors Co. will halt production of the slow selling first-generation Chevrolet Volt next month as it prepares to build the updated version that goes on sale this fall.

The plug-in hybrid Volt has had poor sales, partly because of low gasoline prices. GM — like other automakers — has been forced to cut the prices of the Volt and offer additional discounts to boost sales.

GM has enough Volts already built to supply dealers for 210 days, according to Ward's Automotive; a 60-day supply is considered ideal.

"First-generation Volt will stop building at the very end of May to get ready for model change," GM spokeswoman Michelle Malcho said.

The Volt is assembled at GM's Detroit-Hamtramck Assembly Plant. Production of the Volt will be idled for about six weeks before production begins on the new Volt, but it will take a significant period to ramp up production before vehicles start shipping. At least the first month of production will be shipped and sold in California — around September. The plant will continue to produce other models during the period and builds the Chevrolet Malibu, Chevrolet Impala and forthcoming Cadillac CT6 among other models.

Malcho said a number of factors account for the production idling, including sales. GM has reduced production of several cars this year in the face of lower demand for the cars as it has raced to ramp up production of hot-selling trucks and SUVs. It is not unusual for an automaker to halt production of the current model before it launches the new one.

California is the Volt's largest market and accounts for 40 percent of total sales. Automakers must build a rising number of zero-emission vehicles in California to meet state requirements. In January, GM announced plans to make a pure electric Chevrolet Bolt that will get 200 miles on a single battery charge.

In January, GM unveiled the upgraded 2016 Volt at the North American International Auto Show with a new two-motor drive unit that is as much as 12 percent more efficient and 100 pounds lighter with a long all-electric range of up to 50 miles. The battery-pack capacity has been increased. It has a new gasoline engine that can use regular unleaded fuel, new braking system, and a new interior with seating for five and improved functionality.

Since 2009, GM has invested $1.82 billion in Michigan that's related to electrification and the Volt. It has several other EV projects in the pipeline. GM has also received significant federal support for building the Volt — and Volt buyers are eligible for a $7,500 tax credit.

The Volt has not met sales expectations set in 2011 by former CEO Dan Akerson, who wanted production to hit 60,000 annually by 2012. In 2013, GM lowered the price by $5,000 to boost sales. GM is currently offering $1,000 rebates on Volt purchases or discounted financing. Qualified consumers can lease a new Volt for as little as $299 a month.

U.S. Volt sales fell 57 percent in March to just 639 and are down 48 percent for the year. Volt sales fell 19 percent last year to 18,800.

In October, GM CEO Mary Barra would not give volume targets for the newest Volt, saying GM has learned its lessons from sharing overly optimistic sales goals.

Barra wouldn't comment on whether the Volt is profitable. She also declined to say whether the sticker price of the 2016 Volt would be lower.

The present Volt operates with 38 miles of electric range and gets 37 miles per gallon when operated with the gasoline engine; the next-generation model will get up to 50 miles of range and get 41 miles per gallon with the gasoline engine.