General Motors' Chevy Volt Model Sales Soar in 2012

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Researched by Industrial Info Resources (Sugar Land, Texas)--General Motors Corporation (NYSE:GM) (Detroit, Michigan) saw sales of its Chevrolet Volt plug-in hybrid vehicle model rise in 2012, due to an increased demand for low-emissions vehicles. Since its initial production in December 2010 at the Detroit-Hamtramck assembly plant, GM's Chevy Volt model has been considered the most fuel-efficient compact car in the U.S. The Volt operates as a dual-fueled vehicle with an electric engine, which works until the batteries run low, at which point the internal combustion engine kicks in and operates the vehicle while the batteries recharge. This duel-powered capability has enabled the Volt to gain popularity, as its range is significantly longer than its pure electric cousins.

GM sold more units of the Chevy Volt in 2012 than in the previous year, in part thanks to help from California's state legislature. California passed laws allowing owners of electric vehicles to use car-pool lanes and added a $1,500 state rebate on top of the $7,500 federal tax credit for purchasing an electric vehicle. As a result of the incentives offered, more than half of the 2012 Volt sales in the U.S. were in California. The state also has the luxury of an infrastructure that is friendlier to the recharging of electric vehicles, which has helped sales as well.

In 2012, GM sold roughly 23,461 Chevy Volts, compared with just 7,671 sold in 2011. Even though the Volt is still one of GM's lowest-selling cars, it outsold the Corvette, which only saw sales of 14,000 in 2012. In July alone, GM sold approximately 10,666 Volts, which more than tripled the 2,870 Volts sold during the same time period only a year before. GM is hoping that increased interest in electric and "green" vehicles, as well as a second term for President Obama, will help to boost sales in 2013. Given that green initiatives are high on the administration's priority list, this should be a solid bet for GM.

GM is gambling on an increased interest in electric vehicles, especially the desire for larger ones, and is undergoing a $35 million expansion of the Detroit-Hamtramck assembly plant in order to begin production of the battery-powered Cadillac ELR. Retooling for the new Cadillac model began in December 2012 and is expected to be completed by the end of 2013. GM is anticipating the sale of the new Cadillac ELR plug-in electric luxury coupe to start in early 2014. GM has invested heavily in its Detroit-Hamtramck plant since 2009, investing $561 million at this facility alone to promote new vehicle production. However, sales have not always lived up to the vision of GM's leadership. The plant was closed from late March to late April 2012 as production was outstripping sales. The plant was also closed from September 17 to October 15, as it was retooled to begin producing the new Impala.

While the Volt and all other electric vehicles are not exactly setting the world afire in sales at this time, there has been a steady increase in sales from year to year. Couple that with oil and gas prices that remain above $3 per gallon and are not showing any signs of dropping in the near future, and sales of these types of vehicles are expected to only increase through 2013. It may be a number of years before electric vehicle sales are a major portion of GM's total annual sales, especially given that no acceptable electric pickup trucks or large-capacity cars have been successfully developed as of this point, but GM is betting that sales of electric vehicles eventually will be a force to be reckoned with in the market place.

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