On Thursday, I discussed disappointing Chevy Volt sales figures with Neil Cavuto on his Fox Business Network program. Here’s a transcript:
Neil Cavuto: It’s not just me. It is now official. The Volt is a dolt. You’re hearing me all you bloggers? It stinks. The car you have to plug in ain’t exactly selling out, not even close. Get this, for all of last month, 1,139 cars. That is 1,139.
Compare that to Toyota, which sold more than 23,000 Camrys in the same month: 1,139 to 23,000. And now news from GM that the Volt could be in for yet another jolt. Company CEO promising today to buy back Volts from customers worried about reported battery fires.
To a disgusted former GM bondholder Mark Modica. Mark, what do you make of this?
Mark Modica (National Legal & Policy Center): Well, I have moved on from being a disgusted bond holder to being a disgusted taxpayer, because it is the taxpayer that is getting hosed. I mean, the Volt — The demand really isn’t there. They have tried to play this off, that this was a supply issue.
But we now have over 4,000 Volts in inventory at dealerships. The common guy isn’t buying a car that’s over $40,000 for what is offered. It’s a few wealthy people out there that are buying them.
Besides the billions of dollars spent from taxpayers to produce the car and the batteries, these wealthy buyers are getting $7,500 each for buying the cars.
Neil Cavuto: And the thank you for that is they’re getting blown up. I’m kidding. I just got to wonder, at what point does GM realize, all right, this plug in ain’t cutting it?
Mark Modica: I have been wondering that for quite some time. I guess it depends when auto journalists and maybe some congressional members say what are we doing?
Neil Cavuto: They love it. You and I talk about this, but they love it. It’s like you just don’t give up on that love. You just don’t give up on it. And they are just not going to give up.
Mark Modica: I don’t know why. I don’t know why really.
Mark Modica: The proof is there.
Neil Cavuto: Right. But is the plug in thing what’s the problem? Are there others plug ins that are doing better? The Leaf, the Nissan Leaf, that is a plug in, right? Isn’t that doing OK?
Mark Modica: No. Just the technology isn’t there yet to offer these vehicles in a free market, where a company can make profit offering them. Over $40,000 for a small car that goes 30, 35 miles on a charge, and then gets about 30 miles per gallon on premium fuel.
The value is not there. People buying these seem to like them. But that’s fine. There’s no reason for taxpayers to be dishing 7,500 for a vehicle. It just doesn’t make a lot of sense.
Neil Cavuto: So you think got rid of that $7,500 tax credit, they wouldn’t be selling any of them?
Mark Modica: Well, they claim there is such high demand. If they are telling the truth, let’s take the 7,500 away. These people that love the cars will still buy them. The common guy is not going to buy them. And the big problem here, Neil, is there is no great benefit.
I have a piece out there on the National Legal and Policy Center website that discusses, if Obama reaches his EV goal of a million units on the road, four years from now, if you do the math on the oil consumption, we would reduce oil consumption by 0.15 percent in four years.
This is coming from an administration that did not want to drill for oil because it would take years to get the oil out of the ground. We are going to go years and spend billions and billions of taxpayer dollars for zero benefit. And the environmental impact of these lithium ion batteries is just now coming to light.
Neil Cavuto: All right, Mark, thank you very much. Of course, now the added indignity, the cars will kill you.
All right, there are financial cops. After hearing them today, I wasn’t quite sure if they were really the Keystone Cops.