Here’s today’s Trifecta from PJTV!

According to a recent report, General Motors is losing big money on the Chevy Volt, as much as $49,000 per car. Why has the federal government invested in General Motors, and why is the Pentagon stocking up new Chevy Volts? Find out as Tammy Bruce joins Trifecta.

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  1. Maynard says:

    I’ve pointed to the Volt before. See my previous post, “Why the Volt?”.

    The Volt follows in the footsteps of the earlier GM moneyloser, the Impact.

    Programs like the Volt or the Impact come about only as a result of political pressure. They solve no problems, and in fact merely squander resources. Eventually they vanish away, always with a few acolytes wailing loudly, and darkly blaming their sinister political opponents for “killing” their darling. These cult members manage to skip over the obvious fact that practically nobody wanted these vehicles, even with a massively subsidized purchase.

    In this case, GM claims the $49,000 subsidy figure unfairly takes into account development costs, which should properly be amortized over the life cycle of the vehicle. There’s a general truth in that claim; it’s proper accounting to amortize start-up costs. But there’s no denying that the Volt is a political animal, subsidized in every step of its manufacture and sale, and further incentivized with local goodies such as carpool lane privileges. For example, the Dept. of Energy arranged for sweetheart loans to a Korean company, about $151 million, to build a battery plant in Michigan. If the Dept. of Energy did this, it’s because no sane bank would do it. Because the economics don’t work. So our tax dollars go to the Koreans, and a few people get employed, and Obama gets his picture in the news. At the end of the day, we have more debt, and an infrastructure tooled to produce nothing but a toy car for yuppies, and the Chinese continue to eat our lunch.

    Can I make a confession? I’d actually like to buy a Volt. If I had an extra $20,000 to blow, I’d do it. (I figure a Volt costs that much more than the car I need.) I think of it this way: For maybe $35,000 out of pocket, I could get a $100,000 car. And it is indeed a neat car. I’d love to plug it in and never visit a gas station!

    Jokes of catching fire aside, the problem with the Volt isn’t that it’s bad. The problem is that it makes no economic sense. Even with massive subsidies, it costs twice as much as the competition. You’ll never make that up in energy savings. And it does no good for the overall economy or our energy outlook; we wasted too many resources to build it.

    • Alain41 says:

      Agree except it makes economic sense if gasoline is $15/gallon.

      The gov’t wouldn’t have stopped gulf coast oil drilling, putting more lands offlimits for exploration, not approving Keystone pipeline, getting together its EPA story to ‘make fracking safe’ (eg, none allowed), etc. without that as a result. Maybe it’s not a goal, but the possible result bothers no one currently in administration.

      As long as there is a free energy market, then the Volt makes no sense. The gov’t is working very hard to make a free energy market disappear.

    • strider says:

      20K subsidy would probably cover the cost of losing all the toxic rare earth battery junk and dropping in a 427. Make it a Chevy Jolt.

  2. Maynard says:

    Oh, yeah, and of course the reason the government won’t sell that depreciated GM stock is that then the loss of many billions of dollars is on the record. Until the sale happens, the fiction stands that the bailout was other than a money pit.

    • Alain41 says:

      Agree except it makes economic sense if gasoline is $15/gallon.

      The gov’t wouldn’t have stopped gulf coast oil drilling, putting more lands offlimits for exploration, not approving Keystone pipeline, getting together its EPA story to ‘make fracking safe’ (eg, none allowed), etc. without that as a result. Maybe it’s not a goal, but the possible result bothers no one currently in administration.

      As long as there is a free energy market, then the Volt makes no sense. The gov’t is working very hard to make a free energy market disappear.

  3. aardvark says:

    Since the only part of the US budget being cut is the military’s (about 25%), why on God’s green earth are they being forced to spend precious limited funds on this lemon/timebomb? Oh, I just answered my own question — God’s GREEN earth — another social engineering job for a military that has been re-purposed. Thanks, Barry. As a military retiree, we are directly impacted by the cuts. The Creep-in-Chief is deliberately trying to FORCE dependents and retirees OFF military insurance (that they sacrificed and served to EARN) and onto ObamaCare. Rates are tripling over the next 3-5 yrs. Co-pays are going up (pharmacy co-pays upped 75% last Oct.)…and we’re buying Volts.

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