General Motors reported unimpressive sales results for the month of September as sales fell 11%. Core division, Chevrolet, performed the worst with sales down almost 15% year over year. Within that division, sales for the much-hyped Chevy Volt could not even be propped up with its recent $5,000 price cut as results declined to a measly 1,766 units (less than one per dealership) in September. That is a decline of over 38% year over year and just over half of what sold in the previous month.
NLPC has reported regularly on several of the large-ticket boondoggles that have received taxpayer support via President Obama’s “green” stimulus initiatives, but for every Fisker, Nissan Leaf or Ecotality, there are thousands of smaller, equally unworthy beneficiaries that deserve public scorn.
Government watchdogs – both “professional” and amateur – can scour the Recovery.gov Web site and find the waste pretty easily. But KCNC-TV reporter Brian Maass had the stimulus program come to his doorstep. Denver had launched a program, paid for out of the federal American Recovery and Reinvestment Act, to plant about 4,000 trees at private residences (photo courtesy KCNC) – many in high-priced neighborhoods that didn’t need the free shade.
We now have had some time to digest the groundbreaking news from General Motors that it is working on a "Tesla-Killer" electric car that will get 200 miles on a charge and cost about $30,000. The most obvious takeaway is that the news is more unfounded green hype from GM, something that they have been guilty of in the past when they over-promised on the Chevy Volt. The best indicator of how serious a challenge to Tesla the new report really is would be found in Tesla's share price, which has gone from about $165 a share at the time of the news to the current price at around $185. While that barometer would give the indication that GM is once again exaggerating the potential for its latest green miracle car, let's assume that the technology to develop a car that goes 200 miles on an electric charge at a price of $30,000 really is not too far off.
After the Department of Energy announced this week it had given up on not-bankrupt-but-should-be Fisker Automotive, and will auction off its loan for a pittance, you’d think (and hope) Congress would have had enough of this kind of thing. Senator John Thune certainly has.
“The Obama administration has gotten into the business of picking winners and losers at a significant cost to taxpayers,” said the South Dakota Republican yesterday. “I’m calling for the Senate to consider my amendment to eliminate the wasteful ATVM loan program and for my colleagues to join me in protecting taxpayer dollars from any future risky green energy investments.”
Then in mid-August Ecotality informed the Securities and Exchange Commission it was in deep financial trouble, with bankruptcy a possibility. A filing showed that the company was unable to obtain additional financing and the DOE had ceased payments to it for the EV Project until the agency could investigate further. DOE also warned Ecotality to not incur any new costs or obligations under the EV Project.
The internet has been abuzz with stories about General Motors competing with Tesla by offering a vehicle that will get 200 miles on an electric charge and cost only $30,000. One headline even declared that GM might be the winner of the competition with the title reading, "GM Takes on Tesla- and Just Might Win." The only problem is that the car being hyped does not even exist. Nor may it ever.
Two of the most egregious offenders were subject to withering scrutiny, although it didn’t last long enough to get very deep. Lisa Jackson, the former EPA Administrator whose FOIA-evadable email address was under the alias “Richard Windsor” – named in part for her dog – was questioned about a message sent to Siemens vice president Alison Taylor in which she asked her to “use my home email rather than this one when you need to contact me directly….”
It looks like General Motors is attempting to make up for the money it loses on every Chevy Volt in volume as August sales, spurred by recent price cuts, reached an all-time high of 3,351. The fact that the car has been on the market for about three years and initial much-hyped proclamations from GM would have put sales at 20,000 per month by now goes unrecognized by those that think 3,351 vehicles is a lot of cars to sell in a month. To put the sales in perspective, it took Toyota about 2 ½ days to sell that many Camrys with August sales coming in at 44,731. Fortunately for taxpayers, Volt sales are nowhere near those figures. The 3,351 Volt sales came at the expense of over $25 million dollars of federal subsidies.
The auto industry, including Detroit manufacturers, reported strong sales numbers for the month of August. Sales for the industry rang in at pre-recession levels hitting over 16 million units on an annualized basis. While General Motors got its fair share of the wealth, one unusual tactic to drive sales stands out. That is the use of "stair-step" incentives which are paid to dealerships in the month following the reported sales.