Skip to comments.GM’s New Electric Chevy Spark - More Green Insanity
Posted on 12/03/2012 10:22:33 AM PST by jazusamo
Albert Einstein is credited with having defined insanity as "doing the same thing over and over again and expecting different results." Well, prepare for more insanity as General Motors is doubling down on green energy and plug-in cars after the disappointing sales results from previous entries into the field. The politically-motivated hype that we saw, and continue to see, on the Chevy Volt will be repeated. This time the over-hyped vehicle will be a Korean-made, all-electric Chevy Spark.
The misrepresentations from GM and the media on the Spark EV (electric vehicle) are already starting with headlines on stories ( like this one from Bloomberg) boasting that the car will start at a price tag of under $25,000. Not exactly. For some strange reason, the price of the new Spark EV and the Chevy Volt are now being quoted after tax incentives. It is also interesting to note that Bloomberg quotes the competing Nissan Leaf price before tax incentives. Here is the important fact that proponents of plug-in EVs fail to grasp. THE COST OF A SUBSIDIZED VEHICLE IS NOT LOWERED BY TAX INCENTIVES; IT IS ONLY BORNE BY OTHERS.
The new Spark EV will start at around $32,000, not under $25,000 as reported. Taxpayers will pay to reimburse buyers of the vehicle (who will probably have above average income) $7,500 through federal tax credits. The Spark will compete with the Nissan Leaf, which starts at around $35,000 and the Mitsubishi i-MiEV, which starts at around $29,000. All of these cars are all-electric vehicles with electric ranges from around 70 miles to a yet undisclosed range for the Spark which will likely be closer to a 90 to a 100 mile range. The Leaf and i-MiEV have been utter failures, but that isn't stopping GM from building a new vehicle to compete with them.
The Leaf has been selling at a rate of fewer than 1,000 per month , less than half of its goal. The i-MiEV has been doing even worse. The plug-in Chevy Volt has been doing slightly better than the Leaf and i-MiEV with sales spurred by incentivized leases from government-owned Ally Financial . In addition, the Volt loses money for taxpayers and GM shareholders with every vehicle sold and the sales figures will fall far short of early GM goals. And now we will spend taxpayer money on the electric Spark to create green jobs in South Korea.
To put the EV sales figures in perspective, GM sells close to 20,000 Chevy Cruzes each month compared to average sales of the plug-ins of about a thousand or two. So why in the world is GM pushing a new plug-in EV Spark to compete in a segment that has minimal demand? The answer must be that political goals rather than economic ones are driving decisions at a company whose management team has been appointed by President Obama. The government continues to refuse to sell its investment stake in GM and, judging from the insane Spark EV focus, seems to have a say in how the company is being run.
Another way to look at the logic, or lack thereof, of the Spark EV is to compare it to the gasoline-powered Spark. The plug-in version cost about $20,000 more than the gasoline one. Of that, $7,500 will be reimbursed to buyers of the EV from all taxpaying Americans. The average motorist drives about 15,000 miles per year. The Spark EV will use no gas, thus saving about 430 gallons of fuel versus the gas-powered Spark which gets about 35 miles per gallon. So the average driver can save about $1,700 a year in gas driving about 15,000 miles a year assuming $4 a gallon gas. Subtract the electric cost for charging the EV version, which at $2 a day will be about $700. Think about this, the average driver in America will save about $1,000 a year in gas costs for an additional $20,000 spent on the electric Spark. Taxpayers pay $7,500 in federal EV subsidies (plus state credits) on each vehicle sold so that these savings can be realized. It will take about 20 years to recoup the extra money spent on the electric Spark. Is this making sense to anyone other than ideologues?
I'm sure GM and the media will not let the facts get in the way of the hype. The gas savings will be misrepresented, just as the price has already been, with the amount of gas saved inflated and put in terms ofsupertanker fulls or craploads or some other such nonsense. Sales can be spurred to promote the hoax by having taxpayer-owned Ally Financial take the hit on lease deals that make the vehicle affordable to some while the taxpayers pay through the back door. More hundreds of millions of taxpayer dollars will be lost on the tax subsidies on the vehicles. And all so that a government-owned and managed company can try to convince the masses that plug-in cars and green energy are the answers to America's energy needs, despite the clear evidence to the contrary as displayed by failures like the Leaf and i-MiEV. That is pitiful.
Mark Modica is an NLPC Associate Fellow.
Wait till Congress passes a law requiring us all to buy one. :)
It will be just like Healthcare. :)
The batteries and motor/gen apparatus could be sold, yes? Then the vehicle retro-fitted with a small engine, yes? Hmmmm.
Consider it a tax.
GM has to keep Obama happy, they might need another check.
a little bigger then a smart car and just as ugly.
This Spark is about the closest thing to a motorized roller skate that I've seen, and a very expensive one.
In a little more than 2 weeks I pack up our family of four and drive us about 1,500 miles back home for Christmas.
I don’t care how much gas money would be saved on the 3,000 mile round trip. That thing looks like a death-trap even before we get into the winter weather driving.
Made in Korea. UAW please pick up the white courtesy phone.
GM isn’t insane. Each time they sell one of these cars, it “allows” them to sell a Chevy Cruze.
It’s how they meet the federal mandate for fleet fuel economy standards. They can’t meet the numbers in real life, because the real world is run by physics that isn’t subject to the whims of the fanciful liberal mind.
So instead, they bribe people to buy these “fuel efficient” cars, which average in with their other cars to raise their fuel economy standards.
Note that every car is assumed to be driven the same amount. So they don’t care if you ever use the electric car, just that they sell it. In fact, most people who have electric cars drive them less; not a bad thing perhaps — these people are the kind of people who would drive less because it’s good for the environment to do so. But it means that the whole process is flawed.
You sell a 20-mph SUV, and one of these electric cars that maybe are considered infinite mpg vehicles (Volt had an EPA number, I don’t remember if the leaf did or not). A car that uses no gas, averaged with teh 20-mph SUV, gives you a “fleet average” of 40 mpg. But the SUV gets driven 20,000 miles a year, the electric car is used for short commutes and drives maybe 8000 miles per year. So in fact, you might have raised mpg to 24 or 25, not 40.
We don’t have a free market making decisions for automobile manufacturers, because they have to meet this fleet standard.
But the big car manufacturers do like these standards, for one big reason — they pretty much lock out any new car companies. See, if you have billions of dollars of taxpayer money, you can throw it away on electric cars, sell your big SUVs, and hit the fuel standards.
If you wanted to start a new company, you’ll make ONE car. That ONE car has to meet the standard, so it has to be a small car, which people don’t want to buy . You can’t subsidize it to get it sold, because you don’t have a gas-guzzler that people WILL buy. So, the big three “reluctantly” accept government regulation that gives them a lock on the market.
There’s a reason all the upstart companies are making electric or alternate fuel vehicles — it’s the only cars they can make under regulations (they also can get some of the taxpayer dollars, so in the end it’s a big tax avoidance scheme).
Which is the other big thing. Rich liberals don’t mind getting their income taxes raised, because they’ll still get deductions and tax credits when they invest their money in these green alternate companies. They don’t care if the companies go under, because they invest in order to cover their tax liability.
That’s why they won’t allow the removal of deductions. The liberals fight that, because they use deductions to reward their voters and to force people to do what government wants.
Perhaps Bronco Bama and his retinue could use this car on their $4million dollar vacation this month to Hawaii.
I believe these cars would be a complete bust without the tax credits.
Wasn’t the Ford Pinto originally called “The Spark”? Or am I just thinking of the early Chey Volts that caught fire and burned to the ground?
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