Recent reports find that General Motors (GM) is lobbying for the passage of legislation by Michigan Senator Debbie Stabenow that would turn a $7,500 electric vehicle tax credit into a rebate that will be available to all consumers at the point of sale. It's been dubbed "Cash for Clunkers II".

Right now, the $7,500 tax credit can only be redeemed at the end of the year when taxes are filed, and are applicable to purchases of the Chevrolet Volt. Apparently, Chevy is not pleased with its sales -321 units sold in January and 281 in February - out of 30,000 cars made for 2011, and a planned 45,000 to be made in 2012.

At that rate, just 3,600 of the cars will be sold this year, 12 percent of the supply. Will the additional 45,000 even run off the assembly line?

The asking price of $41,000 for the Volt, or $33,500 even with the tax credit is the likely culprit for the poor sales. Plus the fact that the car can only go 100 miles before needing to be recharged hardly makes it an attractive investment. Put simply, consumers are being asked to pay more for something that is of less quality.

That alone might explain why GM thinks the current tax credit is insufficient. But it's only half the story.

Since GM's initial public offering in November, the government sponsored automaker has been desperate to boost overall sales on a monthly basis. As such, GM boosted buyer incentives for the past four months. GM's incentive spending averaged about $3,663 per vehicle in January, and $3,732 in February, more than $1,100 over the industry average.

According to the, "That's increased GM's market share - albeit at the expense of image, resale value, and even company profits - oddly, at a time when most other automakers have admitted that such a strategy doesn't make long-term business sense."

So, in March the additional spending incentives came to an end, with GM announcing that it would be returning buyer incentives to the industry average. Unfortunately, according to MSNBC's Dan Carney, "the word in the industry is that sales slumped in March once the incentives expired."

That does not bode well for GM. Apparently, the only thing keeping sales figures up has been massive buyer incentives - which, considering the U.S. Treasury's 33 percent stake in the company, are effectively another form of government subsidy.

So, they can't keep giving the incentives out because they are destroying what it left of the GM brands and it is becoming increasingly hard to hide the fact that they are losing on each car because they are, in effect, rebating back their profits to consumers in order to move the metal.

So, they have had to cut the incentives, tank the sales and now are throwing the ball back into Barack Obama and Congress' court with Cash for Clunkers II to boost sales of the Volt. They are hoping that Uncle Sam cutting a $7,500 check at the point of sale will make a difference.

Whether it would or not, this just another bailout for GM - better known as Government Motors - and the UAW that helped to bring the company to its knees in the first place. If the Chevy Volt cannot be sold on its own in a profitable manner in the marketplace, then taxpayers should be under no obligation to give GM corporate subsidies for an inferior vehicle.

Robert Romano is the Senior Editor of Americans for Limited Government.

(29) comments


Mr. Romano, please research the facts!

1) Chevy Volt production planned for 2011 is 10,000 units, not 30,000.

2) Volt sales in March were 600, a more than 50% increase over February and much closer to the 800/month target for 2011.

3) "the car can only go 100 miles before needing to be recharged" is INCORRECT. That applies to the Nissan Leaf and NOT the Volt. The Volt has an ICE and can continue to drive when the battery is discharged.

4) You stated "the word in the industry is that sales slumped in March once the incentives expired." The truth is that GM sales INCREASED by 10% in March over the prior year. Nothing to celebrate but hardly a disaster.

5) You stated "considering the U.S. Treasury's 33 percent stake in the company, (incentives) are effectively another form of government subsidy". Obviously, you do not understand economics. Incentives by GM are NOT paid by stockholders.

Again, please do your research, collect facts and consult experts where your own understanding is lapsing. It's called 'journalism'.

wes alderson

Hi Mr, Facts!

Your comments are accuraate, of course. Thanks for stating them. Actually, though, Mr. Romano is not a jornalist as much as he is a member of the Conservative Governemtn Movement. He is not used to researching data, and maybe we can cut him some slack for trying to do a good job.

norman chalmers

Mr. Romano please. This is none of Wes Alderson's business. All you need do is transfer the manufacturing facilities to Salt Lake Cith and place them under the care of the Church, and all we be well.. The Kingdom can be Chevrolet's to share and yours too.
Faith, Hope, Good Works.

john doe

Big turn-off for me was the price gouging at the dealership. In the typical fashion the government gives a $7500 tax credit (which some qualify for) but the greedy dealers snatch that for themselves. Not sure how this would change much if it was a rebate instead of a tax credit. I'm sure folks would buy more if they weren't being hit on the head with this greedy price gouging for an already expensive car.



They weren't selling as expected, period!! It was a 'forced into the market' vehicle that no one wants. A bailout won't boost sales. Selling real and quality vehicles will, however.


wes alderson

Mr. Doe, what is the profit margin which a car dealer should expect in order to sell cars of any sort including Volts, and earn enough money to pay the rent on the showroom and lot and to pay his salesmen and stafff and everybody's health insurance and Social Security charges???

Just curious here - do you know what GM charges the dealers for this car? Please look into these questions and let us know so we can analyze whether this is greed or just the dealers' attempt to pay the overhead and stay in business.


john doe

Hi Wes,
These questions are the reason we have mandatory sticker prices shown on each and every car. As the cars all list the MSRP then when the dealer asks for between 5k to 10k over the MSRP we know how much we are being gouged.
For educational purposed here is the info on the requirement/law:
The Monroney sticker — as it is called in the auto industry — is named for the late Almer Stillwell "Mike" Monroney, a senator from Oklahoma who sponsored the federal Automobile Information Disclosure Act in 1958. This statute requires that a sticker be affixed to the side window or windshield of every new car sold in the United States. While the law does not specifically mandate Monroney stickers for some trucks, automakers affix them across their entire vehicle lineups. Failure to display one can result in a fine of $10,000 per vehicle to the dealership.


Figure the average dealership mark-up is between two and four times what it pays for the cars, though they are usually bought on a 12-month loan. That's why they can 'afford' the model-year-end sales without losing money.

Find a dealership that will show you the bank note on the car you want, and you have LOTS of room to negotiate.

I have a friend who did just that. He drove away from a car lot in a brand new car, paying only $17,500 for a $32,000 car. The dealership still made profit, and the salesman still got his commission. The bank note showed the dealership as having paid just over $8,000 for it from the manufacturer.

That Volt probably costs the dealership $10.



Camulos! That's is amazing. I am astonished. Live and learn for me.

norman chalmers

Mr. Camulos, Mr Alderson, Mrs. Molly:

I am getting very tired of your criticsm of my Church, and my attempts to guide you out of your darkness into the our light. Ours is the way of the future.

You got my much loved sister put in the hospital. You will not get me. Unless you direct a public apology to me in the blog cite I will cease my postings and leave you to fend for yourselves in this bleak world.

Which way do you want the future to unfold?

Norman Chalmers.
Citizen Of The Mountain.

john doe

I believe the original intent of the rebate is to get prospective customers to buy the Volt and not enrich the dealership. If they do offer a rebate maybe they should stipulate that the car can sell for no more then the MSRP minus the rebate or the rebate isn't available.


Mr. Chalmers:

Tire as you will. I have the First Amendment Right backing my criticisms.

Your attemts at "guiding me out of my darkness" are based on your assumptions and the fradulent teachings of your church that would put such thoughts in your head. To guide me into the 'light' of your church is akin to guiding a moth to a flame.

Yours is, perhaps, the way to your future, but not mine, nor that of the billions of others with a different perspective on things.

You have yet to prove that any of us are responsible for yoru sister's ill health.

I will direct no such apology. I do nothing I regret, and regret nothing I do. So cease and desist, if you must.

I have been fending for mself for decades without the assistance of the likes of you, and venture that I will make it many more under the same condition.

A little to the right, if you have such control.



"I believe the original intent of the rebate is to get prospective customers to buy the Volt and not enrich the dealership. If they do offer a rebate maybe they should stipulate that the car can sell for no more then the MSRP minus the rebate or the rebate isn't available."

The intent of the rebate is to sucker buyers in. Period.


wes alderson

John Doe's post is solid, concrete, and down to Earth. I agree that the dealers should consider this, but let's keep in mind the fact that they have to make payroll and pay taxes and ret etc.

ALSO - I just learned from a friend that the Chalmers Clan have been making posts in my name. Do not be fooled.

(424) 238-5178.

wes alderson

Man h Man! I love the post by Camulos, and the posts by Che on other strings. Thank you Camulos for not agreeing to apologize to the Chalmers Clan for simply telling them the truth.

They have gone so far as to fake posts in my name. Is there a family gene that is causing mental illness? Should Norman Chalmers join his "much oved sister" inthe hospital? What does he mean by "much loved?"

What sort fo hospital is it?

And more than anything else, is it possbile, due to the weird laws along the Utah Border towns, that Norman Chalmers is both the husband and the brother of Ruthie? Sounds disgusting. Is it possible?


If your going to write a letter to the editor as a representative of a limited government group, you should at least get your facts straight. You give yourself and the organization you represent a black eye when you write a "hit piece" that is filled with intrue statements.

By all means, if you don't like the government bailout of the Auto industries, nor the rebate program for these vehicles then that is a legitimate argument. However, please back up your reasoning with the truth.


"I am getting very tired of your criticsm of my Church, and my attempts to guide you out of your darkness into the our light. Ours is the way of the future."

Norman, you aren't going to win any converts posting statements like this. All you're doing is reinforcing every negative stereotype about Mormons being narrow-minded, arrogant, and unable to tolerate any criticism. Which is unfortunate because most Mormons I have met aren't like this, but it seems you are. Might be time to turn the other cheek like Jesus preached instead of getting all defensive.

norman chalmers

All right. Okay. Mr. Realist has joined with our other adversaries and he will pay the price in judgement a long long time from now. I have had it up to here in this rampent condemnation of my Reiligion. Henceforth and forevermore I will refuse to participate in the White Mountain Independent Blogger Site. I am also cancelling my subscrition to the printed edition. Farewell.

wes alderson

Thank you, Realist. Several of the best allies I ever had in my forty year business career were Mormons. Probably this was because we shared values, ethics, and morals, and worked together for the good, and did NOT try to recruit each other into any specific religion.

This is true on our Mountain also. I enjoy my friendshipss with members of LDS because we work for the common good of all.

It is by the closed-minded raves of individuals like this Chalmers, and their attempt to draw EVERYTHING including auto production and government into their church that aleinates others. In fact as Realist points out, it defeats their own cause.

Mr. Chalmers stated elsewhere that he was withdrawing from this blog site because he feels persecuted. Yet it was his own comments that brought down the ire of others on his head. May I please suggest that we ALL stay within the limits of good manners and good ethics in these exchanges?

I am guessing that many other people on this WMI blog site will be happy to see Chalmers withdraw as he threatens. As for me, I like everybody to state their views, but within that limit of good manners.


Mr. Chalmers, your hypocrisy is appalling. You say everyone is condemning your religion, but when you say "guide you out of your darkness into the our light. Ours is the way of the future," you are condemning what others believe. You obviously love your religion, but hate the freedom this country offers. Go ahead and take your theocratic nonsense elsewhere, you will not be missed.


Told ya he'd post again...



The retail auto business is generally a volume-dependent enterprise. On a very broad front, markups (not profits) average between 5-10%. Some models such as SUV's have markups as high as 25%. Other models, particularly new ones, are lower.

Kelly Blue Book show the MSRP for a 2011, standard four-door Volt at $41000 with an invoice charge of $39388. For the Nissan Leaf: MSRP=$33360 and invoice=$32244. These invoices are, of course, prepared by the manufacturer and should be taken with a grain of salt. The markups, on the other hand, are verified by independent research.

Motor Trend reports a worldwide waiting list of about 50000 for the Volt as of 2010.

The real money in the auto business comes from maintenance and financing.

I agree that the Volt is priced out of the middle class market. The recession has not helped either.

wes alderson

So Camulos, even if we try to be kind, such as what you, Realist and I have said, why is he burdening this great discussion of Automobile Economics with religious issues? A car of any kind drives the same for a Mormon as it does for a Lutheran like me.

Welcome back RonZim - we missed your sanity. We hope all is well with you.


Wes -

He prefers a 'Lectric Driving System...


"...joined with our other adversaries..."

What "other" adversaries?

What "adversaries"?

Has "norman" come to wage war or some other type of battle? Most Christians consider members of other Christian-based faiths as 'brothers and sisters in the Lord', and Satan is the "adversary". Christ never even refered to peoples of other beliefs as "adversaries". I think Joe Smith had plenty of "adversaries", however...

Thanks for the lesson in the LDS mindset, "norman".


wes alderson

Camulos? It's been nearly two days now and the "Zealot" has not posted anything. Due to the destructive nature of his efforts to force his religion on the rest of us, let's hope we have seen the last of that. Obviously, he and anybody is free to post, and you and I are not the Internet Cops . . . but I was getting awful tired of being hammered at about why I was wrong simply because of my own Lutheran religion.

I also urge caution - he is one of those who picked up my email from my having posted it. So I have received some rather nasty stuff personally. Of course I am responsible for having posted my email, and I will probably do that again when there is some vital issue involved, such as animal welfare. But we must be prepared for the fact that some rather odd people can get hold of our info that way.


Maybe the chalmers are not LDS but in fact haters who wish to misguide others to think that the LDS are,...whatever you would call what the chalmers are.[sad]


AzisGr8 -

I am of the opinion that BOTH chalmers are, in fact, one and the same, and someone who posts here regularly.

I also believe that individual to be an LDS member with a very narrow view of his/her own religion of choice, and an extreme misunderstanding of said religion.

I also believe that individual of really, earnestly believeing what he/she spouts with regard to said religion.





Didn't the government already "bail out" (I mean, PURCHASE) GM, which was considered "too big to fail"?

What happened - did they shrink?


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