How much?

So I've talked about the Chevy Volt before and how I thought it was going to be the first practical series hybrid that people could actually buy. Well Bob Lutz, GM's Vice-Chairman, as said publicly that the Volt's price could be as high as $48,000. Say what? Originally it was $30K then $35K and now it may skyrocket to $48,ooo!! Sorry, but at that price it will not sell in any significant numbers and end up a lame duck from the start. The only way it will sell is if the government offers SERIOUS tax incentives/benefits to purchasers which is not likely to happen and doesn't work very well any way. At that price the fuel savings would take 23 years to pay for the $28,000 price premium over an average 30mpg car that costs around $20,000.

Kind of related to that are the comments that Jim Press, current President of Chrysler, made in relation to hybrids and fuel economy. Press claims that the Japanese government funded the development of the batteries and "Hybrid Synergy Drive" systems in Toyota's Prius. And how does Jim press know? He used to be President of Toyota's American operations so he's probably a guy that knows a thing or two. Of course Toyota denies it but who do you believe?

So why does that matter and what does that have to do with the Chevy Volt? Simple, since the Japanese government footed the bill on most of the Prius development cost that meant that Toyota could sell them cheap without taking a huge loss on each car. General Motors is paying their own way with the Volt which means that it will either cost way more than a Prius or GM has to take a big loss on each one sold in order to compete. Somehow I don't think that, given the current financial situation of General Motors, they can afford to lose money on anything.