No touchdown dance for the Chevy Volt at the Super Bowl
Did GM misjudge Main St. and the Toyota Prius?
Years ago, before the debut of the Chevy Volt concept, but as rumors emerged that GM was aiming to take on the Toyota Prius, I claimed that a GM-like-Prius would be even more successful than the Prius. An American-made Prius would be a true freedom fighter, a US manufactured attack on foreign oil dependence. In fact, I argued that GM could build a whole marketing concept around this freedom-fighter vehicle.
While some might argue the Chevy Volt is a such a vehicle, data coming out of the Super Bowl, suggests otherwise.
According to Carwoo.com data, GM’s Chevy Volt Super Bowl commercials had no impact on the Volt. There was 0 positive lift.
The Volt just isn’t resonating with most Americans, particularly those on Main St. Much of that is politics, of course, but 0 lift? Not everyone watching the Super Bowl is a gun rack toting, redneck American.
Sadly, I think the Volt is facing far more serious problems, as are most plug-ins.
Of course, I don’t think GM expected to resonate that much with Main St. at this point in time, at least in terms of sales. For Main St., the Volt is a halo product until costs can be drastically reduced. Bob Lutz, the co-father of the Volt along with Jon Lauckner, regularly admitted to the limited sales potential of the Volt in the interim to better batteries. He even suggested that would be the case until at least some time in the ’20′s.
So, did GM make a mistake trying to leapfrog the Prius?
That’s hard to say just yet, but did GM and the rest of the US auto industry make a mistake passing on hybrids — a technology almost perfected here in the US in the 90′s — when they tried to leapfrog them with fuel cell vehicles? Had GM kept its NiMH patents and beat Toyota to the Prius — as it could have — would it have been easier to survive the financial meltdown and gas crisis of 2007 -2008?
While some say the collapse was just a financing issue, I did a lot of car shopping back then. As gasoline prices rose, it was striking how dead GM dealerships were compared to Toyota — a subject I wrote about back in those days. Certainly, hybrid cars probably wouldn’t have been enough to save GM, but I think they would have helped.
Nevertheless, at less than 3 percent marketshare, hybrid cars really haven’t mattered much beyond perception. Obviously, for Toyota, massive patents have been filed and serious steps towards a viable and cost-effective fuel cell hybrid have been taken. But Toyota has neither been made nor broken by hybrid cars, yet.
With gas prices rising, however, hybrid cars will — should — become much more compelling, especially with even cheaper hybrids like the Prius C reaching the market. Hybrids are becoming a cost-effective way for consumers, especially urban ones — and the future of transportation — to respond to rising energy costs, without really giving up anything.
At $5.00 per gallon, the Prius makes a ton of sense, and it could make great sense heading well into the ’20′s. Plus, the Prius requires no charging while offering incredible range. It only asks consumers to pay a little extra upfront, to save a lot down the road.
But gas isn’t yet at $5.00. So a mass consumer rush to the Prius and hybrids might never happen. And, aside from higher gas prices, a further price reduction is probably also necessary, although I’m not sure about that last statement if gas prices stick at $5.00 for some time.
Even at $5.00, however, such a rush to the Volt is only possible with significant tax credits. Plus the the Volt offers less range and requires regular plug-ins to ensure cost-effectiveness — something at least 50 – 60 percent of consumers aren’t even capable of doing today due to a lack of off-street parking.
So, was the Volt a bad idea?
Long term, I don’t think so, but only time will tell. If Toyota’s Prius forecasts through this decade hit their marks, then I’d say not extending the Volt into a family that also included a non-plug-in, as well as a plug-in version — as Toyota is doing with the Prius — was a serious mistake.
If Detroit has been plagued by one bad tendency, it’s been doing as little as necessary to change in the interim, while waiting for some revolutionary, game-changing shift, as it’s been doing now for decades, although there are some signs Detroit has seen the light. Nevertheless, Toyota’s kaizen-based philosophy, on the other hand, is more like Bob’s psychiatric treatment in the movie What about Bob. It’s progress based on “baby steps” or methodical, constant progress.
Sometimes, waiting for the big change is nothing more than an excuse, an unhealthy form of procrastination. And in the last decade, the Prius has come a long way. Had Toyota copied the Big 3, would there even be a hybrid or plug-in available for sale today?
Inevitably, the Volt is dependent upon major technological transformations, particularly much cheaper battery costs. Even if such a breakthrough is achieved today, it will still take a long time to scale such changes into the battery industry according to most experts. Of course, such a breakthrough could take much longer to achieve, then scale. And there is also the possibility of shocking, unexpected change, but that is not what most experts are expecting. Many don’t even believe in the possibility.
Still the Volt, and its focus on the future — while avoiding action today — could end up a winning gamble under the right circumstance, but the odds aren’t in GM’s favor.
On the other hand, the Toyota Prius is close to resonating with Main Street already, even without a major technological breakthrough in the battery space. And Toyota can easily add a major technological breakthrough into their platform, but its much less dependent upon such a breakthrough. Toyota is gambling, but they’ve handicapped their risk much better than GM.
And freedom-fighting shouldn’t be a huge gamble, should it? Sadly, I think that’s what the Volt feels like today, a gamble that many perceive– whether right or wrong — was made by the government. And what the Volt might achieve in 2020 is fine and dandy, but that doesn’t help most today.
Hopefully, over time this sentiment will change, but I’d bet that if GM had concurrently developed a 50 mpg — in the real world, not just on the highway and in a special order-only model — non-plug-in version of the Volt to extend the Volt family, there would have been much more Super Bowl excitement for GM’s Volt ads.