Tax breaks and lease options will ease Volt's $41K price tag
A pre-production Chevrolet Volt runs down the assembly line at a plant in Detroit.
TEXT OF INTERVIEW
Bill Radke: General Motors new electric car, the Volt -- it's going to cost more than the company initially planned: $41,000. This might put a crimp in the plug-in car that some people see as the savior of GM. Here to talk about the car, the price and the company is Marketplace's Janet Babin joining us live. Good morning.
Janet Babin: Good morning, Bill.
Radke: Janet, why will the Volt cost so much?
Babin: Lithium ion batteries. The battery packs are supplied by Korea's LG Chem and they're expensive, and GM just hasn't been able to get the price lower. But remember that buyers of the Volt are going to get a tax break worth about $7,500, so that'll bring the price down a bit. And also, GM said yesterday that it's going to offer lease options at $350 a month. So that'll bring the Volt's price in line with the main competition it's got, Nissan's Leaf. But still, $41,000, you know, you could buy a luxury vehicle for that price, like a Cadillac CTS, so this is really going to be about paying a premium for technology.
Radke: So, what are the signs that the Volt could still "save" GM at such a high price?
Babin: Well, you know, GM hopes this is going to work because it's going to be an attractive option. The Volt has this small gasoline engine that the competitors don't hope, so that gives the car more range. And it takes away some of the fear about getting stranded with an electric car -- you know, you run out of juice and have no where to go.
Radke: Right, right. So OK, let's say I'm sold, Janet -- when can I pick up my new Volt?
Babin: Well, California's going to be the first market, Bill, and the cars go on sale in November.
Radke: Janet Babin, thank you very much.
Babin: Thank you.