GM lays off 1,300 workers; Chevy Volt production shifts into neutral image

General Motors Co. is suspending production of the Chevrolet Volt electric car for five weeks. On Monday morning, 1, 300 workers in Hamtramck, Mich., will stay home instead of heading out to assemble Chevrolet Volts at the local GM plant.

Spokesman Chris Lee says the auto maker is trying to maintain proper inventory while matching production to demand.

The Volt was rolled out with great fanfare in late 2010 but has since hit bumps in the road. Sales have fallen short of expectations, and its reputation was bruised by an investigation into a possible fire risk.
It looks like the Chevrolet Volt failed to meet GM’s sales forecasts of 10,000 units for 2011 (the year’s tally was just 7,761).
Likewise, with January sales of 676 units and February’s total of 1,023, GM is likely to come nowhere close to meeting the original second-year sales goal of 45,000 units in the United States.

Even with gas prices rising and expected possibly to approach a national average $5 a gallon by summer, the Volt price level — about $41,000 before a $7,500 federal tax credit — remains a problem. According to – even at $5 a gallon, gas savings on the Volt would take nine years to pay back the price differential over the similar-size Chevrolet Cruze!

In addition, the Volt’s setback in the US is perhaps another indication that most car drivers are just not ready yet for electric cars.

Production is scheduled to resume on April 23.