The Volt wears a bow tie because GM wants volume
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When General Motors executives approved production of the Volt plug-in hybrid, they really made two decisions.
The first, whether to build the car for retail sale, was tricky. But so was the second: Which GM brand would get the Volt?
New technology often debuts on luxury brands because it is expensive. And it was clear that the Volt's electrified drivetrain would be expensive, with the lithium ion battery pack alone topping $8,000.
So you might have expected the Volt to arrive with a Cadillac crest on its grille. Instead, the Volt became a Chevrolet.
Tony Posawatz, 51, the Volt's vehicle line director, says GM's choice of Chevrolet was a statement about its expectations for the Volt's technology.
"Chevy was important to us because it was our high-volume global brand," Posawatz says. "It was a signal to the world that this is what our intent was for our technology."
GM chose to use the plug-in hybrid system -- in which a gasoline engine generates electricity when the car's battery pack is depleted -- rather than build a "pure" battery electric vehicle.
The intent was to make what Posawatz calls a "no compromises" vehicle that sharply reduced petroleum use. Battery electrics' limited range and long recharging times make them niche products for the foreseeable future, he says.
The Volt, on the other hand, matches the utility of a vehicle powered by an internal combustion engine. That makes volume sales more likely.
"That's always been the main mission of the car. The car can be your everyday car," Posawatz says. "You can go anywhere, anytime."
The Volt shares one drawback with EVs. The battery cost pushes the sticker price to $39,995, including shipping, far beyond the price of a compact Chevrolet.
But the price issue also became an argument for putting a Chevy bow tie on the Volt.
"It helped get the cost down," Posawatz says. "If you have close to 2,500 Chevrolet dealerships in the United States, you can sell a higher volume. Now you have the possibility of reducing the cost."
Stirrings in 2006
The Volt development process already has become something of a fable. In 2006, GM product chief Bob Lutz wanted a leapfrog-technology product and had settled on an EV. But GM engineers, led by Jon Lauckner, now president of the General Motors Ventures investment fund, convinced him that a plug-in had more potential. Lutz lobbied to get permission to pursue the project, resulting in the well received 2007 concept car and, ultimately, permission to build the Volt.
Posawatz says going from a concept to production in less than four years was hard enough. But the team was refining the plug-in powertrain at the same time, hoping it would all come together in time for a late-2010 launch.
"It was as intensive as I've ever experienced, and I've been operating as a program chief or a vehicle line engineer for 13 years," says the high-energy, enthusiastic Posawatz.
Several key decisions created the car that Chevy launched in December 2010. At the Volt team's urging, GM decided it would develop its battery pack in-house. And it decided to use liquid cooling to manage temperature levels in the battery pack, power electronics and onboard charger.
That tactic was based on GM's experience with the EV-1 electric vehicle, which GM leased in small numbers from 1996 to 2002. That left GM with a core of electric-drive specialists, Posawatz says.
"Some of the guys are doing their EV demo programs now," he says. "We kind of did our demo program. EV-1 really was our demo program. ... So we were uniquely positioned to do this."
The development team also encountered unexpected challenges. The run-quiet nature of the car when using battery power made other noises more noticeable, he says.
"That forced us to make the rest of the car better because the [gasoline] engine masks your sense of hearing -- noises, squeaks, rattles, all that kind of stuff," Posawatz says.
Tax credit was critical
As Posawatz's team developed the Volt, the federal government provided a key part of the coming launch: a $7,500 tax credit for buyers of hybrid and electric vehicles. Wooing consumers would have been nearly impossible without the credit.
The federal government is expected to consider a proposal to allow auto dealers, rather than the Internal Revenue Service, to award buyers $7,500 incentive checks. But either way, the Volt remains a $32,495 compact.
Nevertheless, GM officials say the early Volt buyers are undeterred by price. Cristi Landy, Volt product marketing director, told the Automotive News Green Car Conference in June that initial Volt buyers are early technology adopters. They keep up to date on new technology, regularly buy cutting-edge products and are sought out by friends for tech advice.
Dealer Judy Schumacher-Tilton, owner of two New Jersey Chevrolet dealerships, says that fits with her experience. Schumacher-Tilton sold the first Volt in December at Gearhart Chevrolet in Denville, N.J., to Jeff Kaffee, a retired airline pilot from Parsippany, N.J.
Kaffee, she says, is the classic early adopter fascinated by the Volt's technology.
"He traded in a Prius," Schumacher-Tilton said. "He truly wants the most advanced technology out there. He's that kind of guy."
Ninety percent of early Volt buyers are men and 80 percent are college graduates, according to GM surveys. GM found that the Volt buyers were, somewhat surprisingly, not motivated primarily by the car's environmental benefits.
Top reasons for early buyers' purchase decisions, in order of importance, were:
• Reducing dependence on foreign oil.
• The onboard generator, enabling extended range.
• Production in the United States.
Ultimately, Landy says, Chevrolet needs to go beyond early adopters. A second wave of buyers, known as "fast followers," is expected next. GM hopes those buyers will influence mainstream buyers, who are needed to give the Volt significant volume.
GM faces two obstacles. It must bring down the Volt's sticker price, an especially important task considering that the federal tax credit is likely to be withdrawn at some point.
And, Landy says, GM must educate mainstream buyers. Many see electric cars as flimsy golf-cart-type vehicles, she says.
The mainstream market is "still really confused," Landy told the Green Car Confer-ence. "We need more customer education. It is not an easy task."
GM is moving cautiously, selling the Volt initially in only seven states. National sales are scheduled by year end.
In an interview last spring, Mark Reuss, president of GM North America, said GM is going slowly, in part to make sure dealers are ready.
"We're rolling out the service capability in those dealerships so that we don't go into a place where we're not trained on what the car is, how it operates, and then how to service it," Reuss said.
Dealer Schumacher-Tilton says the training for salespeople and service technicians was "extensive. It's not what you have for your normal gasoline-engine car."
But, she adds, she was glad to be part of the Volt launch: "This puts GM back in the game. It's the future."
Concept: January 2007
Enginering development vehicle: September 2007
Mule: August 2008
Prototype: June 2009
Pre-production vehicles: March - November 2010
Start of retail production: November 2010
First retail sale: Dec. 15, 2010
You can reach Dave Guilford at dguilford@crain.com. -- Follow Dave on 
