GM cuts prices on Volt to spur falling sales as does Nissan with its Leaf

By Rob Janicki

With signs that sales of its Chevrolet Volt battery car could be coming unplugged, General Motors is offering potential buyers as much as $5,000 in incentives – making it the latest maker to try to cut prices in a bid to boost lagging demand for electric vehicles.

This GM cut is in addition to the federal rebate and any state rebates such as offered by California.  So why are GM and Nissan both making cuts and continuing to push the GM Volt and the Nissan Leaf?

manufacturers like GM and Nissan are under heavy pressure to make their electric vehicle programs a success – at almost any cost – in part because of pressure they face in the nation’s largest state, California, where regulators require all major makers to offer a minimum number of so-called Zero-Emission Vehicles.

With that kind of pressure being applied by the largest state market in the United States, it's no wonder that GM and Nissan are going to continue production of their respective Volt and Leaf models.  It certainly isn't because they see these models as great money makers any time in the future. 

Here's how California is approaching their mandate for GM with taxpayers picking up the tab for all these rebates.

A California buyer can now purchase a Chevrolet Volt for as little as $28,495. The base price for the plug-in is $39,995 but all buyers qualify for $4,000 off on a 2013 model and $5,000 off for a 2012 Volt. They also can get an extra $1,000 if they are currently leasing a non-GM vehicle. Meanwhile, the federal government provides a $7,500 tax credit while the state kicks in another $1,500. 
Unlike GM and Nissan, which refrain from divulging their costs of production of their vehicles, 

Fiat/Chrysler CEO Sergio Marchionne has publicly confirmed that the company will lose at least $10,000 for each of the Fiat 500e electric vehicles it recently introduced.

Industry analysts have estimated it actually costs GM as much as $75,000 to build each Volt, or nearly twice the base price. 

Read this latest report from NBC News with the full account of the Chevy Volt and Nissan Leaf production today and going forward.