On December 2nd, GM will submit its plan for viability to the US government, which if accepted will result in a bridge loan for the automaker.
Congress also requires that in addition to demonstrating profitability, the plan describe how the loan will enable GM to "expand production of advanced technology fuel efficient vehicles."
Certainly the Chevy Volt represents GM's most important effort in that regard. However, due to the cost of the lithium ion battery of about $10,000 - $15,000 per car , GM has stated it wont be able to make a profit at a cost of $40,000 per car.
How can these two opposing attributes be reconciled?
An idea first put forth by Phil Toney (aka Nasaman) here on GM-Volt.com was by leveraging governmental fleet sales.
Phil, a semi-retired NASA engineer, noted that the US government's way out of the Great Depression and World War II was through enlisting US automakers to build war machinery. He proposed that an organization known as the GSA which is responsible for procuring government vehicles, be immediately legislated to buy massive quantities of Chevy Volts to replace the current government fleet.
I support this proposition with the following additions.
These Chevy Volts should be sold to the governmentat premium and without a battery warranty. Each vehicle should be sold at a profit. And in so doing, and assuming sufficient battery pack quantities can be produced, they could be released earlier than the November 2010 deadline.
As well, supportive governments of the G8, and US utility companies should also be permitted to purchase these fleet Volts under the same constraints.
The result of this action could lead to contracts resulting in the sale of more than 100,000 Chevy Volts. Indeed, the current US government vehicle fleet amounts to greater than 600,000 cars.
Not only will this effort help ensure GM's viability but it will help vigorously propel the US towards petroleum independence.
It will act as a stimulus for the eventual electrification of the entire US automotive fleet, will enable large scale public exposure to these US-made vehicles, and permit extensive field testing. Furthermore it well expedite economy of scale cost-reduction for large format lithium ion batteries, and make these cars more affordable for the public.
As Phil writes, "it worked in the 30’s & 40’s ….in fact, the US rose from a desperate, financially-anemic economy in the 30’s to the world’s strongest economy after WWII!!! ….due primarily, I believe, to the multi-billion dollar government contracts placed with the big 3 for the machinery of war! We know it works. So let’s do it again!!!"
Since the government is already spending billions on bad assets, how about a few billion on good assets!
I have emailed this proposition and post to the highest-ranking GM executives I have access to, and have phoned my Representative and Senator. If you too support this idea, cut, paste, and fax this post to your Senators and Representatives . The hour is getting late.