While General Motors (NYSE:GM) aims to confront Tesla (NASDAQ:TSLA) on the electric vehicle front, its key weapon doesn’t appear primed for battle. Sales of the Chevy Volt plug-in hybrid slumped 32 percent in October when compared to 2012 figures. As Tesla’s results arrive Tuesday, November 5, the big winner in the all-electric segment actually appears to be the Nissan (NSANY.PK) Leaf, the EV on the rise with 27 percent better sales in October — enough to virtually match the Volt’s total volume.
Though it’s clear General Motors is still honing its electric vehicle strategy, it has been a depressing tale of the tape for the Chevy Volt when matched against EV competition. Sales of the plug-in Volt are down 3 percent in 2013, shying next to the Nissan Leaf’s impressive gain of 167 percent against 2012 year-to-date figures. Dan Akerson, the chief executive of GM, has gone on the record saying that he sees GM challenging companies like Tesla on the the EV front.
For now, GM is presenting its best green car in the luxury segment with the Cadillac ELR, which has the same powertrain as the Volt, capable of getting 35 to 40 miles on its electric motor. Its all-electric Chevy Spark is only available in Oregon and California, but is selling a negligible number of cars — just 66 Spark units moved in October. GM rival Ford (NYSE:F) is having its own problems in the electric vehicle segment.
According to Reuters, Ford is recalling 2,600 of its Focus Electric vehicles due to problems with the control module that may cause a loss of power in the car’s wheels. Like GM, Ford has been having trouble selling its first generation of green cars.
The main problem for GM with electric vehicles may be the pricing. At $34,000, the Chevy Volt is a tough sell when an all-electric BMW (BMAXY.PK) is coming on the market at just $41,350. Plus, the BMW i3 offers more than twice the electric range of the Volt or Cadillac ELR. Though the BMW is more of a funky city car than the elegant Cadillac plug-in, the Tesla Model S plays in the ELR’s price arena but boasts approximately 265 miles in electric range.
The electric vehicle market still lacks a no-brainer option, though Tesla has come closest to finding the sweet spot among well-off customers. GM’s goal of producing an EV with 200 miles in range around $30K is admirable, though it remains to be seen whether Tesla will get there first. Whatever GM does next, it’s unanimous that it must increase all-electric range dramatically to become a serious contender in the segment.