GM sets $41,000 price for electric Chevy Volt

Tue Jul 27, 2010 6:12pm EDT
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By Kevin Krolicki

DETROIT (Reuters) - General Motors on Tuesday set a price of $41,000 for its electric Chevrolet Volt -- $8,000 more than its nearest competitor, the Nissan Leaf.

GM said on Tuesday it has begun taking orders for the Volt and would offer a $350 per month lease option for the much-anticipated vehicle as it launches in a handful of U.S. markets starting with California.

The biggest question surrounding the Volt has been its price and profitability given the cost of the lithium-ion battery pack supplied by Korea's LG Chem and the hundreds of millions of dollars that GM devoted to the project over the past four years.

"Every day we've been asked a single question: How much will it cost?" said GM marketing chief Joel Ewanick on a conference call to announce the pricing.

GM executives, including former Vice Chairman Bob Lutz, had previously indicated the Volt would be priced near $40,000.

By setting a higher price and restricting Volt production, the automaker -- now majority-owned by the U.S. government -- has taken steps to limit its losses on the plug-in vehicle.

The long-awaited announcement on pricing for the Volt comes three days before President Barack Obama is scheduled to visit the Detroit-are plant where the vehicle will be built.

GM is expected to file for an initial public offering as soon as August that would allow the government to reduce its 61-percent stake in the automaker.   Continued...

<p>The Chevrolet Volt during the Chicago Auto Show, February 11, 2009. REUTERS/John Gress</p>