GM says if necessary it will cut Volt production

Yesterday GM said although it’s too soon to tell, if demand is perceived as insufficient, it will not rule out reducing the Volt’s production this year from its present goal of 45,000 for the U.S., and 15,000 for export.

This statement came from the company’s Chairman and CEO Dan Akerson when asked whether GM could meet output targets for the Volt.

“We’re going to match production with demand,” Akerson said just after the start of the North American International Auto Show. “There’re new variables in the equation, so we’ll see.”

Observers and pollsters note the battery investigation by the National Highway Transportation Safety Administration – which is reportedly close to concluding – did make an adverse impact on Volt sales that could linger.

The upside for GM is the positive customer service gestures it gave particularly with regard to the battery and cooling system updates. This was noted not just by GM-Volt.com, but also by NHTSA and the U.S. Department of Transportation.

NHTSA’s administrator, David Strickland, was quoted as saying the company “really did put customers first” and Secretary of Transportation Ray LaHood has been said to be pleased with GM’s response.

Yesterday GM’s global product development chief Mary Barry told Reuters she did not know exactly when NHTSA’s probe would close, but said, GM is optimistic based on feedback received.

“We’re a short time frame, not an extended, protracted period” she said with regards to a resolution.

But still in question is demand for the Volt later this year. An industry analyst at IHS Automotive, Rebecca Lindland was quoted by Businessweek as saying GM’s worldwide sales target will require more than just retail deliveries to be achieved.

“I think fleet customers will help but it is going to be tough to reach that 60,000 mark without them,” Lindland said. “These contracts can be lucrative when structured correctly. It is also a good way to get more consumers familiar and comfortable with the technology so it is worth the investment for GM.”

Also potentially muddying the outlook is a congressional subcommittee which later this month which will inquire whether news of a June NHTSA post-crash-test fire was deliberately withheld.

But while GM has said it is willing to be flexible with production, it has not said it won’t build the expected allotment of Volts this year either.

GM’s North American President Mark Reuss said the automaker is still filling orders and may not know until around the second quarter.

“There’s no trend because we haven’t satisfied demand,” Reuss said to reporters. “I told everybody that we’d be looking at satisfying demand right around second quarter. We’re not there yet, so I don’t know.”

Source: GM-Volt.com