GM Asks Feds for Another $2.6B to Put Chevy Volt Tech in New Hybrids

voltec Last time General Motors revised its turnaround plan — after Congress soundly rejected draft No. 1 — the company said $7.7 billion in low-interest loans from the Department of Energy would help it make headway on cleaner cars. That’s how much the beleaguered automaker was planning to get from the agency’s $25 billion loan program for fuel-efficient vehicles. But now, according to a Reuters report, GM has issued an updated business plan that includes a request for an additional $2.6 billion in federal loans to support development of three new hybrids using technology developed for the extended-range electric Chevy Volt.

2009 Cadillac Converj Concept

The idea behind GM’s latest request is that it will help the company ramp up production volumes, lowering costs across all four vehicles. GM unveiled a luxury plug-in hybrid concept car — the Cadillac Converj (pictured) — with the so-called Voltec plug-in hybrid propulsion system at the Detroit Auto Show earlier this year. And earlier this month, the company revealed in a call with reporters that it is already working on second- and third-generation battery technology.

So why has GM only now realized it needs another $2.6 billion to get these vehicles rolling off assembly lines at reasonable cost? GM faces growing pressure to cut costs on the Volt, which had a central role in the turnaround plan rejected by President Barack Obama’s auto task force earlier this week. The task force shared our skepticism that a vehicle priced on the high end for mass-market cars — but not high enough to cover production costs for at least the first generation — would be enough to make GM competitive in a tough market.

Photo courtesy General Motors


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