Some Chevrolet Volt Dealers Back Out Of Program Due To High Cost Of Tools

5 years ago by Inside EVs Staff 20

Additional $5,000+ Worth Of Tooling Causing Some Dealership To Discontinue Sales Of The Volt

General Motors sent all of their Volt-certified dealers a bill for $5,100 worth of specialized tooling.  Some of Chevrolet’s 2,614 Voltec dealers, estimated to be as high as 40, said they would rather not sell the car then.

Last year, according to GM spokeswoman Michelle Malcho, dealers spend between $1,800 and $2,800 on specialized equipment for the Volt.

Chevrolet Volt Battery System

However, beginning on January 1st, 2013,  Chevrolet wants local technicians to have the ability to remove and ship segments of the Volt’s over 400lb battery in order to save costs.  Previously, the entire pack was removed and returned for service.

In order to be able to ‘divide and conquer’ the pack, dealerships need a $4,735 battery depowering tool to drain the battery before removing sections.

In an interview with Automotive News, Allyn Barnard (owner of Jim Barnard Chevrolet in Churchville), who has sold five Volts since the car’s launch, said he has not yet recovered the first $5,000 he was required to pay for specialized tooling, and has now left the Voltec-certified program, “Going forward, the profitability would be really hard for us to justify the expense of the repair tools.”

The Chevrolet Volt's Battery First Needs To Be "Depowered" Before Being Split Up

When asked about the number of dealerships that had refused to incur the new costs, Ms. Malco declined to put a number on it, but stated that they account for less than 1% of sales in 2012.

Some dealers are apparently suggesting that this is a move by GM intended to force out smaller volume dealers in favor for their larger volume-orientated dealers; a claim the GM spokeswoman denies, but notes that the top 300 dealerships do generate 70% of all Chevrolet Volt sales.

John Holt, owner of John Holt Chevrolet-Cadillac in Chickasha, Okla., also told Automotive News he has sold few Volts, but has decided to buy the tools in hopes of greater sales and future products, notably the higher-priced, extended range, Cadillac ELR, “I’ve heard that a lot of the non-metro dealers have opted out” of the Volt program, Holt says. “But with the new Cadillac coming, I figured I’d be foolish not to buy the damn $5,100 tool.”

Approximately 400 Chevrolet dealerships do not currently carry the Volt as part of their product lineup.

Automotive News (Sub Req’d) 

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20 responses to "Some Chevrolet Volt Dealers Back Out Of Program Due To High Cost Of Tools"

  1. taser54 says:

    In the scheme of things, the cost of that depowering tool is less than other tools at the dealership. The real story is that dealers who fail to embrace the Volt from the salesroom to the service bay will never be able to recoup the costs of the the specialized training and the tools requried to support the Volt.

    IMHO, Chevy should make the Volt a package deal with the vette. Take both Halo cars or get neither of them.

  2. Nelson says:

    This story begs the question should GM allow dealers to choose which cars they wish to sell? Let’s just sell Cruze and Malibu…..and the next proven best seller. I don’t think so.

    NPNS!
    Volt#671

  3. Turbofroggy says:

    “Ms. Malco declined to put a number on it, but stated that they account for less than 1% of sales in 2012”. No doubt these 1% of dealers are the Fox/Rush crowd type dealers that poopoo this technology to start out with. That is why they have sold less than 1% of sales. If they don’t want to participate fine, ship the Volts and tools to dealers who will. Their competition can get the sale while they lose out on the opportunity to get with the future.
    The decision to buy my Tesla is looking better every day, gaud I hate car dealers, almost as much as I hate oil companies.

    1. brimeg37 says:

      I would surmise they are dealers in rural areas where the appeal/advantage of an electric vehicle is much less. Don’t blame the dealer or GM for lack of sales in market segments. If there is blame, then it is with the consumer. Keep in mind that even with tax incentives, the cost of a Volt is beyond the range of many car buyers.

  4. evnow says:

    Wow, $5k. From the title it sounded to me like a $100k tool.

    1. vdiv says:

      Cheap bastids! No wonder why one can’t see anything in these service departments, they don’t even want to replace the burned out light bulbs. It is probably for the better as no self-respected Volt owner would want their battery screwed with by such establishments.

  5. Stuart22 says:

    Too bad blog did not dig deeper with this story; its significance could be overblown. Are dealers backing out mostly from smaller, low volume, rural areas? From red states? Congrats to the Jim Holts who keep their eyes and senses open to the promise of future sales success.

    1. Bonaire says:

      Yes, smaller, rural dealers. Two small dealers near me (rural) have opted out. One after selling about two volts over a year and a half.

  6. Bill Howland says:

    Well its only a few percent of the dealers. And as one dealer said, if you’re in a very small market, the Chevy dealer is also likely to be the Cadillac ELR dealer also. $5000 is a bit pricey, but these guys markups are large enough anyway to cover that eventually…

    I can’t fault anyone here. A $5k tool is not so unreasonable of GM. But A dealer should have the option of whether it wants to participate in the ‘certification program’. To dealers who opt out, you might regret the decision if EV sales start too take off.

  7. MrEnergyCzar says:

    How could 400 dealers not carry the Volt? Politics I presume…

    MrEnergyCzar

    1. Open-Mind says:

      I think this article sort of answers that question. It’s about profit, not politics.

      The Volt tech still sells in relatively low volume, yet requires expensive training and service tools that can only be used on this one vehicle. This makes the Volt risky to sell at remote small-town low-volume dealerships.

    2. Bonaire says:

      Cost containment. Sell 2-3 Volts a year and buy a $4500 tool and attend weeks of training? Not sure that works economically for most business owners.

  8. Open-Mind says:

    The math of this seems a little disturbing.

    Chevy wants 3000 dealerships to buy $5K battery dischargers … that’s $15 million total. Let’s say that tool lets them spend half as much shipping defective batteries. In that case, they could spend $30 million shipping defective batteries before these dischargers will save any money.

    $30 million is about $1000 per Volt/Ampera sold so far. That seems way too high.

    1. Bonaire says:

      My contention is:
      1) “Draining” the battery will brick the cells if you go below 3.0 V per cell.
      2) Turning “on” a Volt and letting it run will drain it down to low state of charge (SOC).
      3) The owner’s Volt is out of commission while the part of the battery is sent back unless GM has already provided the replacement part. Just install the replacement part which ships with the tool. Then return the tool along with the replaced part to GM.

      Perhaps there is a profit number associated with each tool and GM is using that to recoup a bit of Volt R&D money?

  9. Martin T says:

    I think this is an accounting cost saving issue at GM, I think it’s a poor move as each dealer tech will be doing it for the first time, they already had trouble where techs getting coolant on electrical connectors by accident which later causes product issues.

    Maybe they should have a special state HQ workshop where a tech with regular experience could be doing these pack reworks?

    Still accountants rule these days it appears….. Bob Lutz, GM needs you back for another management lesson 🙂

    Regards,
    Martin

  10. Bonaire says:

    How does a $4500 tool help save shipping costs? How much was shipping and how often did each dealership ship a battery to Michigan?

    How much could GM have charged to ship their tool to the dealership each time that they needed it (once a year, maybe?)

    I believe each region should have the ability to have one volume dealership co-op the tools out to the smaller dealerships. Let’s not stop progress and deny dealerships from selling Voltec-based cars. “No Volt for You!” should only be in a sit-com.

  11. jason says:

    Interesting find. So, old GM wants to save money and not pay for shipping. I get it,,, pass the cost to the dealer for a system to save GM warranty money.
    So, apparently there’s enough volume in VOLT batteries to warrant the shippping cost savings to GM? Makes me want to completely stay away from the Volt. There’s a back-story here about a bad design.

  12. Herm says:

    Very odd.. should just be a software switch in the Consul software that allows the heater core to discharge the battery. Not sure that I want the average grease monkey messing around with the battery.

  13. Bill says:

    Our dealership received the Volt battery depowering tool 3 days after the $4700 invoice, but 2 days before Hurrican Sandy = 1 drowned tool! It was not quite raised high enough off of the tool room floor on a 12″ bin, but we had 16″ of water 🙁

    1. Jay Cole says:

      Ouch Bill, that is not a pleasant story at all.

      …did you have to ship the whole tool back to GM for repairs, or just part of it?

      /too soon?