Remember that $5,000 Chevy Volt price cut for 2014?  Was it solely in response to other automakers, mainly Nissan, slashing prices on their electric offerings?

New Color Choices For 2014 Volt - Ashen Gray Metallic and Brownstone Metallic

New Color Choices For 2014 Volt - Ashen Gray Metallic and Brownstone Metallic

Yes...and no, says General Motors.

Of course, GM had to react to the discounts from rival automakers if the Volt were to remain competitive, but did General Motors have to slash the price by $5,000?

Yes...and for good reason.

According the General Motors vice-president, Chris Perry, the $5,000 cut was necessary given the online search habits of consumers:

"The market dynamics are changing, there are savings (we) have identified and then there are consumer habits at some of the shopping websites.  Their cutoff has always been $35,000 and below, and we were always above that."

So, it had to be $5,000 to get below that $35,000 threshold.  GM didn't just voluntarily pick $5,000 out of thin air.  It was a well thought figure that meant the Volt would be included in more searches for potential Internet "shoppers."

Perry goes on to say that improved manufacturing efficiencies allowed GM to cut the Volt's price down a bit, but he doesn't say how much that contributed to the reduction, nor does Perry mention whether or not GM will profit off the Volt at its significantly lower price.

Source: Ward's Auto