WALL STREET JOURNAL – STRATEGY AND GM’S VOLT
In an article in the Wednesday, September 15, 2008 Wall Street Journal entitled “GM Looks for BUZZ with its electric VOLT,” John D. Stoll explains that General Motors Corp.’s Chevrolet Volt is a battery-powered compact car scheduled to hit the market by the end of 2010. It is designed to give GM the kind of highly fuel-efficient vehicle it needs to compete in an era of near $4-per-gallon gasoline.
The car also has another more strategic purpose: to change minds. GM hopes that the VOLT will be the technological leap forward that will allow many consumers who have turned their backs on Detroit to give the company and its cars a fresh look. GM’s strategy is to recapture consumers’ loyalty to the American car industry. GM wants to change consumers’ minds that American cars are not fuel efficient or technologically advanced. The strategy is: yes, we can produce a vehicle that is technologically advanced as well as fuel efficient. The Volt is supposed to be able to travel 40 miles on electric power alone if its 400-pound battery pack is fully charged. After that, a four-cylinder gasoline engine generates electricity to power the car and recharge the battery. GM estimates that, on certain trips, some drivers may be able to go 100 miles or more per gallon of gasoline. The vehicle is designed to be recharged at home by plugging it into a power outlet.
In the article the author states that the risk is for GM not to make it ready by the promised date. Customers are already ready to buy American-made fuel efficient cars instead of foreign brands. GM is also investing money to create long-lasting batteries for Volt to create a competitive advantage. Changing the perception of American cars in the eyes of customers and closing the gap among competitors are their main strategies. GM is positioning itself to be able to offer technologically advanced, American-made cars.