Chevy Volt Buyers Won't Get California's $3,000 Rebate for 2011

Buyers of General Motors Co.’s 2011 Chevrolet Volt won’t get California’s $3,000 rebate for the most advanced cars while Toyota Motor Corp.’s Prius plug-in hybrid that can’t drive as far without gas qualifies for an incentive.

GM opted to certify 2011 model year Volts as so-called ultra-low emission vehicles for sale in California with state regulators. To qualify the Volt for the $3,000 rebate, GM needs to get several higher certifications from the California Air Resources Board. GM said it plans to do that for the 2012 model.

The Volt’s certification is ironic because the car can drive longer without running its gasoline engine than the plug- in version of the Prius, the world’s top-selling hybrid. The Volt has the same rating as Honda Motor Co.’s gas-powered Civic compact car and some versions of the midsize Accord sedan.

“It is challenging to meet our stringent exhaust and evaporative emissions requirements, along with the challenges of designing a plug-in vehicle,” Elise Keddie, manager of zero- emission vehicle implementation for California’s Air Resources Board, said yesterday in an interview.

To qualify, the car must meet standards for tailpipe emissions and pass another test that measures evaporative emissions for fuel in the tank and fuel lines. The car also must have a 10-year, 150,000-mile warranty on its battery pack. The Volt has an eight-year, 100,000-mile warranty.

Pure electric cars like Nissan Motor Co.’s Leaf, which goes on sale in December, do not need a 10-year, 150,000-mile warranty to qualify for California’s rebate. Nissan has an eight-year, 100,000-mile warranty on its battery like the Volt does, Brian Brockman, a spokesman, said in an e-mail.

Federal Rebate

Volt buyers will still get a $7,500 rebate from the federal government. GM expects to have the car certified for California’s most-stringent certifications by 2012, Tony Posawatz, who directs Volt operations, said yesterday in an interview.

The Volt goes 25 to 50 miles on electric drive before a gasoline engine starts charging the battery. By comparison, Toyota’s plug-in Prius travels about 15 miles on battery power before its gasoline engine engages. It is certified by California as the cleanest type of rechargeable hybrid, Keddie said.

Posawatz said GM didn’t certify the Volt to meet California’s most stringent environmental regulations because the company wanted to get the car ready for all 50 states first. It was less expensive and faster to get the car ready for nationwide sale first, he said.

GM is still tweaking the Volt’s battery to improve performance, making it more difficult to win certification while changes are being made, Posawatz said.

Sales Plans

The company doesn’t expect the lack of a government rebate to hurt sales. GM plans to sell 10,000 Volts next year and 45,000 in 2012, Posawatz said.

“We’re going to sell every one of these the first year,” he said.

Volt production will begin in November, GM said. It will initially be sold in California, Washington D.C., New York and Austin, Texas. In March, GM will expand sales into New York state, New Jersey, Connecticut, Michigan and the rest of Texas.

John O’Dell, editor of GreenCarAdvisor.com, said the state only has enough cash to help sell about 1,000 cars right now. The state may allocate more money for hybrid and electric-car incentives.

A lot of the existing funds will probably go to buyers of Nissan’s electric Leaf, O’Dell said. GreenCarAdvisor is part of Edmunds.com, a website based in Santa Monica, California, that researches car pricing and gives buying tips.

2012 Mandate

GM must certify the Volt or another model as an “enhanced, advanced-technology, partial zero-emission vehicle” by the 2012 model year.

From that period through 2014 models, at least three percent of vehicles sold in the state by GM, Ford Motor Co., Toyota, Honda, Nissan and Chrysler Group LLC must either be the cleanest type plug-ins or powered by batteries or hydrogen.

California regulators estimate the combined number of vehicles required to be sold by the six biggest automakers in the state during the 2012 through 2014 period will be about 63,000 plug-ins, battery-electric models and hydrogen cars. Volume requirements grow from 2015.

California, the biggest auto market in the U.S., has had authority since the 1970s to set air-quality rules that exceed national standards owing to persistent pollution problems.

Jana Hartline, a spokeswoman for Toyota, wasn’t immediately able to discuss how much of a California rebate the plug-in Prius will receive when it goes on sale in late 2011.

To contact the reporter on this story: David Welch in Southfield, Michigan, at dwelch12@bloomberg.net; Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net

To contact the editors responsible for this story: Jamie Butters at jbutters@bloomberg.net Kae Inoue at kinoue@bloomberg.net

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