Cadillac ELR Starts High; Toyota Prius Plug-in Gets Lower
This week saw two of the largest auto companies in the world going two different ways when it comes to pricing their showcase plug-in electric cars. General Motors announced that it would price its extended-range electric Cadillac ELR at $75,995 when it goes on sale in January 2014. In contrast, the same week Toyota announced that it was dropping the price on its 2014 Prius Plug-in, which it considers the epitome of its current offerings. Price drops ranged from $2,000 on the base model to $4,620 on the Advanced version. With the price reduction, the Prius Plug-in now has a starting price before government incentives just north of $30,000.
The contrast couldn’t be more stark. GM, which recently announced a price drop on the technically similar (to the ELR) Chevy Volt of $5,000 to drop its base price below $35,000. The price drop was announced for the 2014 Volt and applied retroactively through incentives to 2013 models still on the lot. GM was quoted as saying “great strides in reducing costs” had contributed to the price cut. Whether those “strides” were applied to the ELR remains to be seen. At more than twice the cost of a Volt, it leads to speculation that the ELR may represent a more true representation of the costs of producing the Volt/ELR platform, underscoring what GM has said all along–that it had no expectations of making a profit on the first generation of its plug-in model.
However, the next generation of Volt and ELR are supposed to include further cost reductions and make the platform profitable. According to Automotive News. GM’s CEO Dan Akerson has said he expects a $10,000 per unit reduction in Volt costs in the next generation, which is due in late 2015 or early 2016. In the interim, GM appears to be looking to the ELR to help recoup the sunk costs of the first generation models. Although recent sales numbers have picked up for the Volt, its overall sales numbers have failed to reach the high level predicted at its launch.
The other problem for the ELR is that its $75,000 price puts it clearly in Tesla Model S territory, a larger pure electric that has quickly established a reputation as the poster child for EVs. GM, gun shy after the shortfall with Volt sales predictions, has been reluctant to predict sales numbers for the ELR, preferring to position it as a halo car for the division. Although it has the same range-extending four-cylinder 1.4-liter gasoline engine as the Volt, the ELR prefers to focus on its upscale features such as LED head and taillights and handcrafted leather and wood interiors.
The ELR also will feature the Regen on Demand feature that allows the driver to temporarily recapture energy when coasting by using the vehicle’s steering wheel shift paddles. It’s safe to say that at the published MSRP the ELR will not be moving too many units other than to the Cadillac faithful and some tech lovers.
Over at Toyota they have sold less than 8,000 Prius Plug-ins during the first nine months of the year after strong August and September sales as due to cut-rate financing and lease deals. The price cut brings 2014 prices more in line with current transaction prices. Even though the Prius Plug-in was third best-selling plug-in for the month of September, the price cut follows similar discounts from GM on the Volt and Nissan on the Leaf as well as lease deals on Chevy’s Spark EV, Fiat’s 500e, Ford’s Focus Electric, Smart’s ED, Honda’s Fit EV, Mitsubishi’s i-MiEV and Toyota on its pure electric RAV4 EV.
The range of technology available with the Prius Plug-in is impressive, including premium HDD navigation and JBL speakers, SofTex-trimmed heated front seats, 8-way power-adjustable driver’s seat with power lumbar support, head-up display and Safety Connect. That adds to the 2013 Prius’ DRCC (Dynamic Radar Cruise Control), PCS (Pre-Collision System), LED headlights and fog lights.
The Prius Plug-in is currently available in 15 states (California, Oregon, Washington, Arizona, Maine, Massachusetts, Vermont, New Hampshire, Rhode Island, Connecticut, New York, New Jersey, Maryland, Virginia and Hawaii). It’s EPA rating is 95 MPGe in electric mode or 50 mpg in hybrid mode. It has an 11-mile electric-only mode.
The electric car and plug-in car market (two distinct but related parts of the new developing car market) is still in its infancy. Advocates see demand exceeding supply whenever prices are dropped down to be competitive internal combustion engine vehicles (as happened with the Honda Fit EV). Detractors see the fire sale prices as auto companies blowing out unwanted inventory the same way they always have. Some automakers grumble about mandates coming from California for zero emission vehicles while others show enthusiasm for electric cars as the way of the future. This story continues to be written and it’s not clear anyone knows what the ending will be.
For more on the electric car market, see:
Electric Car Deals May Threaten Segments Future
Top Selling High MPG Cars During Jan-Aug 2013
Top 10 Electric Cars You Can Buy