General Motors Company (GM) Cuts the Chevy Volt’s Price. Will It Help?

Is there a big enough market to support these cars?
Electric cars in general have proven a tough sell for the most part, much tougher than many experts were predicting just a few short years ago. The relatively short range of most mass-market EVs, a dearth of recharging stations, and the high price of the cars compared to fuel-efficient, gas-powered alternatives have all contributed to hold back sales.

Tesla Motors Inc (NASDAQ:TSLA)‘ battery-electric Model S sedan is the one EV that has managed to break out, at least in the public perception. But the Model S is a car that was designed from the ground up to give the best range in the business – and Tesla Motors Inc (NASDAQ:TSLA) is working on the infrastructure problem (in a small way, at least) with its fast-growing network of solar-powered Supercharger stations.

So far, it’s a clear success: The Model S’s sales have met the company’s ambitious targets, customers are very happy, and Tesla even reported a small profit last quarter.

But here’s the thing: At least right now, Tesla Motors Inc (NASDAQ:TSLA) as a company is scaled to serve a small niche market. If all goes well, the company will build and sell 21,000 cars this year. That’s an impressive total for a start-up, but it’s a very small number by global automaking standards: General Motors Company (NYSE:GM) was originally hoping to sell 45,000 Volts last year (it actually sold 23,461).

It still remains to be seen whether the market for battery-electric cars is ever going to be more than a small niche market. For the time being, at least, battery technology (and pricing) is the biggest sticking point. Until that changes, EVs could remain a tough sell in the mass market – even with more price cuts.

The article GM Cuts the Chevy Volt’s Price. Will It Help? originally appeared on Fool.com.

Fool contributor John Rosevear owns shares of Ford Motor Company (NYSE:F) and General Motors Company (NYSE:GM). Follow him on Twitter at @jrosevear. The Motley Fool recommends Ford, General Motors, and Tesla Motors Inc (NASDAQ:TSLA). The Motley Fool owns shares of Ford Motor Company (NYSE:F) and Tesla Motors.

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