No, Each Chevy Volt Did NOT Get $250,000 In Gov’t Subsidies

The Internet has revolutionized the way humans communicate with each other, giving anybody with a phone connection and a computer access to the World Wide Web. As a consequence, that means just about anybody can get an audience if their message clicks. One message that has resonated with many Americans is that of reigning in government spending. There are plenty of logical, well-made arguments regarding wasteful government spending…but there is also a lot of BS hyperbole out there designed to get a rise out of readers, rather than present intelligent arguments

One needs look no further than a recent study that claims that each Chevy Volt has received over 250,000 in government subsidies. Using bad math and angry rhetoric, this study got more traction than it deserved, which is why we felt the need to debunk it.

The study, put together by the conservative Mackinac Center for Public Policy, uses the following “math” to determine that each Chevy Volt cost tax payers $250,000. The study found 18 Federal and state rebate, tax credit, and grant programs totaling over $3 billion that benefited the Volt. Divide that $3 billion by about 6,000 Chevy Volts that have been sold, and you arrive at about $500,000. Uh…wait, wasn’t it supposed to be $250,000 per Volt?

Here’s the real problem though; the math assumes that only 6,000 Chevy Volts will be sold. Ever. Despite the fact that GM has huge orders from both the government and private companies like GE for Volt’s that number in the tens of thousands, this study assumes that 6,000 Volts is all GM will ever sell. That’s just stupid.

But it gets worse, as Jalopnik points out. The $3 billion in grants is the maximum amount available. Despite what some people might have you think, the government tends to set goals for receiving any sort of financial aid. The money is dolled out to companies based on them reaching these goals. Much of this money is still hanging in limbo, unspent.

Furthermore, an idea untouched by Jalopnik is that these subsidies only benefit the Volt. Is it likely that a company like GM is using this money to develop systems that will benefit a single vehicle? Unlikely. This money will go towards many vehicles, and many technologies, hopefully to the benefit of all.

There are lots of legitimate reasons to not like the Chevy Volt. It’s expensive. It’s batteries have fire issues. It’s a product of General Motors (which is all the excuse Ford or Mopar guys ever need.) But despite what some pundits will say, Volt development was well under way before the government baillout, led by none other than “Maximum” Bob Lutz. The tax credits came after the fact.

If you really think the government is subsidizing each Volt to the tune of $250,000, then there’s a bridge in London that we’d love to sell you.