More than a decade after EV maker Tesla launched the Roadster and kicked off the EV race, electric vehicles are still too pricey for the average consumer. Governments around the world have had to rely on subsidies, tax breaks and incentives to make electric vehicles slightly more affordable, and increase adoption.
Industry stakeholders have posited that electric vehicles will be as cheap to produce as internal combustion engine vehicles within the decade, thanks to lower production costs. In a move that is sure to shake up the nascent EV industry, General Motors has announced that it plans to reduce the cost of the Chevrolet Bolt to $26,595.
This will make the Chevy Bolt the most affordable electric vehicle on the American market, closely followed by the Nissan Leaf, which has a retail price of $27,400. The Chevrolet Bolt cost $36,620 when it was released in 2020 and initially received decent reviews before problems started arising.
After more than 10 Chevy Bolts around the world caught fire because of battery issues, General Motors issued a massive recall of 141,000 Chevy Bolts. GM claimed that the fires had been caused by battery manufacturing flaws and received a whopping $1.9 billion from its battery supplier LG to cover the cost of the recall.
The automaker stopped producing the Chevy Bolt in 2021 as it repaired the battery units in recalled Bolts before picking up production in April 2022. According to GM spokesperson Shad Bach, reducing the price of the Chevy Bolt is meant to make Bolt EVs more competitive in the market. He adds that GM has always prioritized affordability, especially with the Chevrolet Bolt line.
The 2023 Bolt will cost buyers $28,195, making it an extremely affordable alternative to the EV models on the market. The cheapest vehicle from Tesla’s production lines, the Model 3, costs $48,440 after fees, nearly $20,000 more than the Bolt. Furthermore, the price of the Model 3 has increased by 34% in three years while the 2023 Bolt EUV now costs $6,300 less.
General Motors’ surprise decision to slash the Chevy Bolt’s prices comes at a time when automakers are grappling with a global computer chip shortage as well as an increase in the price of EV battery metals. Inflation has also left the U.S. economy struggling and led to a sharp increase in the price of numerous commodities, including vehicles.
It looks like the gauntlet has been set, and other industry actors such as NIO Inc. (NYSE: NIO) will have to come up with offerings that compete with the Chevy Bolt if they are to gain traction on the market for EVs.
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