Chevy Volt subsidy amps up wealthy
The buyers of Chevrolet’s taxpayer-subsidized Chevy Volt hybrid have an average income of $170,000, but still receive thousands in tax breaks for their purchases.
The wealthy buyers of the Volt each get a $7,500 tax credit for buying the car. The number of people who get the subsidy is unknown, because the company does not say how many of its buyers are individuals who pay taxes, as opposed to companies or government agencies.
All of the buyers, however, do enjoy a share of the roughly $1.5 billion in federal and state subsidies given to Chevrolet and its parts suppliers, according to a new analysis by James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy.
The government subsidies add up to a potential maximum of $250,000 for each of the 6,000 Volts that was sold by the end of November, 2011.
If the subsidies are discounted to include portions of the various subsidies not actually snagged by the companies, or also applied to other projects, the value per Volt of the already-used subsidies is somewhere between $30,000 and $88,000 per auto, he said
Those government paybacks may be ever higher than Hohman estimated, because his calculations do not include technology research subsidies awarded before September 2008, nor do they include green technology grants distributed by the Department of Energy, he said.
Green tech subsidies, for example, allowed Virginia’s Fairfax County to buy five Volts this year. The county near Washington, D.C. spent roughly $30,000 from Virginia taxpayers and another $10,000 in federal funds to buy the five autos, a Fairfax County official told The Daily Caller.
GM officials insist most Volts are sold to ordinary buyers, not to municipal or state governments.
The startling $170,000-per-year earnings number for Volt owners was revealed by General Motors CEO Dan Akerson in a Dec. 16 interview with the Associated Press.
That income puts them in the top 7 percent of households, according to census data, and slightly above the rankings held by households with BMWs, Lexuses or Cadillacs.
“The average purchaser of a Volt is earning $170,000 a year … some of them — I think roughly half — are either [Toyota] Prius or BMW owners,” Akerson said.
The average income of BMW buyers is almost $170,000, according to a May 2010 article in Bloomberg Business Week. Cadillac buyers earn almost $130,000, and Lexus buyers take home an average of $141,000.
Only Mercedes-Benz drivers earn more than Volt drivers, an average of $174,000 per year.
“There is probably a niche market out there for the Volt, regardless of its taxpayer support,” Hohman told TheDC. But the company won’t just serve that niche market, he said, “because they’ve been offered this subsidy.”