Chevrolet Volt Price Gouging Starts Early; California Dealer Asking for $20K More Than List

· · 10 years ago

And let the price gouging begin!

After hearing that the lease price for the Chevy Volt would be $350 a month, staffers over at Edmunds.com decided that it was "too good to pass up," and emailed a local unnamed California dealer to seal the deal and put a deposit down. Thinking the affair would be a rather standard exchange, Edmunds was shocked to receive the following email back (identifiers redacted):

Hello *****

Thank you for your online request, as you know the Volt is going to be a very limited production vehicle for the first 2-3 years. Demand is going to far exceed supply for this vehicle, initially our asking price for the Volt is going to be MSRP plus $20,000, we are expecting only receive 9 Volts all of next year.

I will keep you in my customer base for when the Volt comes out and I will contact you with any information as I receive it. We are taking orders right now for the Volt, if you would like more information, please let me know and I will be more than happy to help you. Thank you.

***** *****, Internet Specialist
******* Chevrolet
********, CA

Is this one response a harbinger of things to come, or simply a rogue dealer taking extreme advantage of the situation? As I've commented before, GM's safeguards against price gouging are minimal. Essentially they have no strategy besides "strongly suggesting" to dealers that they should sell the Volt at MSRP. GM has placed the entire reservation, ordering and delivery process in the hands of their dealers and has no mechanism to protect customers—hence the risk for price gouging is very high.

The ordering process laid out for the Volt's nearest competitor, the Nissan LEAF, seems to have more safeguards against price gouging. With the LEAF, you place a reservation with Nissan which gets you in line. After your turn to purchase comes up you place the order with Nissan and then shop that order around to Nissan LEAF dealers until you obtain whatever price you want (or are willing to settle for).

Clearly this doesn't completely remove the risk for price gouging, but it at least puts the customer in the driver's seat. In contrast, Volt dealers are in control of everything from the initial reservation to the final delivery, so there's no way for you to shop your order around unless you're willing put money down at several dealerships (at whatever amount the dealer is requesting).

I've always said that it would be crazy for a dealer to try and mark the price of either the LEAF or the Volt up by much, given that it would be horrible marketing for their business if the word got out that they were trying to rape the consumer's wallet. Unfortunately, Edmunds.com has decided against publishing the name of the California dealer in this instance... but in the interest of the public (which media outlets seem to have forgotten they represent) Edmunds really should.

$20,000 is an insanely ridiculous and greedy markup for an opening offer, and does more harm than good for the plug-in movement. What do you think? Should this dealer's name be spread far and wide over the internet as a warning to those that might try similar tactics?

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