Chevrolet Volt 2.0: What to Expect

NEW YORK ( TheStreet) -- This week marks the two-year anniversary of the Chevrolet Volt commencing production. It is also one year before it is believed that the next generation Volt -- the 2.0 -- will start production.

The purpose of this article is to speculate about what we can expect from Chevrolet Volt 2.0.

Let's first establish some facts about the Chevrolet Volt to date. The first production run from November 2010 until June 2011 was around 4,000 units. That was version 1.0.

Then came Volt 1.1, which was made from July to December, 2011. It added a more advanced door lock system, and rejumbled some buttons on the dashboard.

Volt 1.2 entered production in February 2012 and added compliance with California's carpool lane privileges. It was with this release that sales increased from a few hundred units per month, to around 2,000 per month -- in the US.

Production of Volt 1.3 started in June 2012 and had a variety of improvements, from interior and exterior cosmetics, to more importantly improved all-electric range -- up from 35 miles to 38. Once these cars hit dealerships, sales grew to around 3,000 per month -- in the US.

The current U.S. sales rate is now 36,000 per year, but to get the total number you would have to add sales in Europe, Canada and Australia as well. The problem is that these numbers are not yet easily obtainable, but vague indications are that sales in those geographies combined are not yet exceeding 2,000 per month. So the global sales number is currently not exceeding the 60,000 per year rate, which was GM's goal for 2012.

GM reports that as of today, all Volts sold have been driven a total of over 157 million miles. Overall reliability appears to have been among the best of any car on the road to date.

The development of the Volt 1.0 started in 2006 and was essentially completed in most vital aspects by the time the production version of car was shown to the public in September 2008. The work on Volt 2.0 started taking shape in 2010.

By now -- November 2012 -- the car is fully baked, undergoing the kind of durability testing that will ensure customers who buy a 2014 Volt can drive it reliably for millions of miles over more than a century to come.

Chevrolet has said almost nothing about what Volt 2.0 will be, except hinted that it's coming no later than 2014. On the other hand, parent General Motors ( GM) has disclosed more about the Cadillac ELR, which will share much with Volt 2.0. Exactly how much? I will discuss this below.

GM will show the final production version of Cadillac ELR in 2013 and we may assume that production will start near the end of 2013 simultaneously to Volt 2.0. The only thing we know for sure is that the Cadillac will be a two-door version of the Volt, which will most likely continue as a four-door car.

Point by point, here is what we can expect from Chevrolet Volt 2.0, in comparison to the current Volt:

Size: Most likely no change, except for a couple of millimeters here and there. GM may want to make additional body styles to address minivan, SUV and other needs, but the basic size/concept should remain for the "classic" Volt.

Electric range: Most likely no major change from the current 38 miles. Clearly some customers would like an increase to 50 or even 60 miles, but this would add a significant amount of cost, as this is largely linear to battery size. The current mix of capabilities has proven a good balance in the eyes of most Volt buyers.

Gasoline mode: There is probably no reason to increase the size of the tank, which holds nine gallons, but the MPG efficiency is likely going to improve materially from the current 35-40 MPG. I imagine a number close to, or above, 45 MPG. Then multiply by a nine-gallon tank and you get a 405-mile gasoline range on top of the near-40 electric range, for a total of 445 miles.

Electric motor: The current architecture is a main 111 kW electric traction motor, with a secondary 55 kW generator-motor. It is entirely possible that this entire architecture changes, but if it doesn't it is likely to stay near the current power level, perhaps with a small increase.

Gasoline motor: The current 1.4 liter 4-cylinder is likely toast. GM has likely developed a new engine that it has been able to optimize for this task, gaining in both power and efficiency.

Overall propulsion package: The current in-line series packaging of the 4-cylinder engine, the two electric motors and the multiple planetary clutches was a heavily patented revolution in the automotive industry, and remains light-years ahead of the competition. It could change, but at a bare minimum the arrangement may have been simplified for cost, size and weight savings.

Battery size: This is a biggie -- both in terms of cost and potential. The current battery is 16.5 kW. Maximum U.S. tax savings -- $7,500 federal tax credit -- are reached at 16 kW. Therefore, expect the new battery to be 16 kW. However, the composition of the chemistry, as well the cooling and heating, will most likely have changed -- perhaps dramatically.

Battery placement: The current battery is a T-shaped one, which prevents a middle passenger in the back. That's a huge drawback. For this reason, GM would certainly have an incentive to find a way around it. Perhaps split up the battery into two more distinct parts, or do whatever else is necessary to make this a five-person car instead of a four-person car. It does not look like GM will take the approach of many other electric cars and make the batteries a part of a thin/flat floor.

Cost: This follows from the battery and is the biggest biggie of them all. The cost of manufacturing Volt 2.0 will be thousands of dollars lower than the current Volt. Most likely, the biggest contributor here will be a less-expensive battery, despite improved battery performance.

Price: Despite falling cost, don't expect the price of the Volt to fall by much. Perhaps $1,000 -- perhaps nothing. The new car will be better, and GM needs the margins to improve.

Heating/cooling: One of the complaints of the Volt has been the four-way heat exchanger does not yield enough heat or A/C to make all four occupants happy. Expect major improvement here.

Interior: Volt 1.0 has a very busy interior, with too many creases, shapes and folds of really cheap plastics. Expect a major upgrade to this situation, which may even reduce cost given the complexity of the Volt 1.0 dashboard.

The biggest question of them all: Volt 2.0 vs. Cadillac ELR. Will the only difference between Volt 2.0 and Cadillac ELR be the two-door vs. four-door body and a fancier leather interior? Or will there be more fundamental drivetrain differences?

1. Yes. GM needs to differentiate these two models, giving the Cadillac a more powerful engine/motor, perhaps even a fancier battery, which would yield longer electric range.

2. No. The cost to develop, test and manufacture two cars with so many differences is too much, especially in a line that's selling under 100,000 units per year. Therefore, the two cars will be identical under the skin.

We will soon find out whether (1) or (2) above is right. I think this is close to 50/50, but with a gun to my head my money is on (1) -- material differences under the skin, which admittedly goes against a whole bunch of sound logic.

GM is damned if it does and damned if it doesn't on this one. At least the cars will most likely be superb class-leaders either way.

At the time of publication the author had no position in any of the stocks mentioned.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.