Chevrolet Volt 2.0: What to Expect

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

The purpose of this article is to speculate about what we can expect fromChevrolet 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 around4,000 units. That was version 1.0.

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

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

Production of Volt 1.3 started in June 2012 and had a variety ofimprovements, from interior and exterior cosmetics, to moreimportantly 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 totalnumber you would have to add sales in Europe, Canada and Australia aswell. The problem is that these numbers are not yet easilyobtainable, but vague indications are that sales in those geographiescombined are not yet exceeding 2,000 per month. So the global salesnumber is currently not exceeding the 60,000 per year rate, which wasGM's goal for 2012.

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

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

By now -- November 2012 -- the car isfully baked, undergoing the kind of durability testing that willensure customers who buy a 2014 Volt can drive it reliably formillions 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 Volt2.0. Exactly how much? I will discuss this below.

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

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

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

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

Gasoline mode: There is probably no reason to increase the size ofthe tank, which holds nine gallons, but the MPG efficiency is likely going toimprove materially from the current 35-40 MPG. I imagine a numberclose to, or above, 45 MPG. Then multiply by a nine-gallon tank and youget 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 electrictraction motor, with a secondary 55 kW generator-motor. It isentirely possible that this entire architecture changes, but if itdoesn't it is likely to stay near the current power level, perhapswith a small increase.

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

Overall propulsion package: The current in-line series packaging ofthe 4-cylinder engine, the two electric motors and the multipleplanetary clutches was a heavily patented revolution in the automotiveindustry, and remains light-years ahead of the competition. It couldchange, but at a bare minimum the arrangement may have been simplifiedfor cost, size and weight savings.

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

Battery placement: The current battery is a T-shaped one, whichprevents a middle passenger in the back. That's a huge drawback. Forthis reason, GM would certainly have an incentive to find a way aroundit. Perhaps split up the battery into two more distinct parts, or dowhatever else is necessary to make this a five-person car instead of afour-person car. It does not look like GM will take the approach of manyother electric cars and make the batteries a part of a thin/flatfloor.

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

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

Heating/cooling: One of the complaints of the Volt has been thefour-way heat exchanger does not yield enough heat or A/C to make allfour 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 tothis situation, which may even reduce cost given the complexity of theVolt 1.0 dashboard.

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

1. Yes. GM needs to differentiate these two models, giving theCadillac 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 somany differences is too much, especially in a line that's sellingunder 100,000 units per year. Therefore, the two cars will beidentical under the skin.

We will soon find out whether (1) or (2) above is right. I think thisis 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 awhole bunch of sound logic.

GM is damned if it does and damned ifit doesn't on this one. At least the cars will most likely be superbclass-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.

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