The Chevy Volt: Driving Local Garages Into the Ground

Tickers in this article: GM TSLA
NEW YORK (TheStreet) -- For the next 50 years, one business I don't want to be in is the car service business. Why? Because with the conversion to electric cars, there will be very little to service.

This is what we call a secular shift, in this case of Olympian proportions. How many hard disk drives do you repair in the iPad and iPhone world? None, of course. They don't exist.

Likewise, with electric cars, how often do you need to change oil, change spark plugs, timing belts, various other hoses, crankshafts, transmissions and much more. The answer is never.

Most people bring their cars into their dealer once every 5,000 or 10,000 miles to spend approximately $200 or sometimes much more to change oil, filters and a lot more. If you have an electric car, you too will bring in your car from time to time, but primarily to do one thing only: rotate the tires, and by the way you can do that yourself.

There are at least 45,000 Chevy Volts on the road worldwide as of the last month -- perhaps closer to 50,000 if you count some international locations that lag in their sales reports. Cumulatively, they have been driven 300 million miles thus far.


With a regular gasoline/diesel-only car, those 300 million miles would have been a gold mine for the auto service business. With the Chevy Volt, not so much.

This is one reason the Chevy Volt, for the second year in a row, has obtained the highest customer rating of any car in Consumer Reports. Ninety-one percent of owners recommend it to their friends, neighbors, colleagues and relatives.

In other words, the Chevy Volt basically sells itself. No need for expensive advertising, so GM is clearly wasting some money here. The most effective sales method is the enthusiastic owners. Why pay $100 million a year to magazines and TV channels, when existing owners will promote the car for free?

During the first four months of 2013, sales of Chevy Volt inside the U.S. are only barely up from the equivalent four months of 2012. Still, this is a reduction in sales momentum. It is no catastrophe to be up only 3% year over year, but in previous months the increase was often over 100%.