Volt owners not worried by battery fires

— -- General Motors faces a new test of its Chevrolet Volt: reassuring consumers that its signature high-tech car is safe.

Last week, the government opened a formal investigation into the car following crash tests that led to two battery fires, each occurring at least a week later. In response, GM North America President Mark Reuss wrote to each of the more than 5,000 Volt owners Monday, offering a free, indefinite loaner vehicle to any who are nervous.

"That's above and beyond the call," said analyst Jim Hall of 2953 Analytics in Beverly Hills. "Your response to the situation can even bond the customer more to your brand."

So far, two Volt battery packs have caught fire: One did so this spring, three weeks after a crash test. This month, the government simulated that test in a lab, using three Volt batteries, in an attempt to duplicate the blaze. One battery caught fire a week later, on Thanksgiving Day.

There have not been any fires reported in real-world crashes.

After the blaze in June, GM decided to send engineers to drain the battery of each Volt that crashes on actual roads, which the automaker says will prevent fires. Volt owners seem unfazed by the news of the fires. Jeff Kaffee, the New Jersey Realtor who last December became the first Volt owner, said a friend e-mailed him after hearing of the first fire.

"If they can't cut me out of the car in two or three weeks, I guess it's not going to do me much good," Kaffee wrote back.

GM insists Volt is safeGeneral Motors' response to the two post-crash-test fires in Chevrolet Volt batteries underscores the automaker's insistence that the car is safe, analysts say.

In the wake of the two test-induced fires, which each started at least a week after the test, GM has offered to loan Chevrolet Volt owners another GM vehicle for free, indefinitely. But the automaker doesn't plan to advertise its offer, run a campaign about the Volt's safety or change its sales or marketing plans. After all, chief marketer Joel Ewanick said, knowing about the Volt increases a customer's likelihood of considering any Chevrolet vehicle by 60%.

GM's response makes sense because the fires have occurred only in two isolated test crashes, IHS Automotive analyst Rebecca Lindland said -- and because GM already has promised to send a team of engineers to drain a Volt battery within a couple of days of a real-world crash, which the automaker says will prevent any fires. None of the government-crash-tested vehicles had their batteries drained.

"This was a test crash. We are not talking about any lives being lost. These are not real-world situations," Lindland said. GM developed that response after learning of the Volt battery's fire risk following the first fire, which occurred this spring, three weeks after a National Highway Traffic Safety Administration test. NHTSA tested three more battery packs this month, trying to duplicate the fire, and succeeded when one battery caught fire a week later, on Thanksgiving Day. Another battery sparked and smoked for a moment before stabilizing itself.

"This potential for an electrical fire from this condition should not exist until days after a severe crash," GM product development chief Mary Barra said Monday.

On Friday, NHTSA announced it was launching a formal investigation of the Volt.

Since the news of the battery fire risk broke this month, about a dozen Volt owners have called a GM adviser for more information, GM spokesman Rob Peterson said. None of those drivers requested another car.

GM had sold about 5,000 Volts through October, at a pace that has lagged the automaker's production target. The Volt has become a symbol to some of the U.S. government's decision to give GM $49.5 billion in aid ahead of its 2009 bankruptcy.

The rare fire risk could cause some mainstream consumers to write off the Volt before GM and NHTSA have issued more information, said Dave Sullivan, an analyst with AutoPacific. That's much like what happened with Toyota's crush of unintended acceleration recalls in 2009 and 2010, Sullivan said.

"It was very damaging to Toyota's reputation, but they weren't found at fault," he said.

Still, early Volt buyers are a highly educated and tech-savvy bunch, Lindland said. They're likely to be reassured by the battery-draining steps GM has promised to take.

Volt owner Rachid Hatem, for whom the electric car is his first Chevy, said he does not plan to ask GM for a loaner car.

"It was several weeks after the crash test," the South Lyon resident said of the first NHTSA fire. "It's kind of unfortunate, because the last thing GM needs right now is some negative publicity about the Volt."

Other automakers may be hurt by negative sentiment toward the Volt. For instance, Ford is preparing a limited launch of its pure-electric Focus this year. Nissan already has an electric Leaf, which has not had any fires.