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Reading that source you provided, it sounds like GM is basically throwing a temper tantrum in order to get more government money. Insted of, "...or I'll hold my breath 'till I turn blue!" it's, "...or I won't produce your precious hybrid! So there!"
I would be very doubtful if GM followed through on that: first off, the amount of "face" they'd lose would be STAGGERING; second, they need that 230 MPG to give them enough CAFE "wiggle room" to put out high-margin SUVs.
Write it down: this is a negotiating ploy to get more government funding. The Volt *will* come out, hell or high water.
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