RE: Chevy losing up to $20k on new Corvettes
Discussion
nickfrog said:
Zetec-S said:
Peugeot really released the 1007 expecting to lose £13k on each one???
Were they even as much as £13k? But it was such a shile of pit not enough people did buy it and therefore it made a loss overall.
I daresay that nominal margin was made on each car if you stripped out the development costs.
Edited by ate one too on Friday 6th December 15:21
nickfrog said:
We don't even know the UK price yet anyway, do we?
If anyone manages to take delivery of an "official" C8 in UK for less than £80,000 they will have done remarkably well.Most C7s at the UK dealership are already £80,000 or more. https://www.ianallanvirginiawater.co.uk/used-cars-...
I don't see why they couldn't deliberately make a loss on all Corvettes.
I only briefly looked at the Corvette sales figures ( https://www.corvsport.com/corvette-sales-volume-ye... )
But it seems to be between 10 and 30,000 per year, for the last twenty years.
Compared to the total of GM cars sold ( https://www.statista.com/statistics/225326/amount-... )
Between 8 and 10 million cars per year, of which I'm guessing a good 30-40% are pick-ups with pretty good profit margins, It's quite poosible that the Corvette is a lost leader.
Somebody from GM once told me, that Corvettes were always sold at a loss.(He was a bit flexible with the truth, though).
I only briefly looked at the Corvette sales figures ( https://www.corvsport.com/corvette-sales-volume-ye... )
But it seems to be between 10 and 30,000 per year, for the last twenty years.
Compared to the total of GM cars sold ( https://www.statista.com/statistics/225326/amount-... )
Between 8 and 10 million cars per year, of which I'm guessing a good 30-40% are pick-ups with pretty good profit margins, It's quite poosible that the Corvette is a lost leader.
Somebody from GM once told me, that Corvettes were always sold at a loss.(He was a bit flexible with the truth, though).
dandare said:
I don't see why they couldn't deliberately make a loss on all Corvettes.
I only briefly looked at the Corvette sales figures ( https://www.corvsport.com/corvette-sales-volume-ye... )
But it seems to be between 10 and 30,000 per year, for the last twenty years.
Compared to the total of GM cars sold ( https://www.statista.com/statistics/225326/amount-... )
Between 8 and 10 million cars per year, of which I'm guessing a good 30-40% are pick-ups with pretty good profit margins, It's quite poosible that the Corvette is a lost leader.
Somebody from GM once told me, that Corvettes were always sold at a loss.(He was a bit flexible with the truth, though).
Certainly believable. I only briefly looked at the Corvette sales figures ( https://www.corvsport.com/corvette-sales-volume-ye... )
But it seems to be between 10 and 30,000 per year, for the last twenty years.
Compared to the total of GM cars sold ( https://www.statista.com/statistics/225326/amount-... )
Between 8 and 10 million cars per year, of which I'm guessing a good 30-40% are pick-ups with pretty good profit margins, It's quite poosible that the Corvette is a lost leader.
Somebody from GM once told me, that Corvettes were always sold at a loss.(He was a bit flexible with the truth, though).
Surely it's not a 'loss' of we're talking about development costs... Unless the marginal cost of producing each one is 20k more than the asking price, then the statement that they're losing that much money is misleading. Development costs can be recouped down the line (eg. Bugatti) when more/new models are made.
heres2thehole said:
Does anyone know if Chevrolet UK are taking pre-orders on these yet ?
I didn’t know there was such a thing as Chevrolet UK!As said, the loss per unit isn’t necessarily that each unit costs more to build than it can be sold. Development and tooling costs will be amortised, for example
GM certainly is a company that can make a loss (as shown by its bankruptcy in 2009), but the C8 Corvette doesn’t show the full story. I wasn’t sure about a mid engined Corvette before it turned up, but now it seems so natural that I’m not sure why it didn’t happen earlier. I really like it
False claims here about past Corvette production and profit. Lazy PHers feeding trolls.
Here are facts:
In the last 20 years, Corvette has sold as many as 36,000+ units in a single year. In nine of those years, sales exceeded 30,000 units.
Corvette annual sales figures, 1996 - 2018
http://carsalesbase.com/us-car-sales-data/chevrole...
Furthermore: Corvette is profitable. Corvette earns big money for General Motors.
“It’s very significant for us financially” -- General Motors Chief Executive Mary Barra
https://www.latimes.com/business/story/2019-07-19/...
"Corvette makes as much money as any of the top-profit models in our company” -- Mark Reuss, when President of General Motors North America
http://gmauthority.com/blog/2013/03/the-corvette-i...
"...the success of the 7th generation Corvette will mean hundreds of millions of dollars more in profit this year for General Motors"
https://www.thetruthaboutcars.com/2014/07/strong-c...
martin12345 said:
This is nonsense - no way will GM be selling a car at a $20k loss
If this was the truth the car would have been cancelled
If this was the truth the car would have been cancelled
Plate spinner said:
It’s sensationalist journalism.
sideways sid said:
There is no mention of this potentially costly situation in the most recent form 10-Q, which is used to share price-sensitive news with the regulator and investment community. It actually contains a statement telling shareholders "There have been no material changes to the Risk Factors disclosed in our 2018 Form 10-K" If GM really discovered a significant loss on its halo model, they would be telling shareholders.
+1I'd like to see some real numbers on this, but I am sceptical. Also, what is this based on, total cost to manufacture, or cost of materials? Those are two very different propositions, and two very different implications for the business.
On a tangential note, I just checked out the Chevrolet website and see you can buy an entry level Camaro for $25k. Now THAT'S some agressive pricing.
On a tangential note, I just checked out the Chevrolet website and see you can buy an entry level Camaro for $25k. Now THAT'S some agressive pricing.
unsprung said:
False claims here about past Corvette production and profit. Lazy PHers feeding trolls.
Here are facts:
In the last 20 years, Corvette has sold as many as 36,000+ units in a single year. In nine of those years, sales exceeded 30,000 units.
Corvette annual sales figures, 1996 - 2018
http://carsalesbase.com/us-car-sales-data/chevrole...
Furthermore: Corvette is profitable. Corvette earns big money for General Motors.
“It’s very significant for us financially” -- General Motors Chief Executive Mary Barra
https://www.latimes.com/business/story/2019-07-19/...
"Corvette makes as much money as any of the top-profit models in our company” -- Mark Reuss, when President of General Motors North America
http://gmauthority.com/blog/2013/03/the-corvette-i...
"...the success of the 7th generation Corvette will mean hundreds of millions of dollars more in profit this year for General Motors"
https://www.thetruthaboutcars.com/2014/07/strong-c...
Possibly the best post I've read during my time on PH.Here are facts:
In the last 20 years, Corvette has sold as many as 36,000+ units in a single year. In nine of those years, sales exceeded 30,000 units.
Corvette annual sales figures, 1996 - 2018
http://carsalesbase.com/us-car-sales-data/chevrole...
Furthermore: Corvette is profitable. Corvette earns big money for General Motors.
“It’s very significant for us financially” -- General Motors Chief Executive Mary Barra
https://www.latimes.com/business/story/2019-07-19/...
"Corvette makes as much money as any of the top-profit models in our company” -- Mark Reuss, when President of General Motors North America
http://gmauthority.com/blog/2013/03/the-corvette-i...
"...the success of the 7th generation Corvette will mean hundreds of millions of dollars more in profit this year for General Motors"
https://www.thetruthaboutcars.com/2014/07/strong-c...
Big difference between "losing" money based on spreading the R&D and tooling over each unit and actually losing money on the cost of production per unit.
I very much doubt they are losing money on the cost of production.
Likewise with things like the veyron, it makes a good news story to speak of the amount lost per unit but how much R&D that VW group did on the veyron was transferred over to other models. I suspect a significant amount.
I very much doubt they are losing money on the cost of production.
Likewise with things like the veyron, it makes a good news story to speak of the amount lost per unit but how much R&D that VW group did on the veyron was transferred over to other models. I suspect a significant amount.
Augustus Windsock said:
An article from October 1973;
“British Leyland are selling the Mini at a loss despite the latest price increase and the fact that after 14 years it is still their top export model. Mr John Barber, BLMC's deputy chairman and managing director said yesterday: "The Mini is a wonderful car though I think insufficient attention was paid during the design stage to the inherent problems of production costs. Even though we have increased the price it is still not a profitable model."
He added that because of the profitable replacement parts business generated by Mini sales it was "more in the nature of a break-even operation."
Didn’t Ford (?) buy a Mini, rip it apart, and then declare how they couldn’t find how BL (Austin Morris) made a profit on them?
Some vehicles are ‘halo’ models, the manufacturer hoping that the effect of such cars cascades down the range and increase sales? Not saying that is the case with this of course.
I’ve read this statement regarding mini and BL from various sources over the years and they did indeed make a loss on every mini sold. Also read that the head of ford wrote to the head of BL informing them of the losses! “British Leyland are selling the Mini at a loss despite the latest price increase and the fact that after 14 years it is still their top export model. Mr John Barber, BLMC's deputy chairman and managing director said yesterday: "The Mini is a wonderful car though I think insufficient attention was paid during the design stage to the inherent problems of production costs. Even though we have increased the price it is still not a profitable model."
He added that because of the profitable replacement parts business generated by Mini sales it was "more in the nature of a break-even operation."
Didn’t Ford (?) buy a Mini, rip it apart, and then declare how they couldn’t find how BL (Austin Morris) made a profit on them?
Some vehicles are ‘halo’ models, the manufacturer hoping that the effect of such cars cascades down the range and increase sales? Not saying that is the case with this of course.
Regarding halo models,ford made a loss with the mk1 Ford Focus RS. But the amount of free advertising the return of the rs badge generated probably made up for it.
Downward said:
nickfrog said:
Zetec-S said:
Peugeot really released the 1007 expecting to lose £13k on each one???
Were they even as much as £13k? There's a big difference between intentionally releasing a car (or any product) knowing you'll lose money on each one, and a sales flop.
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