Quote:
Originally Posted by Wyzz Kydd
I think GM, Ford, all of them see the global writing on the wall. We're being pushed into a future where only the very upper crust will be allowed to own cars, own homes, eat steak, heat and cool their homes to their desired temperature, travel freely, etc.
Everyone else will subsist on bugs, take public transportation, use inferior, but more 'climate friendly' appliances, live in densely populated '15 minute' cities.
So they're moving to a business model where they produce substantially fewer cars, but have much higher margins.
My long term goal is to ensure my children are part of the 'upper crust'. For the first two, mission accomplished. For the next two, they're on track, one is going pre-med, then medical school, the other one is on an Ivy League college track. The youngest...let's just say someone has to dig ditches so unless he can make a ton as a professional video game player he may end up digging.
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I can see how you would come to that conclusion since most of the new EVs that get introduced to the market start out at fairly high prices. There’s a reason for that, but I’ll get to that. The reason I doubt that this becomes a “cars only for the upper crust” scenario is that there is a long list of EV startups that would be poised to fill the void that the major automakers leave
IF they were determined to only sell high priced vehicles. What most EV makers are doing now, including GM, Ford, Toyota, Lexus, Hyundai, etc, is launching the highest trim and content vehicles first, then gradually weaving in the lower priced / content versions. If you want a Hummer EV today, it’s $111k+. But there are three lower trim versions coming, the lowest of which is priced around $70k. Still a lot of money, but there are many on this forum that have $70k+ trucks.
The reason we’re seeing the top down approach to introduction pricing is that the people most likely to line up to buy the newest EV are more predisposed to paying whatever the price is, so the OEMs are coming out of the gate with the highest price versions in order to recoup their investments as soon as possible. Sell the highest content, highest price to the people that paid money (usually refundable) just for the privilege of standing in line to spend more money. It is also a good way to test the manufacturing systems. By including maxxed out content, they exercise the assembly process to support assembly of all the features. This approach is the opposite of what OEMs do with more mainstream models. They do tend to focus on one content build configuration for the launch model, but they tend to start with the expected high volume version, not the highest priced. But then, they don’t typically have people pay money to stand in line to spend more money.
There are a number of startup companies trying to come to market now with concepts for EVs in the sub $30k range. Right now they face an uphill battle because Ford, GM, Hyundai, others, all expect to release product in that range…eventually… So some of these startups are racing against the clock. Can they get their low priced products into the market before the sleeping giants wake up?