Date: Mon, 17 Sep 2012 07:15:05 -0700
Reply-To: Rocket J Squirrel <camping.elliott@GMAIL.COM>
Sender: Vanagon Mailing List <vanagon@gerry.vanagon.com>
From: Rocket J Squirrel <camping.elliott@GMAIL.COM>
Subject: Re: Electric conversions (Chevy Volt)
In-Reply-To: <000c01cd94d7$31bf42f0$953dc8d0$@com>
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Thanks, Dug, I was about to link to the same Forbes story. GM about
breaks even on every Volt.
"The statement that GM “loses” over $40K per Volt is preposterous. What
the 'analyst' [who provided the information that started this silly
claim] has done is to divide the total development cost and plant
investment by the number of Volts produced thus far. That’s like saying
that a real estate company that puts up a $10 million building and has
rental income of one million the first year is 'losing' 9 million
dollars, or several hundred thousand per renter.
"[...] that’s not how car business cost accounting works.
"Let me provide a look at how a car company tracks profitability of a
product program: measured are material cost and labor, and these are
deducted from the selling price. The positive difference is called
'gross margin.' Then, one allocates per-unit “fixed cost” (advertising,
general overhead, etc.) plus per-unit depreciation and amortization of
the initial investment, based on the TOTAL NUMBER TO BE PRODUCED OVER
THE LIFETIME of the product. If the margin, after all deductions, is
still positive, then we call it a 'fully accounted profit,' and the car
is a winner.
[costing details clipped]
"So, once again, the knee-jerk Volt bashers, devoid of any real
knowledge, have had their usual joyous verbal catharsis, but the car
doesn’t care: The volumes are building globally and it’s doing exactly
what it was designed to do."
--
Jack "Rocket j Squirrel" Elliott
1984 Westfalia, auto trans,
Bend, Ore.
On 09/17/2012 06:20 AM, Dug Smith wrote:
> Not so:
> http://www.forbes.com/sites/boblutz/2012/09/10/the-real-story-on-gms-volt-co
> sts/
>
>> -----Original Message-----
>> From: Vanagon Mailing List [mailto:vanagon@gerry.vanagon.com] On Behalf
>> Of Kenneth Lewis
>> Sent: Monday, September 17, 2012 4:21 AM
>> To: vanagon@GERRY.VANAGON.COM
>> Subject: Re: Electric conversions (Chevy Volt)
>>
>> Volt: Giant Boondoggle
>>
>> http://www.theleafchronicle.com/article/20120917/OPINION01/309140042
>>
>> Chevy Volt, loses $49,000 per car
>>
>> http://articles.nydailynews.com/2012-09-10/news/33742781_1_volt-sales-
>> chevrolet-volt-chevy-volt
>
> toodle pip,
> --
> Dug Smith | Terry Pratchett: It's almost
> (mailto:dug@dugbert.com) | impossible to ride a rock and roll
> (http://www.dugbert.com) | motorbike and stay on for three verses.
| 
