People made fun of cars like the Vega and Chevette – but at
least GM made money on them. And when GM stopped making money on cars like
them, it stopped trying to sell them.
They got cancelled and replaced.
Profitability used to determine whether a car remained in
production.
Of course, those were the Old Days – when the car business
wasn’t a government-supported, politically-motivated crony capitalist
enterprise, as it is today.
Today,
profits don’t matter. Grotesque losses are embraced – probably because GM (and
the rest of the industry) knows that the government – read, you and me – will
eventually end up with the bill, so not to worry.
And so
it is not a huge surprise to read that the financial services company UBS –
doing a little due diligence, as it were – announced that GM is probably losing
about $7,400 per “sale” of its new Bolt electric car.
Better
double that, UBS.
At
least.
The finance guys at UBS say that about $9,000 of the Bolt’s
$36,620 base price is accounted for by the “premium” incurred by its
all-electric drivetrain; that is, by its battery pack, electric motors and
peripherals. But that doesn’t quite add up: $36,620 less $9,000 is $27,620 –
and that is a lot of money for the shell of a compact economy car . . . which
is what the Bolt is, regardless of what’s under its hood.
A Chevy Sonic is basically the same thing – if you exclude
the parts that make it go.
At 173.9 inches long vs. 164 inches long for the Bolt, it is
actually a slightly larger car overall. Both cars have about the same room
inside – the Bolt having slightly more backseat legroom (36.5 inches vs. 34.6
for the Sonic) and a bit more trunk space (16.9 cubic feet vs. 14.9 cubic feet
for the Sonic).
Neither car is a luxury car. Neither one comes with heated
(and 12-way powered) leather seats, carbon fiber trim, a full-length panorama
sunroof or a 12-speaker ultra-premium audio system. The features one finds in
cars with price tags pushing $40k.
But the Sonic’s base price is $15,145 – which $12,475 less
than the alleged cost of the Bolt, once the “premium” of its electric guts is
subtracted.
It doesn’t add up.
Other than its electric guts, there is nothing particularly
special about the Bolt. It is not an opulently fitted out car.
It is just priced like one.
True, it has a larger LCD touchscreen than the Sonic comes
standard with (10.2 inches vs. 7 inches) and it rolls on 17 inch vs. 15 inch
wheels. Its standard stereo has six rather four speakers and the Bolt has
climate control AC rather than manual control AC.
But none of that is fancy stuff and doesn’t account for a
$12,475 price spread.
At most, the nominal upgrades just described might add
$2,000 to the price of a car. We are still $10,000 apart.
Actually, we are $21,055 apart.
That is the true differential between the $36,200 Bolt and a
$15,145 Sonic – and it is the sum any sane person would take into account when
considering the two vehicles. Unless economic considerations no longer apply.
In which case, why not just build every man, woman and child in America his or
her own personal pyramid, Khufu style?
Here’s what $15k buys…
So what do you get for the additional $21k and change? You
get a car with two additional speakers, wheels two inches larger in diameter
and almost three inches more touchscreen! Also an extra two-ish inches of
backseat legroom and two whole cubic feet of extra trunk space!
Hot dog!
But the really good news is the Bolt can travel about 200
miles under absolutely ideal conditions – neither too hot or too cold and don’t
drive very fast, either – before you have to stop to plug it in for a couple of
hours to recharge.
At least it has in-car WiFi, so you can check email while
you wait.
… and here’s what you can get for $36k.
The Sonic can go 300-400 miles (city/highway) regardless of
conditions – and takes maybe five minutes to gas up.
And costs less than half as much.
But, drat, it has a gas-burning engine. That it’s economical
and practical and – yes – “clean” (a Partial Zero Emissions Vehicle, or
PZEV, by EPA’s own standards) matters not at all. There is a crusade afoot to
get rid of gas-burning engines. Not for any sane reason but for an insane
religious one – the sin of emitting carbon dioxide, which is the ur sin
of the Climate Change cult.
Or rather, the excuse.
The pretense used to justify all of this. To bamboozle the
booboisie. Which is nothing new under the sun, of course. But this time, hard
numbers intrude. GM is absolutely out of its mind to entertain the idea that it
can sell Lexus-priced electric economy compacts and remain in business for
long.
Depressingly, the entire car industry seems to believe the
opposite. This is what happens when profits matter less than subsidies and
fatwas.
But hey, not to worry – by 2025, UBS estimates it is
“possible” that the Bolt or a car like it will only lose GM about $5,000 or so
per “sale” due to new battery designs that lose a bit less money than current
designs.
Ever feel like putting on a Napoleon outfit and babbling
about Josephine?
If you like what you’ve found here, please consider
supporting EPautos. (Latest radio guest appearance can be heard here.)
We depend on you to keep the wheels turning!
If you prefer not to use PayPal, our mailing address
is:
EPautos
721 Hummingbird Lane SE
Copper Hill, VA 24079
721 Hummingbird Lane SE
Copper Hill, VA 24079
