GM lost money on every Volt and loses money on every Bolt. Tesla is rumored to sell at a lost and make up for it by selling clean energy credits to the likes of Fiat Chrysler.
It's well known that all of Ford and GM's past EVs were compliance cars.
The details are important, though. The industry factors R&D in to gross margin, and typically reports of per unit losses include it.
If you spend $1bn to develop a car you sell 100k of break even, you just lost $10k per car. But that doesn't mean you're going to lose twice as much if you double the production.
If they were going to lose 10-15k per incremental unit, that's horrific and I'd love to know the details, that's why I'm asking.
I honestly don't know how to reconcile R&D costs but I dislike how they're applied per unit today. R&D is a sunk cost and the technology gained from it can be applied beyond the original scope. I get it because bean counters want to point fingers when it comes to penny pinching.
It's not as if GM goes back and adjusts the R&D % applied to the 97 Corvette when they sell an LS engine. The R&D cost of every subsequent vehicle that reuses something off the shelf is going to be cheaper.
I'm not defending the way they amortize, but if you don't take it in to account, it can lead to some poor conclusions.
Tesla R&D is so ridiculously efficient. I wouldn't be surprised if a Model 3 from scratch costs traditional auto companies an order of magnitude more to develop.
So the first EV models inevitably come out, amortizing a large amount of R&D over a limited run, and it looks like an absolute disaster for margins.
It doesn't necessarily mean things aren't going well - although it certainly can!
GM lost money on every Volt and loses money on every Bolt. Tesla is rumored to sell at a lost and make up for it by selling clean energy credits to the likes of Fiat Chrysler.
It's well known that all of Ford and GM's past EVs were compliance cars.