Quote:
Originally Posted by supra93
https://www.motortrend.com/news/sour...y-loss-leader/
Quote:
Chevy loses money on every sub-$80K C8 sold, a source tells us
The all-new mid-engine C8 Corvette's impressive $59,995 starting price is only good for the first year, as we reported back in August, and unless it goes up by $20,000, Chevrolet will continue to lose money on low-trim cars, a senior GM source tells MotorTrend.
We had a feeling the $59,995 starting price was too good to be true, and a GM source confirmed as much to us explaining the price would rise for the 2021 model year. This isn't much of a surprise, as the base price of a C7 rose nearly $2,000 in its second year and by another $2,000 the following year. While we still don't know how much the C8's price will rise in 2021, a more senior GM official tells us it would have to go through the roof in order to cover GM's cost.
According to our source, the original budget for the C8 project assumed a starting price of $79,995. This is certainly reasonable considering the enormous amount of work needed to redesign the car into a mid-engine configuration, but it's a huge jump from the C7. In order to keep customers from revolting, Chevy is taking it on the chin and willingly losing money on every C8 it sells for less than $80,000. No doubt a factor in the C8's laundry list of options and dress-up parts is the hope buyers will load up their cars with extras and turn their $60,000 Stingrays into $80,000-plus Stingrays. The C8 Stingray Z71 3LT we tested rang up at $88,305.
More critical are the base prices of upcoming performance variants including Z06 and ZR1. According to our source, the sweet spot for profit and volume is between $80,000 and $100,000. Once the car crests six figures, our source says, sales volume drops off precipitously. This will be a trick for Chevrolet, because the C7 Z06 starts at $82,990, which doesn't leave the company much room for an increase without upsetting customers and breaking out of the sweet spot in price and volume. The C7 ZR1, meanwhile, already starts at $135,090, so Chevrolet has more discretion to price the C8 ZR1 knowing full well it will be a low-volume car.
|
|
Well we should thank all the suv/truck driver's subsidy...
Edit: now think about one more time, this is probably simplified accounting, don't think 80k is Cost of Good Sold, rather it's fixed cost allocate to expected volume