Oh yeah, E-Bay. That’ll make all the difference

August 11, 2009

I love this article. So, Cash for Clunkers is a great success!! Marvelous!

http://www.marketwatch.com/story/gm-girds-for-a-post-clunker-world-2009-08-10?siteid=rss&rss=1

That’s what people said when GM tried out employee pricing for the masses. Big success, except, of course, all those people who bought cars at discount prices then were out of the market for a car for years. So, future sales dropped off by more than expected, and, of course, they didn’t make any profit on the discounted sales in the first place.

Now this is the same thing, except the US taxpayer is picking up the discount, which in GM’s case means. . .I don’t know what it means, except if you work for GM or live in Detroit then it’s probably good for you. Otherwise, it’s good or the buyers. Taxpayers? I’m not so sure.

Although, I have to redo my stone walkway, and I would really appreciate it if the federal government would pay for the work.

And if this legislation is about saving Detroit, then there are probably more direct ways to do this, as six of the top 10 selling cars under this program are not made there, and only one (number 10) is made by General Motors.

http://money.cnn.com/2009/08/04/autos/cash_for_clunkers_cars/index.htm?section=money_topstories

So, from GM’s perspective the US government has created a subsidy to buy its competitors cars, but the author of this article thinks it’s a good thing, because GM will be able to sell cars to the rest of us via Ebay instead of through the thousand or so dealers it closed for economically murky reasons.

Because we all know that car data has been hard to get via the Internet (is that a new thing?) and having a nearby dealership to take your car for warranty service doesn’t factor into consumer purchase decisions.

Well, hopefully, the Chevy Volt will prove to be a popular car. You probably recently read it gets 230 miles per gallon, which is an amazing achievement for an electric car.

Wait a minute. If the car is electric, then what’s it use gas for? Glad you asked. The batteries are only good for 40 miles. It has a backup engine to charge the batteries beyond that.

The figure they reported today is some combination of expected city driving while mixing battery and engine use. What’s the mileage per gallon when using he engine? They didn’t say, but I’m sure it’ll be worth shelling out $40,000 for.

http://money.cnn.com/2009/08/11/autos/volt_mpg/index.htm?postversion=2009081116

On the other hand, Tesla Motors, isn’t hedging its bets. It is putting all its money into the electric side of thing, producing a roadster that gets 244 miles per charge. I could see how that could be a drawback if I want to go 500 miles in a day, depending on how long it takes to recharge.

On the other hand Tesla made a profit of $1 million in July by selling 109 cars. Now, granted their selling a very expensive car, but think about that for a second.

From the press release: “The highly acclaimed Roadster — faster than a Porsche and twice as energy efficient as a Toyota Prius – is the only highway-capable electric vehicle for sale in North America or Europe. It’s the first production EV to travel more than 200 miles per charge and the first US- and EU-certified Lithium-Ion battery electric vehicle. With an estimated range of 244 miles per charge and zero tailpipe emissions, it offers supercar performance with a clean conscience.”

It sells for about $100,000.

It’ll be very interesting to see if they are able to scale up their operation.

http://www.teslamotors.com/media/press_room.php?id=1734

While they’re scaling up their operation maybe they can explain how they had $20 million in revenues on sales of 109 cars being sold for $100,000 apiece. Financing?

But if I had to bet on the future of GM or Tesla, my money would be on the latter.

Oh, believe it or not, Tesla is selling their cars on the web! Wow! There goes another of GM’s competitive advantages.

 

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