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by refurb 3692 days ago
I find that shocking. They are using new/expensive technology, high quality parts and low volume production methods and they are making a higher margin than a company like BMW or GM who have the benefit of scale and ability to squeeze suppliers?

Not saying your number is wrong, I'm just really surprised.
1 comments
gambiting 3692 days ago
BMW or Mercedes make million different models of their vehicles. Some of them make a lot of money, some of them are probably losing money and always will - M or AMG products are very expensive, but they sell relatively few cars every year - their brands keep those cars to be leaders in their sectors, not because there's a huge amount of money to be made on them(good example of that is the Veyron made by the VW group - VW said that they will never make profit on that car, despite it costing over $1 million USD, because the research to make it was so costly. The only reason it exists and you can buy one is so that VW can say they make the fastest car in the world).

Tesla on the other hand, makes 3 models, they are not trying to cater to every single market, so they can afford the focus and very high profit margins that come with it.

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pbhjpbhj 3692 days ago
>despite it costing over $1 million USD, because the research to make it was so costly //

Does the research only apply to the Veyron? I'd be surprised if they can't use advances there in other lines of cars or get patents that they can profit from when used by other car manufacturers.

It does however speak to good marketing to say "we make this car for the love of making cars" rather than "we use this as a way of targeting R&D that we can then exploit in other vehicle lines".

/cynicism

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gambiting 3692 days ago
Well, that's a good point. I'm pretty sure VW uses technologies invented for the Veyron in their other cars, but I guess it's hard to estimate the cost/profit ratio in this case. In any case, the point I was trying to make was that other car companies don't maintain 25% profit on all of their vehicles like Tesla does, because they have a much more varied portfolio of models.
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