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by legitster 1203 days ago
The cost per vehicle (all expenses total/ # of vehicles) may be 3x the sale price, but the marginal cost (the cost to produce one more car to sell) is still less than the sale price.

An important distinction. Otherwise selling cars would cost them money.

1 comments

COGS per vehicle is still way more than twice the average selling price. Yes, selling cars costs them money. They have to figure out how to make the manufacturing process use fewer and cheaper parts, less labor, etc. It is a difficult problem because scaling only offers incremental improvements to COGS.