I am positive that automakers know this but they are chasing higher profit margin models. Unfortunate short term thinking.
You’re absolutely correct. All automakers have abandoned small cheap cars because they don’t actually cost that much less to manufacture than massive tank-cars.
Imaginary example to illustrate this:
Car A: small hatchback with basic cloth seats, 50KWh battery, standard satnav/stereo system. With $2000 of materials, $10,000 of manufacturing and labour, and a sale price of $20,000, for a profit of $8000.
Car B: SUV shaped faux-luxury car with leather seats, 80KWh battery, the same stereo, and fake wood and chrome covered plastic all over it. $3000 raw materials, $15,000 of manufacturing and labour, but it sells for $65,000, this automaker gets a profit of $47,000!
It’s easy to see why they’re doing this. By making their cars enormous and expensive but with long financing terms they can create “mandatory luxury”.
i want the toyota IQ back!
A smart-sized car that lasts a toyota amount of time and has like 70HP stock. literally one of my dream cars.
With the state of the supply chain it doesn’t make sense to use all available resources on cheaper models and limit the amount of high profit models being built.
Automakers chase profits, being green is just a side product of the current trends.
I’m not surprised. This is the one big reason I’m still remotely considering a Tesla model 3 performance. Ethically I’m not sure I can justify it, but I’m in the market for something quick, electric, and affordable. And everything I’ve looked at is just a lot more expensive and not quite as quick. Which are the things I’m most interested in.
They may be hoping for an interest rate drop so that overpriced cars are feasible again. The rate hikes definitely put a kink in their “overcharge early adopters” plan.
The Chevy Bolt EUV (the EUV is the slightly larger one) checks all but the quick box. I test drove one recently and it was nice, and affordable. I’m strongly considering it. It’s also built with union labor if you’re interested in supporting that.
Dont worry china is doing that. You will see BYD soon.
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