How cheap could a new car be built?

frenchyd said:

rob_lewis said:

I had a long reply that highlighted the points above as to how a cheap car wouldn't be successful, but realized that's not the question.

I would guess, if you kept it to a low safety regulations market, were able to buy all the materials for a million cars with one payment (i.e. bulk discount) and don't calculate in the up front cost of the robots, buildings, equipment, etc, I'd guess you could make a car as cheap as $1k.  You mentioned range, but not speed, so if you kept it under 40mph, a decent off the shelf 150 or 250cc motorcycle or moped motor would be cheaper than an electric motor and batteries with a 100 mile range.  Basically, a gas powered golf cart with windows.

Again, assuming you're to the point that you're just making the vehicles and the upfront costs have already been paid for. 

-Rob

 

 

Rob I wasn't thinking a third world car.  Although that should be part of its market if it's well built. 
  Several people here are hearing the word cheap and thinking poorly made unreliable.  
  Can I remind you of VW? Post WW2?   
    They were cheap and efficient and sold extremely well.  Started the compact car movement ( which led to the muscle cars etc)••••• 

  My point is a body and chassis made of recycled plastic has real advantages. ( not just cost)  spending  hundreds of millions periodically to create a New  version of the same car doesn't really help society.     
     We don't need to stop selling pickups or SUV's whatever but Elon Musk was right about the Tesla selling to a new market. Maybe the time is right to create  a new cheap sedan?  People need transportation. Cut the costs out and maybe America could lead the world again. 

You do realize that it's not the 1950's anymore, right?  And the number of used cars to choose from is much higher- in 1970, the number of registered cars in the US was about 90M, and now it's about 275M.  That's an increase of 3x when the population went from 200M to 330M (not even doubling).  There are SO many more cars available now vs when the VW was getting to the end of it's production- there's no need for a cheap POS VW.  We went from one car for 2.2 people to one car for every 1.2 people.

As for SUV's and pick ups, you need to convince the consumer to stop buying them.  Forgive OEM that make cars that people are willing to spend money on.

Oh, and one more thing- cars ARE made of recycled materials.  Even the plastic in the interiors.  

In reply to alfadriver :

Would you have been happier if I said Fiat?   Well it doesn't apply because Fiat didn't develop a strong dealer network. 
 Frankly  your point about the population  works.  (And it's true)   At one point my family had 9 cars. 2 daughters, a wife,  and my daily driver/ company car.  But I also had 2 vintage  race cars plus my MGTD a tow truck and a Morris Minor Traveler  . Oh and various bitsa.  
  But I could a used a cheap commuter to chase parts etc. 

  Now you want me to compete a new really cheap car against a high mileage cheap used car?  Both at about the same price?   

      For the same reason I rarely worked on my own boat, I'd pick the new one.  I just didn't have time to work on one more car.   
 What would your choice be? 
      As far as what should be built? It's not my call. It's the markets.  Sell pickups, SUV's sports cars.  It's just that except for EV's  sedans aren't selling   Not enough to be money makers. 
       

frenchyd said:

SV reX said:

In reply to frenchyd :

I said that earlier. You can't sell electric cars in a place that doesn't have a reliable electric grid. 
 

And you can't sell $7000 cars in the US. 

True but why not?   VW was a cheap car when ntroduced  and people fell in love with it.   I get why it sold in Germany.
  But 10 years after our vets came back from Germany they were selling well here.  As far as cars go they were under powered, had a poor HVAC system.  Really basic. No features like A/C  automatic, power steering,  etc. 

  They were cheap. No style or class, dull color choices.   
  Yet sales grew and grew until Even GM was imitating them. Basically starting the whole compact car thing.  

Your example of VW proves my point. 
 

VW can't make Beetles any more because they wouldn't meet modern standards. They wouldn't pass crash tests, lack all modern safety design features like air bags and ABS, and can't pass emission testing. 
 

All the things you want to remove to make it inexpensive are REQUIRED in modern new vehicles in the US.  You can sell a $7000 vehicle in India, but you can't sell it in the US. 
 

It's not possible to build a modern vehicle that passes NHTSA standards and testing for $7000.

Worse than that... even if you could build a car for $7000, no one would buy it.  There is no market for it, and there are no profits to be made.

In reply to frenchyd :

Please stop accusing people of failing to read.  You do it a lot. It sounds really arrogant and condescending. 
 

I know how to read. 

Huh, I thought a canoe dug this old thread up, but no, seems like I'm the only one that remembers Frenchy having this exact thread 3-5 times over the last couple years. 

In reply to RevRico :

You're not the only one. 

frenchyd said:

In reply to alfadriver :

 

  Now you want me to compete a new really cheap car against a high mileage cheap used car?  Both at about the same price?   

You really need to stop thinking that you represent the rest of the automotive buying public.  Because the buying public has been making that choice once used cars turned out to be reliable.  Unless you actually think that a $7000 new car will be nicer and a better investment than a $7000 10 year old used car.

And I'm also not sure where you get your info that an EV is cheap to make.  They very much are not.  Batteries are still incredibly expensive, and will be until the quantum change in battery make up is completed.

Still, if you think you know so much about making cheap cars, I encourage you to join one of the OEMs and work on your magical project.

Cars are intertwined with social status and standard of living.  People don't aspire to buy a E36 M3ty new car.  Even in emerging markets, they want a globally comparable/competitive car where the infrastructure supports it, or they just ride a motorcycle.  

So the baseline for a car means that it has to look like a car and you start to approach a price and features similar to what we already see for entry level cars.   If you strip out options or fundamentally change that formula, then you end up with a product that is not-a-car.   The motorcycle is unbeatable for economical transportation that is not-a-car. 

For the exercise of building cheap ass basic new car for emerging markets, you cut out the R&D budget by licensing or copying a production line that is deprecated.  But the product has to be good and it has to offer enough content , status, and comparable pricing to beat out a 5 year old used car.

frenchyd said:

pres589 (djronnebaum) said:

Mass transit makes more sense iin your use case.  It does in a lot of cases.

 I'm sorry mass transit really only works near regular lines.  If you want to go from an outer ring suburb to the next suburb over  you take the bus/ lite rail into the city and then back out again possibly  still leaving you with a major walk at each end.  And that's after 2 hours of sitting and waiting.  
   

frenchy, don't you drive a bus?  Does *that* really work??

In reply to alfadriver :

3-4-500 horsepower electric motors aren't cheap, you are right.  Nor are enough batteries to get 300+ miles in a 4000# car.  Again you are right.  
   Then self driving or hands free options, all kinds of warnings and alerts.  Plus a big screen of choices  probably adds a whole lot of cost as well.   
        Interiors carefully designed to showcase luxury.  Again extremely expensive.  Big wheels and wide tires? They sure look good but really add to costs. 

  But you know what?  Not everyone feels they need  or want  those things.
    
Buying a  20 year old car  is something most people do because they can't afford another choice.  
   You and I are really fortunate enough  to know how to repair those. Deal with the inevitable neglect.  Purchase only what we feel has been suitably maintained.   Not so for most people. Instead of a few hours of weekend labor  and a couple of hundred dollars to repair worn brakes they will fork over $1000 maybe more.
    Given the stats on how few people even have $400 for an emergency  that car they recently bought is going to force them deeper in debt.   They then have  to ignore worn suspension, balding tires  and the reluctance the car has been to starting lately.  
  Problems that you and I can fix with a little time and a little cash  are neglected until it's towed in.  
      Single mothers, the elderly, families working 3-4 jobs to make ends meet  they don't pay cash for something they want and then spend more to get it back to near new condition.  
     It's not a car to them. It's transportation. They want something that is a monthly payment inside their budget. Period.   
  Some wealthy will even take perverse pride in driving such a modest car.  
  
Part  of the goal of this project is to export cars.  Reliable affordable transportation.    A country that fails to export at least as much as they import is doomed to failure. 
     

Others have said it, but I think the thing that Frenchy is missing is that the public, in this country and every other, do not want an odd looking micro car with zero features.

Frenchy keeps talking about the original Beetle, but he's missing what the Beetle was in the day.  By todays standards it's a tiny,noisy, uncomfortable, smelly, unsafe death machine if in a head on with a 3,500lb crossover, let alone a 5,000+ Lb SUV or pick em up truck.  Back in the 50's and 60's it wasn't that much smaller, less safe, worse performing than smaller/midsize cars from other manufacturers in this country.  In Europe is was not even considered a small car.  There was a brief honeymoon period post war where micro cars, which the Beetle, MINI, Imp etc. were not, were in vogue.  But the 'average' car at the time was much, much smaller than the average car today, and based on existing technology, they weren't 'bad' cars.  That era is long long gone and so has the market pull for tiny basic cars. 

The closest to a micro car success story in the last 40 years has been SMART who pulled out of the US in 2019 after only 12 years and average sales of about 12k units per year.  For the rest of the world they've averages around 90K units per year for 24 years now.  But the SMART isn't a cheap car, and has amazingly good safety for a car that size.  Building a deformable crash structure to dissipate energy before reaching the occupants is very difficult and not cheap for a small car that size.  Things like the Renault Twizy, despite being the closest thing to what Frenchy is describing took four years to reach 15,000 units total sales but in reality limping along at a few hundred to a few thousand per year.  The Fiat 500, and it's Ford Ka twin, has done reasonably well in Europe, but never taken the US by storm.  The smallest car the US has any track record of buying in the last 30 years is the MINI, but I believe that's just as much to do with the 'quality European' image, and the fact they are a ball of fun to drive and feel like a squirrel on crack, but they are not cheap.

The other thing is the people who Frenchy views as the target audience, aren't interested in a tiny crush box.  Newer generations are viewing personal transport less and less as an expression of freedom, and more and more as a waste of resources.  Across the buying spectrum, and not just in this country, safety, efficiency, connectivity, driver aids, passive safety etc. are all now selling points.  A car made to be cheap that finds a way around the safety features and missing on the technology is setting itself up for failure.

Smart, Twizy, Gordon Murray Design, Tata etc. have all poured billions of $$"s into versions of Frenchy's idea over the last 25 years with only the SMART having any real traction, and that was not a cheap car.  The global market has spoken.

I think to answer Frenchy's original question "How cheap could a new car be built?", $7K is a reasonable number for something that could be sold in the US.

"Would people want it?", "Would it be profitable at scale?", etc. are all different questions, and the answer to all of them is "No".    

frenchyd said:

Buying a  20 year old car  is something most people do because they can't afford another choice.  You and I are really fortunate enough  to know how to repair those. 

Not trying to argue the point, but poor people are incredibly resourceful at keeping E36 M3ty old cars alive with next to nothing for resources.  

For the purpose of the exercise, I would suggest that said cheap car would need to have a core characteristic that offsets the inevitable lack of content.  If you make it cheap, make it fun to drive.  I had an 86 Honda CRX HF.  No power, no features, but somehow it managed to be super rewarding to drive.  And routinely got over 50mpg.

To sell in this market, the car would need an image other than "I literally can't get financed by anyone other than Mitsubishi."

frenchyd said:

Buying a  20 year old car  is something most people do because they can't afford another choice.  
   You and I are really fortunate enough  to know how to repair those. Deal with the inevitable neglect.  Purchase only what we feel has been suitably maintained.   Not so for most people. Instead of a few hours of weekend labor  and a couple of hundred dollars to repair worn brakes they will fork over $1000 maybe more.

Sorry Frenchy, I have a lot more tolerance for what you say than many here, but you are simply wrong.  My kids are 21 and 27.  One in Uni, one in Vet school, so I know a lot of their friends, and I know the kids of a lot of my friends.  I've know a lot of collage age kids driving around in old cars over the last 15 years.  I will tell you now those kids are/were driving around in 10-20 year old cars that they or their parents paid $500-3,000 for.  I'll tell you a lot of those cars are running around with significant mechanical defects that the average GRMer would park the car until fixed for, but to them and their parents they are 'fine' for going to and from school/work etc.  Another absolute truism, both for the young adults and their parents, every one of them without fail wants to be in an old Volvo, Taurus, Civic (this century, not baby Civi's), Focus, Escape as smaller cars are seen as unsafe.  I know one family where the 'kids car' was swapped from a Toyota Yaris to a Volvo S60 because the Yaris 'was too small to be safe'.  People simply don't want itty bitty teeny weeny yellow polka dot micro car.  They want a 'real' car. 

ProDarwin said:

I think to answer Frenchy's original question "How cheap could a new car be built?", $7K is a reasonable number for something that could be sold in the US.

"Would people want it?", "Would it be profitable at scale?", etc. are all different questions, and the answer to all of them is "No".    

I'll be honest, I am not entirely sure that the answer to how cheap could a car be built is $7k. Maybe by a very large manufacturer that already has logistic supply lines and quantity of scale and the possibility of using carryover parts from other models (reducing tooling and R&D costs) but I am not entirely sure of that. I am betting more like $10k. For a start up, even to break even as a car and not a 3 wheel motorcycle, I doubt it. 

As to the other parts, yes. 100% agree.

Even the infamous 'Elio' vaporware scam, who's business model has been analyzed and debunked many times in the press over the last 14 years, are now showing $14,900 for their imaginary electrical version.

In reply to frenchyd :

I had a long reply to one of your posts, but you don't really *read* the replies that point out the real holes in your posts.  So there's no real point in extending this dream of a car.

We will never be able to disengage the technical abilities to build a car from the business necessity to be profitable. 
 

"Can a car be built cheap?" The answer is always "Yes".  

"Can a car company build a car that is not profitable?" The answer is always an absolute "No".

 Therefore, it can't be built that cheap.  It is physically impossible to build a product that is not desirable at a price point that is attractive.

My answer to the question at hand is somewhere between $10K and $15K. This takes into account the regulatory issues, the liabilities, the warranties, and the business necessity to be profitable.

Remember, we are to "Assume annual production of a million plus"  Thats more than the F150 sells, by a large margin.

Those are big numbers.  Last year the spark MSRP was $14xxx.  What's the production cost for that?  $10k?  $8k?

There are lots of opportunities for cost cutting there.  It still has 2 side mirrors, A/C, heat, radio, complex headlight and taillight assembles, etc. 

I don't know how the powertrain costs compare ICE vs EV.  If you kept that ICE I'm sure the costs be be crazy low mated to a 4spd manual.   

Random google shows battery costs of $100/kwhr on the low end, so thats going to end up too expensive no matter what.

In reply to SV reX :

To me, I honesty have no idea.  The best I can say is that the simplest powertrain is probably in the $900-1200 range.  And it would not really be the best option for super high fuel economy.  

If you REALLY want to build cheap, then my suggestion is that it can't be a for-profit company.  It's simply not a viable business model.

Start a non-profit that enables people to build their own car with free labor in some sort of maker space.  Have 3 or 4 simple designs. Raise donations for the funding. Teach people the skills to build their own vehicles and maintain them.  Set up multiple micro business non-profit maker spaces across the country, and enable them to network with each other to gain the purchasing power for volume discounts.

But a for-profit business?  Nope. 

In reply to ProDarwin :

A second random google search suggests that for each kw-hr you get 4 miles.  So to get 100miles, you need 25kw-hr. Which would be $2500 just in batteries.

In reply to ProDarwin :

Annual production volume of a million plus requires annual sales of a million plus. That's 3X as many Camrys as are sold annually. 
 

Perfect recipe for bankruptcy. That will cut production to ZERO.

SV reX said:

If you REALLY want to build cheap, then my suggestion is that it can't be a for-profit company.  It's simply not a viable business mode.

Start a non-profit that enables people to build their own car with free labor in some sort of maker space.  Have 3 or 4 simple designs. Raise donations for the funding. Teach people the skills to build their own vehicles and maintain them.  Set up multiple micro business non-profit maker spaces across the country, and enable them to network with each other to gain the purchasing power for volume discounts.

But a for-profit business?  Nope. 

I really hate to point this out- but having people DIY cars like that is very, very expensive.  That's why robotic assembly lines were made.