Atvm News - 2018 Fed Budget Proposal

[slinches]

If I recall, they were planning to ship the first Elios directly from the Shreveport facility to customers doors if they preferred. Then open up the marshalling centers as production ramped up while building out local storefronts. That seems like a perfectly workable plan that will ramp up with demand quite nicely.

Signing up with Pep Boys for service makes up for the lack of a dealership network on the service side and replacement parts shouldn't be an issue. The vast majority of functional components (alternator, compressor, starter, window/wiper motors, lock servos, ... etc) are all readily available and on the shelves at auto parts stores. The rest can be reserved off of the production line and sold as spares.

 

[Samalross]

If I recall, they were planning to ship the first Elios directly from the Shreveport facility to customers doors if they preferred. Then open up the marshalling centers as production ramped up while building out local storefronts. That seems like a perfectly workable plan that will ramp up with demand quite nicely.

Signing up with Pep Boys for service makes up for the lack of a dealership network on the service side and replacement parts shouldn't be an issue. The vast majority of functional components (alternator, compressor, starter, window/wiper motors, lock servos, ... etc) are all readily available and on the shelves at auto parts stores. The rest can be reserved off of the production line and sold as spares.

i don't think that people with low numbers, would want to wait six months or so, for a dealer to open . Also I doubt if it would be legal to sell out of the factory.

 

[Rob Croson]

Tell that to Elon Musk. He's got to be doing something right.

Had EM taken that approach from the beginning, it may have been viable. (Though I doubt it, simply due to the fact that the Elio is not, and cannot ever be, a luxury vehicle commanding such an outrageous price. The Elio only works due to its low price, enabled by volume sales. Also, EM simply cannot possibly switch to electric at this point. EM also cannot offer only luxury models for the first X cars delivered. They have touted their "ePlus" system, their low base price, and that you buy everything a la carte. They also have issued SILs to people, with no condition that they buy jumped up pseudo-luxury modesl. Trying to force people to "go big or go to the end of the line" would spur a class-action lawsuit. So there's really nothing in your post that EM can do now. Maybe they could have done it from the start. Implementing any of those things now would be a death sentence.

 

[Elio Amazed]

I may me delusional, but I am not paranoid. I still believe, I just don't expect to get run over by an Elio anytime soon.

Well gees, as much as it pains me to say it, I sure hope not Frim.

 

[Rob Croson]

But... That's talking about the dollar amount of sales.

Yes, it is sales, as opposed to profit. My point, however, is that the fact that EM has already spent the all-in money, and has to account for bonuses, etc., is already figured in to the $450M figure. That $450M is a worst-case projection that already accounts for all that stuff, and is still probably several million low. It over-estimates the bonuses owed, overestimates the discounts from non-SIL all-ins, underestimates the likely uncome from options, over-estimates the number of lockins, etc., etc. $450M is a low-ball amount. In all likelihood, it is well over $520M. (Especially considering that the options sales are thought to have a much higher profit margin than the base vehicle.)

It also only accounts for the first 65K vehicles to be sold. (They're still taking reservations, and are 200 over that amount. Who knows where it will be by the time they start making them.) Do you really think that EM is somehow supposed to magically recover all of their expenses, pay all their debts, and turn a healthy profit after selling only 65k vehicles? That's crazy talk.

Is $450M, or even $520M, enough? I have no idea. What I do know is that EM knows more than we do, and they seem to think it's enough.

 

[Samalross]

Elio Amazed said nothing about paying of their debts. You mention that they over estimated bonuses and discounts lock ins etc. How do you know this? Elio may know more than we do, but they sure have made many mistakes. They said the money from crowd funding would build 25 e series ( reduced to 22). They built two with engines and three gliders. If they are this inaccurate on other items, they will need billions to start production.

 

[RSchneider]

"Signing up with Pep Boys for service makes up for the lack of a dealership network on the service side and replacement parts shouldn't be an issue."

That brings up a good point. What happens if you don't live close to a Pep Boys. For example, St. Louis has no Pep Boys and the closest ones are in Chicago or Springfield, MO. I suspect that someone in the St. Louis metro area (2.8M people) will buy an Elio. What happens if the car just doesn't start one day and it's only 6 months old? What if all of the Elios need to have the rear wheel bearing changed under a safety recall because they were not installed right? Who's going to fix that? Do we just tell everyone in STL that you need to take it 200+ miles away to have warranty work done? STL is not out in the middle of nowhere, so what happens with a big metro area like that? We are talking about a $7K car not some $200K McLaren. Someone in STL is going to use their Elio to drive from Washington, MO to STL every day because it's economical. Lat thing the need is a car that's sitting in the garage broke down.

Elio will need to address that somehow because last thing you need is a bunch of Elios in certain areas of the country that are devoid of service and warranty. If you want bad PR, that'll happen in a jiffy. Again, this costs money and that's why the car business is different.

 

[slinches]

i don't think that people with low numbers, would want to wait six months or so, for a dealer to open . Also I doubt if it would be legal to sell out of the factory.

Why would it be illegal to sell a product and ship it to your customer? Tesla does this already already.

And EM has answered the question for places that don't have a Pep Boys nearby, they will work with local shops to handle the warranty work.

 

[booboo]

It needs to be said again. The Elio is a mass production vehicle. The logistics of getting them to customers, and finding authorized service centers has been talked about at length by Paul and Elio Motors. They have extensive plans.
They also have a plan for production. The only thing standing in the way of these plans is adequate funding to get them rolling.

Cheer up.

 

[Maurtis]

Why would it be illegal to sell a product and ship it to your customer? Tesla does this already already.

And EM has answered the question for places that don't have a Pep Boys nearby, they will work with local shops to handle the warranty work.

Tesla does it, but not without issues: https://en.wikipedia.org/wiki/Tesla_US_dealership_disputes

Apparently it varies by state and here in Texas there are certain hoops you have to jump through that someone in CA would not. So Elio would likely also run into these issues as well unless they get creative with ownership of the marshaling centers?