Positive News From Elio

[Sam]

For those who keep asking about the E series and 100 vehicles, I'm wondering if you ever created a new car company or been involved in one? Starting any company is difficult, let alone one of this magnitude.

Hmm. Never heard that before.

 

[wizard of ahs]

http://www.ktbs.com/story/34448215/...o-speaks-exclusively-with-ktbs-3s-shon-gables

 

[Grumpy Cat]

You have to remember what he's trying to accomplish. It would be like if I decided to climb Mt. Everest by myself. I can have all of the grit and determination of anyone, but I do have to be realistic. This is where Elio should have started off a bit smaller as opposed to going from nothing to trying to produce 250K cars per year that is going to meet some lofty goals. Maybe like 20K per year for 2014-2015, then a updated version and a production increase of 20K per year for 2016-2017. Cash flow is key at this point. We can talk about how Tesla is still in the red but they have cash flow and are producing product. In addition to that, he had a boatload of personal money he threw at the project early on. From the looks of things, Elio did not have that kind of initial capital, thus has been behind the 8 ball from the very beginning.

Actually, it costs 1.5x more to expand a building than it does to start out from scratch. Do you know how difficult it is find a new location if you are going to move operations? Would you rather have 1 big building or several smaller ones (which increases overhead/headcount). It costs Elio nothing more to have that huge location to produce 80k (just giving a random number) vehicles and being able to produce 250k if there is that amount of demand. How many parents would want to give their high school and college kids a cheap and reliable car verses some clunker? How many people drive by themselves (which is what this car is marketed for) to and from work?

I've said it before and I'll say it yet again, how many companies have you heard of being flush with cash when they started? How many had huge debt when they started? Think of it this way, did you pay for your house with cash and have money left over, or did you make payments over time? Yeah, that's what I though...

 

[AriLea]

For those who keep asking about the E series and 100 vehicles, I'm wondering if you ever created a new car company or been involved in one? Starting any company is difficult, let alone one of this magnitude.

We had one individual in the Yahoo.Cabinscooters group a few years ago. And I think someone did show up here once too. One of the two consulted with Tesla and a few others.
Like that group, we have many people who have followed the trajectory of various startups to build unique car designs. None are as interesting a business model as the Elio.
The opinions I've heard from our 'better informed issue followers' are very consistent with what that individual had to say about it. And all the pros and cons were exhibited.
So using the name of something like sparrow or corbin or tesla to search this forum (or the Yahoo.Cabinscooters), you'll find all you need to know to make your own assessments.

I notice you might have to join to search that yahoo group..
https://beta.groups.yahoo.com/neo/groups/CabinScooters/info?referrer=Berkeley-USA

 

[Ty]

Grumpy Cat nailed this. Don't get hung up on "Paul should have planned to build 20K first and then move up from there..." There is absolutely zero cost involved in changing from 20K to 250K now that Paul has secured the old GM factory. That factory line can run slow enough to produce 20K easily enough. Elio won't have to do that. Instead, Elio has rented a fully operational plant for probably a LOT less than it would have cost to start from scratch to "just build 20k". What DOES happen because Paul started off with a big number is it gives Elio some negotiation space. Suppliers who are tapped to build parts for Elio have the same similar startup costs whether they build 20K parts or 250K parts. By spreading out the initial costs over 250K, the supplier can operate with less of the initial overhead in every part.

If it cost you $100 to build a lemonade stand and you sold 100 cups, you'd have to charge $1.00 per cup just to cover build costs. But, if you sold 1,000 cups, you only have to charge $0.10 per cup to cover build costs. Of course, it's a lot more complicated that this example but it makes a TON of sense to start big and go from there. Tesla almost HAD to start slow because they knew once they started pumping out cars, the tech would change and they didn't want to get caught having to build thousands of outdated cars. Elio won't have that problem.

Strickly from an industrial engineering point of view, it's better to have more capacity than you'll need than need more than you have. (unless the extra space slows production which won't be the case here)

 

[Kuda]

Grumpy Cat nailed this. Don't get hung up on "Paul should have planned to build 20K first and then move up from there..." There is absolutely zero cost involved in changing from 20K to 250K now that Paul has secured the old GM factory. That factory line can run slow enough to produce 20K easily enough. Elio won't have to do that. Instead, Elio has rented a fully operational plant for probably a LOT less than it would have cost to start from scratch to "just build 20k". What DOES happen because Paul started off with a big number is it gives Elio some negotiation space. Suppliers who are tapped to build parts for Elio have the same similar startup costs whether they build 20K parts or 250K parts. By spreading out the initial costs over 250K, the supplier can operate with less of the initial overhead in every part.

If it cost you $100 to build a lemonade stand and you sold 100 cups, you'd have to charge $1.00 per cup just to cover build costs. But, if you sold 1,000 cups, you only have to charge $0.10 per cup to cover build costs. Of course, it's a lot more complicated that this example but it makes a TON of sense to start big and go from there. Tesla almost HAD to start slow because they knew once they started pumping out cars, the tech would change and they didn't want to get caught having to build thousands of outdated cars. Elio won't have that problem.

Strickly from an industrial engineering point of view, it's better to have more capacity than you'll need than need more than you have. (unless the extra space slows production which won't be the case here)

Watch it, you're making way
to much cents!

 

[Ty]

Here's some good news: The configurator is a LOT faster now. They DID just give me a new computer here so that could be it but still.

 

[Rob Croson]

I can't even get it to load.

 

[CrimsonEclipse]

The problem with the moderate to low volume approach is that it would be nowhere near the $7300 base price. Why buy a $11,000+ base model Elio when you can get a Versa for just a bit more?

Versa doesn't get 84 MPG.

 

[slinches]

True, but the overall value proposition diminishes rather quickly as the price goes up. It's only a few hundred dollars a year saving on gas between the Elio and a Versa (12k miles/yr and $2.75/gal). The disadvantage of only being a two passenger vehicle (or one passenger + any meaningful cargo) needs to be made up somehow and I don't think the better mileage will do it on its own.