When will the C7 be sold at 10k under MSRP?
06-22-2013, 05:23 PM
#42
Team Owner
The past four years they have been running at 10-12,000 a year, and the plant has the capacity for about 35,000 a year (or more). Unless sales triple for the C7, they will see bigger discounts sooner than you think.
06-22-2013, 05:25 PM
#43
Team Owner
GM doesn't give a crap how much the dealers make on the C7. They make money by cranking cars out, and even if they have to offer a $3000 rebate they can make way more money selling 50% more vettes. There is a tremendous fixed overhead to run any UAW or CAW automotive plant and that must be covered by higher production levels.
At 1,000 cars a month they can't make money on the vette
At 1,000 cars a month they can't make money on the vette
06-22-2013, 05:29 PM
#44
Team Owner
$10K off MSRP is do-able, sometime. I just don't know when.
BUT, as said above, there won't be $10K off a very base, no-options Stingray. Matter of fact, there never was, even in the C6 era. There was, however, as much as $5K off a stripped, no-option C6 which began as early as '07 models, the third model year.
As to GM making cars, and lots of them regardless of how they sell at the dealers, that's possible but not probable. And very unlikely. Witness: the last three or so model years of C6. GM did not produce the 2008 run of 35,000 cars in '09, '10, '11, '12, etc. In most of those years, every year they trimmed production numbers in anticipation of lowered demand for the next year.
And as to making, or not making money on 12,000 cars sold per year, with the sunk costs already paid off years ago during the C6 run, modified wages and benefits, as well as the sharing of parts among lines/models, I'd say the car was profitable for GM even with about 1,000+ units sold per month in the last two years. At least, if I were in finance/accounting, I could make the case for GM. And I bet the smart types at GM could do the same for the C7 model run, too.
BUT, as said above, there won't be $10K off a very base, no-options Stingray. Matter of fact, there never was, even in the C6 era. There was, however, as much as $5K off a stripped, no-option C6 which began as early as '07 models, the third model year.
As to GM making cars, and lots of them regardless of how they sell at the dealers, that's possible but not probable. And very unlikely. Witness: the last three or so model years of C6. GM did not produce the 2008 run of 35,000 cars in '09, '10, '11, '12, etc. In most of those years, every year they trimmed production numbers in anticipation of lowered demand for the next year.
And as to making, or not making money on 12,000 cars sold per year, with the sunk costs already paid off years ago during the C6 run, modified wages and benefits, as well as the sharing of parts among lines/models, I'd say the car was profitable for GM even with about 1,000+ units sold per month in the last two years. At least, if I were in finance/accounting, I could make the case for GM. And I bet the smart types at GM could do the same for the C7 model run, too.
If the C7 sells in 12,000 car volumes the first few years it's going to take a hell of a lot more cars (or higher prices) to amortize the fixed costs.
Just my opinion of course. There may be people with better knowledge of the internal accounting at GM. But that seems like accounting 101 to me.
06-22-2013, 07:51 PM
#45
Le Mans Master
I'm trying to be kind here - that is laughable. There will be C7s sold by the end of year one for more than $2-3k off. I suppose some miracle could happen and make me wrong, but I doubt it. I bought a C6 nine months after they started building them for employee pricing plus a $1000 incentive - $11,000 of MSRP. To the dealer is was like selling a car at $500 over invoice. And that was when they were still running at 30,000 a year pace.
The past four years they have been running at 10-12,000 a year, and the plant has the capacity for about 35,000 a year (or more). Unless sales triple for the C7, they will see bigger discounts sooner than you think.
The past four years they have been running at 10-12,000 a year, and the plant has the capacity for about 35,000 a year (or more). Unless sales triple for the C7, they will see bigger discounts sooner than you think.
Last edited by Supersonic 427; 06-22-2013 at 07:55 PM.
06-22-2013, 08:40 PM
#46
Team Owner
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St. Jude Donor '15
"In honor of jpee"
Bill, I don't think you can say that GM "trimmed production". They build what dealers order. GM was able to do things with the C6 that they can't (yet) do with the C7. The C6 sold in big numbers for a few years which allowed them to amortize a lot of fixed costs in R&D and tooling of the C6. That is how they got by selling 12,000 a year in the later years and living to tell about it.
If the C7 sells in 12,000 car volumes the first few years it's going to take a hell of a lot more cars (or higher prices) to amortize the fixed costs.
Just my opinion of course. There may be people with better knowledge of the internal accounting at GM. But that seems like accounting 101 to me.
If the C7 sells in 12,000 car volumes the first few years it's going to take a hell of a lot more cars (or higher prices) to amortize the fixed costs.
Just my opinion of course. There may be people with better knowledge of the internal accounting at GM. But that seems like accounting 101 to me.
We can also argue if the economy is better or not but what is unarguable is that there is a new gen Corvette being produced and it has a price, for now, close to msrp.
Maybe it's accounting 101 but if I were in GM, I'd be looking at all of the upside potential of producing flat out (18+ per hour) with and without incentives, rebates, etc.. And I'd be looking at the downside of reducing production to something approaching what it has been for the last few years, and taking a small bath (in profitability) for those years. I'd call that strategic planning 100.
All the wonderful hype so far is encouraging, but when it tails off, and it will, what then? Just exactly how many flush-with-cash buyers are there, or converts from other makes? And are the numbers there to run a line at 18+ per hour, or more? Maybe not right away.
My prediction is that the model run may be as long as the immediate prior gen, nine model years (it has been longer in older generations) even tho product cycles seem to be getting shorter for some other cars. The reason is financial as you said, to amortize costs. And I do see prices softening sooner than later.
While GM and probably most others didn't predict the economic downturn, I'd venture that GM is planning a steady-to-ramped-up-production over the longer term to recoup costs and make money on the C7--a risky methodology for sure. But car companies don't just "bet" models; sometimes, they "bet" the whole company. That is not the case here.
06-22-2013, 09:29 PM
#47
Race Director
There were discounts on 1999 c5 s and beyond. Please also consider the economic meltdown in the fourth quarter of 2008 having an unexpected negative impact on luxury items.
06-22-2013, 10:38 PM
#48
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St. Jude Donor '06-'07-'08-'09-'10-'11-'12-'13-'14-'15- '16-'17-‘18-‘19-'20-'21
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Originally Posted by Greg00Coupe
Who has that crystal ball? What will the economy do? What if we have another terrorist attack? And most important what if god forbid we get a medical challenge which makes us wish we paid sticker??????????
Isn't the ex wife moving back the same thing as a terrorist attack !!
Who has that crystal ball? What will the economy do? What if we have another terrorist attack? And most important what if god forbid we get a medical challenge which makes us wish we paid sticker??????????
Isn't the ex wife moving back the same thing as a terrorist attack !!
06-23-2013, 12:00 AM
#49
I think there will be a refresh at some point, similar to the C6, and the leftovers will see some big discounts. 8 spd auto, horsepower bump, and maybe some changes to the rear styling would definitely bring some big discounts. So would a GS style widebody version. Until these changes come I can't see 10k off unless the economy implodes.
06-23-2013, 01:17 AM
#50
Pro
I'm not absolutely certain. My crystal ball says July 17, 2014, but my tea leaves say July 18. I'm gonna check my Tarot cards and try to get back to you with a firm date.
In other related news the C7 Z06 will be released for sale on August 23, 2014. I've absolutely confirmed this with Madame Beatrix on the Psychic Hotline.
(sarcasm off).
In other related news the C7 Z06 will be released for sale on August 23, 2014. I've absolutely confirmed this with Madame Beatrix on the Psychic Hotline.
(sarcasm off).
Last edited by Stingray Sam; 06-23-2013 at 01:22 AM.
06-23-2013, 02:02 AM
#52
Le Mans Master
I believe this is exactly on point. There was an article some time back that had someone from GM talking about their new marketing and production stratagies. They said that they are going to reduce supply inventories from 60 something days to forty or something like that. Basically moving to the philospophy of 'keeping supply one less than demand'. If they execute this well, the only thing that would create a large discount would be unexpected unpopularity of the car.
06-23-2013, 03:19 AM
#53
Le Mans Master
Bigger discounts will appear a shortly after a few magazines/websites say the C7's interior looks cheap, seats are junk or the 'infotainment' system sucks. It happened to the C5 and C6, I'll bet it will happen to the C7, too.
Last edited by Virtual Geezer; 06-23-2013 at 03:22 AM.
06-23-2013, 06:14 AM
#55
Race Director
A three year old off lease c7 with 36k miles will go for ten grand off msrp
06-23-2013, 07:26 AM
#56
Team Owner
I understand both yours and joe's statements re who really "orders" the cars and why GM produces the number of cars they do. That wasn't my point. Regardless of incentives, capacity to produce, etc., the numbers speak for themselves: production reduced just about every year from 2008 on, as did actual sales to live customers (sitting on a lot may be a sale to GM, but isn't really since it's never been titled).
We can also argue if the economy is better or not but what is unarguable is that there is a new gen Corvette being produced and it has a price, for now, close to msrp.
Maybe it's accounting 101 but if I were in GM, I'd be looking at all of the upside potential of producing flat out (18+ per hour) with and without incentives, rebates, etc.. And I'd be looking at the downside of reducing production to something approaching what it has been for the last few years, and taking a small bath (in profitability) for those years. I'd call that strategic planning 100.
All the wonderful hype so far is encouraging, but when it tails off, and it will, what then? Just exactly how many flush-with-cash buyers are there, or converts from other makes? And are the numbers there to run a line at 18+ per hour, or more? Maybe not right away.
My prediction is that the model run may be as long as the immediate prior gen, nine model years (it has been longer in older generations) even tho product cycles seem to be getting shorter for some other cars. The reason is financial as you said, to amortize costs. And I do see prices softening sooner than later.
While GM and probably most others didn't predict the economic downturn, I'd venture that GM is planning a steady-to-ramped-up-production over the longer term to recoup costs and make money on the C7--a risky methodology for sure. But car companies don't just "bet" models; sometimes, they "bet" the whole company. That is not the case here.
We can also argue if the economy is better or not but what is unarguable is that there is a new gen Corvette being produced and it has a price, for now, close to msrp.
Maybe it's accounting 101 but if I were in GM, I'd be looking at all of the upside potential of producing flat out (18+ per hour) with and without incentives, rebates, etc.. And I'd be looking at the downside of reducing production to something approaching what it has been for the last few years, and taking a small bath (in profitability) for those years. I'd call that strategic planning 100.
All the wonderful hype so far is encouraging, but when it tails off, and it will, what then? Just exactly how many flush-with-cash buyers are there, or converts from other makes? And are the numbers there to run a line at 18+ per hour, or more? Maybe not right away.
My prediction is that the model run may be as long as the immediate prior gen, nine model years (it has been longer in older generations) even tho product cycles seem to be getting shorter for some other cars. The reason is financial as you said, to amortize costs. And I do see prices softening sooner than later.
While GM and probably most others didn't predict the economic downturn, I'd venture that GM is planning a steady-to-ramped-up-production over the longer term to recoup costs and make money on the C7--a risky methodology for sure. But car companies don't just "bet" models; sometimes, they "bet" the whole company. That is not the case here.
GM has to be crossing their fingers and toes that the new model brings volumes back at least to the 25,000 a year range. I'm guessing they would be okay with that. But under 15,000 a year as has been the case since the market collapsed is probably not good - especially given that they have kept the pricing effectively the same.
06-23-2013, 09:03 AM
#57
Team Owner
I got a $1,000 discount in 1997 on my C5 that I special ordered to my specs. I could have gotten $1,500 off one that was in stock at Bud's but I didn't want a green C5.
06-23-2013, 09:16 AM
#58
AIR FORCE VETERAN
Everyone can state an exception. All the Forum members look at Corvette in a different maner then the general population. It is the true Corvette fan that kept the car alive during the lean years. In my opinion. The general public has not seen or seen very little of the new car. We, on the other hand, search for every bit of information. There will be a surge in demand for the C7 when it hits the streets. Judging demand from what is written on the Forum is not a good measure. If the economy does not collapse we will see a demand that will go on for at least 20 months. IMO. I will be drving mine in October. When we have them that is when the demand will build.
06-23-2013, 09:39 AM
#59
Racer
Of course I expect this would include my Corvette loyalty bonus & my GM card max rebate...
Is there such a thing as a Corvette loyalty bonus? Never heard of such a thing. If it is true, what do you need to do to get it?
Is there such a thing as a Corvette loyalty bonus? Never heard of such a thing. If it is true, what do you need to do to get it?
06-23-2013, 09:45 AM
#60
Team Owner
GM has offered a Corvette "loyalty" bonus in the past on new Corvettes. It's one of those "incentives" that I mentioned earlier to spur sales by GM. Don't expect any "incentives" from GM on a new Corvette yet. Discounts now being offered by some dealers on new C7's are out of the dealer's pocket, not GM's.