Mikec7z

Edit: Thread title should have been:
"C8 Reveal date announced before c7 final edition announced, NOT wise for c7 sales"

Not that I have any skin in the game, so it does not hurt me one iota either way...

but i feel like the NY C8 reveal... of the 7/18/19 reveal... was bad for c7 sales.

I dont understand why GM would not wait, and have that car spotted a week or 2 before the reveal?

half of april may june and half of july... 3 full months, they will have a hard time selling c7's for sure

And then the people who wait that long to see the c8, well whats another year of waiting to get a c8?

I think a better way for GM to have gone is NOT put the reveal date on the car, but had Tadge drive it if they really wanted to, and told people that the car will most likely not be for sale for another year. Keep c7 sales as strong as possible in spring and summer prior to the reveal. Under promise and over deliver. And then just had them smile in mid july and say "its ready"... no one would hate them for being early, other than the people who pulled the trigger on a c7 in april may june july prior to the reveal.

I guess the other angle is... GM does not care about c7 sales, instead, they are trying to steal Porsche ferrari and lambo customers... and they don't want those people running out and spending 200 grand this spring. But there are not that many buyers of those cars, i would be more concerned with the number of c7s i have on the lots.

Keep in mind, its legal in most states to back out of deposits, so people who have c7's on order, could leave the dealers stuck with the car and get a refund on deposit, and put it toward a c8 or something else.

Another angle is perhaps the fear of GM's stock holders selling their stock in GM out of uncertainty and delays etc, so GM wanted to combat that from happening.

I think its obvious they still have bugs or else they would have revealed it already. So, now they have put themselves in a bind, where if they don't have things sorted before 7 18 19, then they are in an even worse position.... where they over promised and under delivered.

With all the c7's on lots, i don't see the logic in doing what they did, but I'm not complaining, like i said, I have no skin in the game, i just want to see the c8 I feel bad for the chevy stores with lots full of c7's, I cant imagine they are very happy with GM right now.

z06inVB

GM sold every C7 they built. Now the dealers on the other hand might have a problem but I doubt it. Soon you will see some great rebates and other discounts. Would not be surprised if by June they are close to 25% off MSRP to clear them out.

Mikec7z

right, but that rebate money is out of GM's pocket. And there is also something called "final payout" and that is when GM has to give the dealer all the rebate money in one lump sum, if the dealer is still holding the cars a year or 2 from now, depending on which model year they are.

17 final payout is already done, 18's is about to happen. 19 will be a year or more away.

GM still has an obligation to its dealers to assist them selling cars, and not hurt their sales.

I feel like the NY reveal was more out of fear and embarrassment of delays thus far, instead of logical business strategy.

I think stock price and stock holders had to be part of their decision.

marknagy13

Easy. Building hype on a new c8 is much more valuable to GM than trying to offload c7s. On top of that, they are already bought by the dealers. The cars on the lot are the dealers problems, not GMs.

Mikec7z

you guys keep saying that, but that is not true. The rebate money comes out of GM's pocket. So lets say there are 5000 c7 on dealers lots, and lets say they have to give them each an extra 5 grand in rebates to get them to move, that $25,000,000 from the factory. Yes, that is 25 million dollars.

So yes, it is GM's problem

Zora_Vette

But it isn't GM's problem. Those cars are all sold in GM's eyes. GM does not need to do rebates. The dealers can take the hit. When dealers order cars like that, it's like an investment into the stock market. They could either make a lot of money on the car, or have to discount it and lose money.

Mikec7z

final payout is in contract, it will have to be the max incentive GM gave on the car during its run. So if GM had 8000 in rebates on a car, final payout will be 8 grand cash to the dealers.

If dealers are sitting on 4000 cars a year from now, thats 32 million dollars paid out of GM's pocket on final payout.. and GM is already about to have to pay final payout on the left over 18's, and has already paid it on the 17's.

You guys aren't absorbing how it really works. You can say GM does not need to pay the dealers... that would result in the biggest class action you've ever seen, from the dealers vs GM. There are understandings in the car business. Final payout is one of them.

BEAR-AvHistory

Might or might not be a major hit. Depends what GM's profit margin is on the cars how bad the bottom line will be hurt. I think most of the C7's will sell off especially the base car with some dealers already into the high $40's. This opens the car up to a large group that could not pay upper $50's for a car. My local dealer has a lot (no pun intended) of Base 1LT's on the lot.

I don't believe the NYC show they just did was a random "watch this|". Gotta believe there is a rational plan for winding down the C7 inventory or the board will fire Mary.

roadbike56

Mikec7z, I understand your point, but GM did not have any better options. Saying nothing was not an option. I could search my posts, but it would take a while. I had posted this before that GM had to say something at the bash the end of this month. Silence was not an option because social media had already turned against the C8 posting negative statements. The pic of the C8 on a tow truck, the stalling in a gas station, rumors of delays, the twisted frame rumor, the electrical issue rumor, the crash at VIR, then some design vs engineering issue that's not fully developed lately, GM needed to make a statement to get positive news flowing. While it's a short time period, it appears to have been effective. I hadn't thought of the NYC location for the announcement, but it was brilliant. They made news right in the heart of Porsche/Lambo country. Right where they want to grab new buyers for their super car, Corvette. They can still make some statements at the bash to a group of news hungry fans. My compliments to Mary Barra, well played.
As for the C7, it's history. GM made their money on it and it served it's purpose that we now know was a model bridging time between the C6 and the C8. Whatever less profit they make is small potatoes and a cost of doing business. I'm positive they calculated their best options profit wise and are taking that path. But, you are correct that they are not making as much money on these C7s as they used to, but no matter what they did, that lower profit is in the cards, it can't be avoided.

Mikec7z

i hear you guys, but i think the better way was to create hype by having Tadge say something like this:

"We would like to announce there will be a c8 corvette. This car is going to be by far the most advanced GM vehicle ever made. The mechanical nature of the vehicle is functioning flawlessly. We are still doing further testing on its electronics. While I can't get into details at this time for obvious reasons, just know that this car will be worth the wait. These electronics will be used across the GM lineup. We could have waited to release these new electronics in the second or third year of the c8, but we wanted to do it right for the first year buyers, and do it right the first time. It is not the c8 that is the issue, it is these electronic systems, but we know what needs to be solved and are getting very close.

In the meantime, it appears the c7 is still ahead of our competitors in value. We are releasing a c7 limited edition (just stickers, whatever) and we want to also make it known now ahead of time, that the LAST c7 will be produced before the end of this calendar year, and that c7 will be auctioned for wounded warrior (or whatever charity it is). Rest assured, we are eager to bring these cars to showrooms, as soon as it is ready we will be revealing the c8"

Then you play it by ear.. if people order c7's through august, you produce them through august. You fulfill the demand, and then you call it quits. This includes zr1 and zo6 etc... and a lot of people who want to have the most collectable FE vettes ever, would have traded up... even zr1 owners, would have swapped.

And then put the sticker on the c8 camo cars 2 weeks before 7/18/19... or later if the bugs arent fixed as hoped.

A lot of people would have bought c7's between now and the beginning of July... both dealer stock and factory order.

Here is an article, pay close attention to the 7,500 dollar figure, this is "final payout" on a ram truck. on a z06, its well over 8 grand.
https://www.autonews.com/sales/behin...ut-dealers-buy

I just see total mismanagement by GM's executives on this whole deal. I think they acted out of fear instead of confidence in NY.

Ultimately 25 million or 32 million, that is money that we the consumer pay later on future car prices and parts prices, or else GM files BK again. Its just how businesses work. We are the ones who are hurt, or GM files BK as they run in the red, only 2 real options.

vndkshn

I think releasing the car will get people off the fence one way or the other. Alot of people are in a holding pattern to see what the new car will look like to make a decision. Now having some firmer dates and maybe a better idea of what it will look like, might move some cars.

Mikec7z

Had the release been this week, I agree with that. But the reveal is not for over 3 months... so i agree with your statement, and im saying, GM just put everyone who was going to buy a c7 this spring/summer, on the fence for 3 months since now we the consumer KNOW a reveal is coming.

GM shot themselves in the foot on this episode. im a perfect example, had I heard tadge say cars may be a year away, i would have pulled the trigger on a c7. Instead, im going to wait 3 months and see what it is im foregoing if i do get another c7.

I know im not the only one who reasons this way, i would say the majority of c7 buyers this spring/summer will do the same.

Red67John

I understand your theory, but all things considered, I think this is actually a pretty clever marketing campaign. Yes, the C8 is probably being revealed later than GM and a lot of Corvette enthusiasts would like, but it is still not late for a 2020 model reveal.

For decades reveals took place in early fall, usually September. The assembly plants completed the new model changeover, usually in early August, depending upon how involved the changeover was. Brand new models were kept under wraps until the big reveal day and people would literally flock to the showrooms.

Today we live in a social media and internet marketing world and this C8 teaser campaign is typical of how things are done today. It will be an online buildup to whatever the actual reveal turns out to be. It’s obviously working os far because we’re fixated on it and the magazines and blogs are all over it. This may have been the marketing campaign concept all along.

July 18 still gives Chevrolet plenty of time to changeover the plant and ramp up production of C8. We do not know if there are any glitches or details for the engineers and no information yet on when C8 production will begin. An announcement on C7 order cutoff should follow soon because there will need to be at least a brief model change shut down to move out the remaining C7 materials, tools, instruments, etc., and then set up for full speed C8 production.

As far as the C7, dealers are sitting on a lot of them because sales dropped of months ago. Maybe due to winter, maybe due to anticipation of the C8, maybe because the C7 market had peaked. Maybe all of the above. Dealers will deepen the discounts and at some point GM may toss dealers some cash incentives to assist in disposing of the inventory. The real financial burden will be on the dealers who overordered for inventory, and financed a bunch of C7s to secure their allocation of 2020 models. Their floorplan financing will cost them not GM.

Nobody knows when the first 2020 C8s will arrive at dealers but it looks like it will be late fall or early winter.

JerriVette

I sometimes wonder if you are over thinking this.

some people actually get off on buying the final model year of corvettes....they save a bundle...

some were waiting to see the c8 to decide if they want to buy a c7 with a heavy discount ....so tadge and mary showed the c8 off in a slight disguise..,enough for many to decide to buy the c7 they ve always dreamed of with a nice discount...

i want the c8 z51 dct fe4 and realize it will cost me around 70 grand plus whatever other options i want to tack on...

seeing 650 hp m7 c7z06s on autotempest brand new for 68 grand the other day was and is tempting as hell.....and i want to get a c8...

those 9000 c7 s wont be around too long if the discount goes to 25 percent...

i dont even know if I can hold off...

i wouldnt worry so much about chevy ...lol

worry more about the corvette owners like me who are trying not to buy a c7 z06 with 650 hp and a manual transmission...just to pay the same or more for a rear mid engine 500 hp c8 z51 fe4 with a dct ...

Jinx

GM didn't shoot themselves in the foot. They turned negative fringe rumblings into a positive news bite.

A temporary sales dip is expected during a generation transition. But then sales volume and transaction prices go up.

GM is not so worried about the fraction of the market that (1) wasn't already aware of the C8, (2) was definitely about to buy a C7, (3) is now undecided because they want to know about and maybe wait for the C8, and (4) won't end up buying either a C7 or a C8.
GM is more interested in that part of the market for premium sports cars who might be getting that spring itch, and whose last awareness of Corvette was of the knife-edge ZR1 and otherwise the same years-old car.
But mostly GM is thinking about all the marketing steps their team has to execute leading up to volume sales and deliveries.

And yeah, instead of a news-bite-friendly almost-context-free extremely visual drive of a camouflaged car through NYC, with the single takeaway of the date of the unveiling, they should have issued a press release acknowledging a bunch of rumors of which most of the target market was completely unaware.

Mikec7z

when 25-32 million is on the line... good companies think things through well usually

But i agree with you on many points.

As for the other guys saying it does not cost GM any money ... i think i already covered why it does actually

Warp Factor

Yup. Some people loved the looks of the front-engine cars, and didn't like the looks of the New York C8 car. They can now go ahead and buy one of the C7s, helping reduce inventory.

JDSKY

I don't think it hurts C7 sales at all. If you want a car to drive this year then a discounted C7 is still a great option. If you were already content sitting on the fence and willing to wait, well you were not a buyer before this latest announcement and if you are now willing to wait even longer you are still not a buyer. No actual sale was ever lost. I also think for every buyer that is now digging in and willing to wait a year there are others that are going to head out and get the car they may have been wanting all along and the deals will just make this something too good to pass up. I have kicked around the idea of picking up a GS or Z06 and based on my search I'm not sure where all of these overstock cars are hiding out. I know exactly what I want and thus am not willing to settle for a car that does not check all the boxes. For me that means ordering a car. Well we now know the window of opportunity for that is closing fast. I need to order one or let that opportunity pass me by forever.

I might be in the minority of those that believe the new car is going to be spectacular. What I was not personally willing to do last year, or this year, was wait around for it. I am going to continue to have a blast in my C7 while the new car is finally unveiled, actual orders begin to be taken and deliveries finally hit the road. I will be just fine waiting to see if the car really IS the right car for me once it becomes a reality and proves itself out over some miles of everyday use.

Mikec7z

if GM said the car will be ready in a year or so, maybe sooner, i think that word track would have sold a lot more c7s, and put the spotlight on c7 limited editions etc.

GM could have still done the reveal in july, and been the hero. Keep in mind too, GM could start getting the factory ready for the c8 in july, and if c7's were still selling, the c8 reveal could of been held off to august september ect. Production date is still the same, lets say december 15th for instance. They just back the reveal up

The entire reason car companies dont show people what they are working on before it is released is to keep excitement as high as possible on what currently exists which still needs to be sold.

jcp911s

Folks,

GM INVENTED the model year, and planned obsolescence back in the 1920"s... they've actually done this before. So, value-minded buyers can get a $8K discount on a new C7 today, or wait 12-16 months to pay full sticker on a new C8... somebody will bite.

If GM is looking at eating $25-30M on rebates, believe me, they know this, and have the money in a reserve, it's just part of the business plan.