Supplier Contracts For The Chevrolet Bolt May Shape GM’s Future

1 day ago by Steven Loveday 72

2017 Chevrolet Bolt

Chevrolet Bolt

The Chevrolet Bolt reeled in the awards this year, and thus brought much positive attention to General Motors; however GM’s handy work securing new suppliers for the venture may prove to be the more substantial benefit in shaping the company’s future.

General Motors’ purchasing chief, Steve Kiefer, has made it clear that his goal is to expand the automaker’s list of suppliers, as well as improve relationships with current suppliers and partnerships. One way that Kiefer was able to solidify the new contracts was to allow the suppliers to keep rights to their intellectual property. He told Automotive News that the supply contracts for the Chevrolet Bolt will likely impact GM’s future endeavors. Kiefer shared (via Autonews):

Chevrolet Bolt EV’s 60 kWh Battery (Cells by LG Chem)

“We took a revolutionary approach to the supply base. The technology is coming from nontraditional suppliers, and we had to change the way we did business with them.”

Kiefer even went so far as to say that the company has already taken steps to secure long-term contracts for upcoming full-size SUVs and trucks. We’re talking about brand-new contracts that are set in place for a full two product cycles. This secures suppliers for 10-12 years. Suppliers tend to prefer such deals because it gives them time to capitalize on initial tooling and production investments.

The suppliers Kiefer is referring to are LG Chem and LG Electronics, out of South Korea. The companies were responsible for much of the Bolt’s production, including the battery pack, electric motors, and powertrain components. Even the Bolt’s infotainment system came as part of the new contracts.

GM’s decision to manufacture self-driving Chevrolet Bolts in partnership with Cruise Automation is another step that could have a positive impact on the future. Cruise supplies the parts and software that power the Bolt’s autonomous system. Additionally, GM is diving headfirst into future mobility with its own startup, Maven, as well as a substantial investment in ride-sharing company, Lyft.

Source: Automotive News

Tags: , , , , , , , , ,

72 responses to "Supplier Contracts For The Chevrolet Bolt May Shape GM’s Future"

  1. Bill Howland says:

    All modern cars are basically farmed out to suppliers. Gone are the days when a GM car had a Fischer Body, or a Harrison Radiator, or even Delco-Remy electricals/electronics (now more than likely – the alternator is made by prestolite no matter if its a GM or FORD).

    Even Tesla uses Diamler Steering and switchgear.

    These GM spokesman who talk about Lunar Landings and ‘revolutionary approaches’ would probably do more good if they were sent there to personally inspect things.

    Nothing out of the ordinary to see here. If a typical car has 100-300 suppliers – he certainly needs to explain precisely how the BOLT ev is any different that the VOLT in any meaningful way (other than the fact that one supplier got a bit more percentage wise of the work).

    1. Rob Stark says:

      Tesla uses the same supplier (Thyssen-Krupp) as Daimler for steering and switchgear for their Gen II vehicles.

      Tesla has control of its most critical IP including its battery chemistry.

      1. bro1999 says:

        “Tesla has control of its most critical IP including its battery chemistry.”

        And GM does not?

        1. L"amata says:

          IF these sneaks running GM want to show sincere commitment to EV’s , They should at least have had multiple Chargers in place in “All” GM STEALERSHIPS Already & there’s their charging infrastructure OVERNITE ! even if it’s Pay per Charge..BUT THEY DO NOT! That speaks volumes…This confirms that bolt is merely a Compliance car, nothing more! and that they have no intention of taking it further,In the Mean time they’re Hoping that “EV”s would just go away!..I Say THEY WON’T ! ..

          1. John Ray says:

            Looks like L’amata is off his meds again. Lots of ALL CAPS and exclamation points!!! Don’t ever change, brah!

            1. SparkEV says:

              He’s an “evnut”. Whatever happened to that guy anyway?

              1. Pushmi-Pullyu says:

                I’m not sure, but I think EVnut just keeps changing his screen name, and that “L’amata” is one of the names he’s using.

                Maybe he selects a screen name for the day (or the hour) based on how much he’s on or off his meds. 😉

          2. ClarksonCote says:

            Yeah, and if they were serious about selling those gas guzzlers, they’d be investing in gas pumps at all their dealerships too…

          3. Bill Howland says:

            Well, I was at one of Rochester Ny’s larger dealerships yesterday and they had 4 wallboxes charging up the 2 ev’s they had.

            Unfortunaltely, VW doesn’t sell any new EV’s and the 2016’s don’t go far enough.

            This dealership would only be useful to ME PERSONALLY if I was desparately seeking some juice, but seeing as it is in a large city its usefulness is even more questionable.

            I don’t need charging facilities at dealerships. I need the when I am in the middle of nowhere between two population centers.

            At least Tesla to a limited extent does this much.

        2. Taser54 says:

          We know the answer to that. GM owns its battery chemistry. That’s published.

        3. Taser54 says:

          We know the answer to that. GM owns it’s battery chemistry. That’s published.

          1. Ianstuart says:

            Funny the article says the reverse. LG owns the rights to the battery motor, transmission and even infotainment system! Doesn’t leave much for GM except that really ugly body.

            1. Vexar says:

              Uh, the chassis was designed by GM Korea, so how much of that is “Designed in Detroit” I do not know. Sure doesn’t look like a Camaro!

              1. SparkEV says:

                Many (or maybe most) Hyundai are designed outside of Korea. Even the Excel from mid 1980’s was designed in Europe (with Japanese engine). That doesn’t mean Hyundai isn’t a Korean company.

            2. unlucky says:

              The article doesn’t say that. Suppliers may contribute technology but they don’t end up with the rights to what they produce.

              If you couldn’t change suppliers then you couldn’t get a good negotiated deal from your suppliers.

              You can be sure that GM owns the rights to produce the car with any supplier they want. LG doesn’t own them.

              It’s one of the basic principles of contract manufacturing.

              1. Pushmi-Pullyu says:

                Nonsense.

                There is no way that LG Chem gave or sold GM the IP for its proprietary battery chemistry; the chemistry which is currently giving LG a competitive edge over at least most if not all other battery makers in the world.

                GM contracted with LG Chem/LG Electronics to make the entire powertrain for the vehicle; not only the battery pack, but also the electric motor and power electronics.

                Sure, GM can go to another supplier for a powertrain, and likely GM does own the IP for various things in that powertrain, perhaps including the electric motor, inverter, etc.

                But the actual battery chemistry? No way LG Chem would ever sell the rights to that to another company. At most they would license the right to use their proprietary battery chemistry, and even there, why would LG agree to license that to GM? GM isn’t a battery cell manufacturer, and couldn’t use that IP themselves.

                1. WadeTyhon says:

                  http://www.detroitnews.com/story/business/autos/general-motors/2017/05/11/profitable-evs/101531172/

                  “The Bolt EV’s 60 kilowatt-hour battery pack contains 288 lithium-ion cells. South Korean company LG Chem supplies the battery cells and pack for the Bolt EV.

                  GM’s ownership of its own battery chemistry and integrating the battery pack with its own electric motors also is helping drive EV cost downward, Reuss said. The company says economies of scale – as it deploys more EVs here and in China – will aid with cost.”

                  Also, in early January of 2015, before the reveal of the Bolt concept, Mark Reuss stated: “The Volt and the CTSV will be shown in Detroit and there will be a couple of other surprises that will be *raises eyebrows* really exciting
                  too but on the Volt – if you look at how we’ve really dedicated ourselves to that technology – both how we’ve set ourselves up to own the battery chemistry on the Volt and use an incredible supplier with LG on the cells themselves”

                  http://www.autoline.tv/show/1901

                  Quote is found at the ~7:00 minute mark. Whether they could just take that battery chemistry to a different supplier or not I don’t know.

                2. unlucky says:

                  Pushy, really why do you have to do this?

                  It’s already documented GM owns the chemistry.

                  Sure there are logistical difficulties to changing suppliers. That’s why suppliers can charge any kind of markup (profit) on their wares.

                  But for a supplier to own the technology would make them not a supplier. GM knows this. They’re not going to make a deal which makes them beholden to a single supplier.

                  So either GM owns the chemistry or LG agreed to give GM an irrevocable free license to produce batteries with the same chemistry using another supplier. It’s basic contract manufacturing. If you cannot second source then there is no financial advantage to outsourcing in the first place.

                  GM would have secured such a deal before going in. LG Chem would make the deal because without it they get no deal, no money.

                  Yes, GM would have a significant amount of trouble changing suppliers. But they’re not going to put themselves in a place where they don’t own what they make.

                  And don’t worry about LG Chem. It’s an advancing market. Even GM has the exclusive patent on that chemistry it won’t matter in a few years when there is a better chemistry. LG Chem isn’t really locked out of anything.

                  So why do you find it so difficult to give GM credit for developing a battery chemistry? They’ve been working on this for years now.

                  Panasonic makes Tesla’s cells. Do you think Tesla owns (or has perpetual free license to) the chemistry they use? I do.

            3. Bill Howland says:

              I’ll grant you that – that much *IS* a bit novel. GM used to insist on all proprietary information used in the manufacture of their products, but now for some reason is not so insistent on it.

        4. mx says:

          Least earnings call, Tesla now has access to the top 18 auto suppliers, for the Model 3.

        5. scottf200 says:

          Quote: One way that Kiefer was able to solidify the new contracts was to allow the suppliers [ie. LG Electronics and LG Chem] to keep rights to their intellectual property.

          So GM does not have the right to the IP then.

          1. Neromanceres says:

            There is lots of IP involved in designing and manufacturing a battery. GM owns the chemistry and design but LG likely owns the IP to manufacture it.

            1. bbock says:

              Doesn’t Tesla partner with Panasonic for their battery chemistry? Tesla and Panasonic also partner on solar. I’m amused about the people who think Tesla does it all by themselves.

        6. Pushmi-Pullyu says:

          “And GM does not?”

          Hmmm, well as I understand it:

          GM doesn’t control the battery chemistry in the cells which LG Chem supplies them. But then, Tesla isn’t in control of the exact chemistry in the cells Panasonic supplies them, either.

          I think it would be more correct to say that Panasonic optimizes the cells it makes for Tesla to fit Tesla’s specific needs, just as LG Chem optimizes the cells it makes for GM to fit GM’s specific needs.

          Tesla’s partnership with Panasonic at the Gigafactory certainly does give Tesla more control over what kind of batteries are produced, and Tesla did select the form factor of the Gigafactory’s 2170 cells. If my understanding is correct, Tesla also specifies details of the internal arrangement and the “can” — the battery casing. But as I understand it, Tesla’s battery patents are related to the internal arrangement and the size and shape of things, rather than the battery chemistry.

          Tesla has a sophisticated battery analysis lab, so they may well have an informed opinion about what chemistry their cells ought to have. But in practice, my understanding is that Tesla gives Panasonic specifications for what characteristics they want the cells to have, and it’s up to Panasonic to select the precise chemistry to best match what Tesla wants… pretty much the same arrangement between GM and LG Chem, altho Tesla may well have a wider range of choices there, and due to their sophisticated analysis capability, Tesla may well give more input into the exact chemistry. I would guess that LG Chem’s optimization of the cell chemistry for low cost limits choices somewhat.

          Ongoing tweaking of the cell chemistry for improved energy density and lowered cost in Panasonic’s cells will be done by Panasonic, not by Tesla.

          All this is what I’ve picked up as an interested industry watcher. I don’t claim to be an “expert”, and it’s possible I may be wrong about some of the details.

          1. unlucky says:

            There’s no way Tesla would give Panasonic any aid in developing new chemistries without either full ownership of the results or 100% free license to use all the results with any manufacturer they want.

            If they didn’t get that then Panasonic can raise their price at any time to any level and Tesla would be force to shut down at least until they reengineer.

            These businesspeople know their way around the block. At GM and Tesla. Trust me.

    2. ClarksonCote says:

      Hey Bill, hope you’re doing well.

      Slightly off topic, but what do you think of NY state adding DCFC at the Mohawk Valley Welcome Center on the Thruway, and only putting CHADEMO ports there?

      I’m dumbfounded at their ignorance.

      1. CCIE says:

        Wow, that’s crazy. Did you try contacting someone with the state to explain the situation? I’d hate to see them role DCFC stations like that throughout the state.

        Does anyone even use Chademo besides Nissan? Are they still going to use it on the new Leaf?

        1. As far as I know, only Nissan and Mitsubishi use CHAdeMO.

          1. speculawyer says:

            And Mitsubishi doesn’t sell EVs any more.

          2. unlucky says:

            The Kia Soul EV uses CHAdeMO.

            It isn’t sold anywhere near New York though.

        2. ClarksonCote says:

          I did send them an email about how ridiculous it is, but haven’t heard back. Maybe they’re “looking into it further” or wondering how they let that little oversight happen.

      2. Bill Howland says:

        That’s at the other end of the state for me and its doubtful I could even EASILY get there.

        NYState’s rollouts of wallboxes and L3 chargers seems to mimic VW’s effort – they’re doing just enough to be in the game.

        I’d rather have the money back, which I just missed out on the $2000 for the BOLT, but then I got an addl $2000 off from my credit card.

        I also think the state’s 50% contribution (via tax credit) of charging facilities for businesses provided they offer free charging for 36 months also helps ensure the few wallboxes we do have.

    3. VFanRJ says:

      The new model includes more design work done by 3rd parties.

  2. Rob Stark says:

    Good grief, GM is locked into their heaviest polluting vehicles for 12 years.

    And much of the intellectual property for the Bolt remains with LG Electronics and LG Chem.

    They are out of the European, Indian, Indonesian, and South African markets.

    GM is more %$#@ than I thought.

    1. theflew says:

      GM owns the Bolt’s motor and inverter design and battery chemistry. What’s more important than those things with EV’s?

      1. bro1999 says:

        The center display screen glass?

        1. John Ray says:

          The tires! GM doesn’t own the tire molds or make its own tires!!! THEY AREN’T SERIOUS ABOUT EVS!!!

          1. Spider-Dan says:

            If you don’t have your own power plants, You Aren’t Serious About EVs.

            1. CCIE says:

              Forget power plants! If they don’t have their own star to generate power for their EVs, then they might as well just go out of business now. They’ve been relying on the Sun, instead of building their own star. What’re they thinking?!

      2. Pushmi-Pullyu says:

        “GM owns the Bolt’s… battery chemistry.”

        Well, I see that or similar comments made in various comment threads about the Bolt EV, on other websites.

        What I do not see is any quote or citation from any GM or LG Chem rep saying or implying such a thing.

        Personally, I’m quite skeptical of the claim, and will remain so unless I see some real evidence for that, or an actual direct quote from a GM or LG Chem rep indicating that’s the case.

    2. bro1999 says:

      You obviously have no clue what you are talking about.

      HUGE difference between engineering a device and then contracting a supplier to build that device to your specs and asking a supplier “Hey, I need this device that does X, Y, and Z, can you come up with something?”

      Anti-GM FUD’sters up bright and early this morning I see.

      1. georgeS says:

        Bro,
        The key take away here is not really whether or not GM management is committed to expanding it’s EV line up.

        The important thing is that we now have another electronics and battery supplier that is competitive with Tesla/Panasonic.

        Hopefully soon we get the announcement from Nissan that LG does indeed supply the 60 kwh battery for the gen 2 Leaf and that it has a full up thermal management system like the BoltEV.

        Too bad LG is so physically close to the crazy fat kid (Korea).

        1. theflew says:

          One would argue LG is a better supplier because they can do display panels, batteries, electric motors, etc…

        2. Pushmi-Pullyu says:

          “…we now have another electronics and battery supplier that is competitive with Tesla/Panasonic.”

          Let’s see… an LG Electronics rep said they were contracted to make slightly more than 30,000 EV powertrains for the Bolt EV in the first year of production, with no talk of ramping up; Tesla is committed to ramping up to produce 500,000 EVs per year within 2-3 years.

          I guess we have a different definition of “competitive”.

    3. VFanRJ says:

      It’s all about following the money. What are people willing to shell out the most money for.

  3. ClarksonCote says:

    Perhaps I’m reading this wrong, but the article refers to brand new contracts for SUVs and trucks, and then says that the suppliers being referred to are LG Chem and LG Electronics.

    So is that implying that GM’s SUVs and trucks are set to be electrified over the next 10 years?

    1. bro1999 says:

      Source article separates the LG Chem/Electronics deals from these new SUV contracts. So no, not a confirmation LG is working on SUV-related contracts unfortunately.

      1. ClarksonCote says:

        Thanks. Wishful thinking I guess, heh

  4. Bacardi says:

    Good GM, perhaps marketing your new supply chain approach will increase Bolt EV sales?

    But then we have this…

    “Cruise Automation CEO On Joining GM: ‘It Hasn’t Been Smooth Sailing”

    “It took us probably six months to a year to really figure out how to work well together and to achieve what we have now, which is mutual respect.”

    “and figured out when it comes to software that’s really complex and needs lots of cycles”

    http://gmauthority.com/blog/2017/07/cruise-automation-ceo-on-joining-gm-it-hasnt-been-smooth-sailing/

    1. bro1999 says:

      When you have Silicon Valley and Detroit meshed together, rarely will things go smoothly from the get-go. Good to hear they have figured things out though.

  5. MDSTJ says:

    Drove a bolt yesterday and was very impressed. At $38,000 it’s seem to be a very nice car.

    1. DJ says:

      Ya, but at ~$33k it could be an even nicer car 😀

      http://www.chevynorthridge.com/Rydell-Chevrolet-Newspaper-Specials?siteMapItemName=3289501381514904562

      This is what really just annoys me. All the Tesla nuts keep claiming that the Model 3 is cheaper than the Bolt. That you can get a Model 3 for $35k. Well isn’t it actually $36k with destination?

      Now here’s the Bolt that is $37.5k WITH destination already built in. They conveniently leave that cost on the Bolt but forget to add it to the Model 3. So yes from a MSRP standpoint it’s more expensive however it’s ridiculously easy to pay a lot less than MSRP. Even more if you don’t like black you don’t have to pay $1k to change the color, etc..

      The Bolt serves a specific market, just like the Model 3 does. The Bolt however is considerably cheaper and available now to a heck of a lot more people than the Model 3 is.

      I’m not saying the Bolt is a better car, or a worse car for that matter, just that it’s a cheaper and more available car.

      I’m sure some idiot Tesla fanboy will say I’m trolling but if showing reality through facts and basic math is trolling than I will gladly do that crap all day long.

      1. Bacardi says:

        You are accurate however you Cherry picked that location, what if you don’t live near there nor want to deal with shipping it? 95% of dealerships will go below MSRP but by several thousands may take a fair amount of time and effort…And strolling into anytown dealerhips and dealing with a front line salesman nearly guarantees disappointment…

        In terms of price, where the Bolt will really shine is leasing…Due to various incentives including GM points, Bolt will probably cost a third less than a base M3…

        1. Bill Howland says:

          If people want to say the BOLT is a lousy car, then so be it.

          The 2016 e-GOlf I looked at yesterday is the far nicer car – better seats, more storage space.

          But, the car can’t go anywhere because of its dinky battery.

          And the other thing I told the salesman that was dumb was the cord connector won’t be released unless the driver is present. That’s dumb.

          When the car is sitting charging, and the car FINISHES, the charging cord can’t be taken back to the wallbox for the next person to use.

          1. unlucky says:

            VW e-Golfs shipped for year with climate control systems that didn’t even remember what you set them to. They reset to 73F every time you turn the car off.

            What does nice mean?

            If nice means a better sculpted interior but the car works worse what good is nice to me?

          2. Mark.ca says:

            Bill, not true on the charger connector. On my 2016 eGolf i cand disconnected the L1 even if the car is locked and the key out of range.
            Unlucky is right about the climate memory…it’s strange and stupid…

            1. Asak says:

              If you can do that there must be something wrong with your charging lock or something specific to your charge plug is preventing the lock from engaging. On mine I can’t remove the plug without the key. Granted I’ve never tried bracing myself against the car and trying to rip it out with all my might–seems like a bad idea though.

              Anyway the charge plug thing is an annoyance. Also it’s annoying that the charge port has no light, so in the dark it can be difficult to plug in (unlike a gas station, a charger won’t always be in a well lit location. Resetting climate control is silly but doesn’t really bother me that much.

              Other than that and the limited range it’s a great car. Unless you’re planning to use public charging a lot, I’d consider overlooking the charge lock.

      2. Pushmi-Pullyu says:

        DJ said:

        “I’m sure some idiot Tesla fanboy will say I’m trolling but if showing reality through facts and basic math is trolling than I will gladly do that crap all day long.”

        You are a serial anti-Tesla troll. You don’t post anything at InsideEVs except Tesla bashing posts. Denying that doesn’t change the reality.

        I don’t know why anyone should care about this argument, getting down into the weeds of the charges that are tacked on in addition to the MSRP of a car, but Nix has pointed out — repeatedly — that Tesla’s “delivery charge” includes dealer prep, which Chevy dealers are going to add on as a separate charge, and Tesla doesn’t.

        The fact that you’re deliberately ignoring this difference of a few or several hundred dollars, after it has been pointed out repeatedly, pretty definitely shows you’re not interested in Truth or actual facts; you’re just here to bash Tesla.

        So don’t pee on our legs and try to tell us it’s raining.

        1. unlucky says:

          No, dealers don’t add dealer prep as a separate charge. Dealer prep is an item that the car manufacturer reimburses the dealer for.

          I say this as a person who actually knows about cars and a person who bought a Bolt!

          1. Nix says:

            Dealer prep, Dealer Doc fee, Dealer additional profit, whatever the dealer decides to call their additional Dealer fee doesn’t matter.

            The reality is that the vast majority of dealerships charge an extra dealer fee that Tesla doesn’t charge.

            And that’s before we get into pin stripes, and vin etching, paint sealant, undercoating, and a myriad of extra dealer add-ons that are essentially junk fees.

            And don’t get me started about the markups at the back end. Like when they charge you a higher interest rate, and collect the difference. Or when they sell you service agreements and pocket a huge profit margin. Or sell you payment insurance, and again pocket a big fee. They get you with the “deal”, and then nickle and dime you throughout the entire transaction.

            If you don’t know absolutely everything I’m talking about, then it is analogous to when you are playing cards and you don’t know who the mark is. If you don’t know who the mark is, it is you.

            1. Asak says:

              Even accounting for all those fees you can still get a Bolt for less than $35K, including everything besides sales tax.

              1. Nix says:

                Asak — It is certainly possible to do so, but ONLY on a purchase, not on a lease.

                If you get one for $35K and lease it, GM Finance (subsidiary of GM) takes the vast majority of YOUR $7500 federal tax incentive.

                So you may save $3K on the price, only to have GM take $4K or more of your Federal Tax credit.

                They get $34K or $35K from you, then pocket $4K or more of the federal tax incentive. They effectively get paid thousands over MSRP between your money, and your federal tax incentive ending up in their pocket.

                And the vast majority of EV customers have preferred leasing over buying. So the vast majority won’t actually pay below MSRP even with the $3,250 purchase incentive that GM is currently running on the Bolt.

            2. bbock says:

              We bought a Bolt. We payed far below MSRP OUT THE DOOR. There was a doc fee. But California limits it to the actual cost. The destination fee is in the MSRP. There was no dealer prep or other bullshit fees because we went in knowing the price and told them we wouldn’t pay more than the amount OUT THE DOOR. Can you negotiate a better price with Tesla? I ask that because I don’t know. Bottom line is that the Bolt will actually be cheaper than the Tesla. But the Tesla has a lot more features you can add on.

              1. Nix says:

                Did you lease or purchase? It certainly is possible to get below MSRP on a purchase, and it certainly is possible to get the dealer to move their dealer fee to behind the line (it is still there, it was just shifted and hidden in the bottom line price).

                The problem is the vast majority of EV buyers prefer to lease their EV’s. If you leased, how much of the $7,500 Federal tax credit did they apply to the lease? Everybody so far has reported that they are only offered a fraction of the $7500 as part of the lease terms. So they really can’t buy for under MSRP once GM pockets the lion’s share of the $7500 fed incentive. (IBID — a number of links by a number of posters have been provided in the past documenting this).

                ____________________________________

                Tesla has 7 ways they have discounted cars:

                1) Get a discount on your purchase price by being referred by a current owner.

                2) Get free perks such as free lifetime supercharging by being referred by a current owner.

                3) Get freebies or exclusive features for being an early reservation holder.

                4) Once you own a Tesla, you can reduce your effective purchase price by referring new customers. This can come as cash back, or free product. This has led to some people getting entirely free Teslas!! I don’t know of any other EV who has gotten that much discount. 100% discount is pretty much unbeatable.

                5) Buy an inventory car at a discount instead of ordering a custom car. Discounts are based on months since production and miles driven. You can get a discounted inventory car with less than 50 miles on it, effectively making it a brand new car.

                6) Buy a Service loaner or demo car with a few thousand miles. While they are legally considered “new” for the purpose of titling and state/federal incentives, most people would think of these as gently used.

                7) Finally, their old guaranteed buyback program also effectively discounted the price for buyers who took advantage of the buyback, by reducing their out-of-pocket costs over 3 years of ownership.

                There is no reason to believe that Tesla won’t discount the Model 3 in similar or in new ways as their initial sales rush is satisfied, the same way the initial sales rush for the Bolt ended and they began discounting.

      3. Nix says:

        DJ — Why is it that every time you guys compare the price to the Model 3 you all conveniently leave out the Bolt upcharge for DC direct charging? As if the Bolt were at all equivalent to the Model 3 without it?

        Why is it that you guys always leave out that those deals are for purchase, and not for leases? Because if you lease GM just takes back all those discounts by only crediting a fraction of the $7500 fed incentive back into the lease deal?

        Why is it that every time you guys post these deals you never mention that “dealer fees extra.” (typically $480 on Rydell transactions)

        You guys should put a big star every time you post the same stuff, that says:

        *** EXCLUDES LEASES, EXCLUDES DC FAST CHARGING, $750 EXTRA, DEALER FEES EXTRA ***

      4. Someone out there says:

        Destination fee is included in the $37500 but on the other hand dc fast charge is not, which is silly IMO.

        The destination fee is just silly in itself. I know it’s mandated by law but why not just set it at $1 and be done with it? If the fee mandatory for every purchase then it should be included in the price from start.

        1. Nix says:

          The Destination fee is charged by GM. It is not the same as the Dealer prep, Dealer Doc fee, Dealer additional profit, whatever the dealer decides to call their additional Dealer fee. Those are two different fees.

          Tesla does combine these into a single Destination and Doc fee of $1,000. It is all inclusive of the two separate Destination and Dealer fees that GM and the Dealership charge.

  6. Chris O says:

    GM has sort of marginalized itself in the Bolt production process outsourcing all the key components like that. It’s what FCA’s Marchionne refers to and fears as “disintermediation” but GM seems okay with it.

    Well maybe traditional carmakers like GM will remain useful for tech firms like LG as a coach builders.

    1. Pushmi-Pullyu says:

      It does seem rather strange for GM to outsource the entire EV powertrain to LG Chem and LG Electronics.

      What’s the message here? Looks to me like it’s “Well, we do want to sell enough EVs so that we don’t have to buy carbon credits, but we’re not interested in investing in our own R&D to build the core technology of the EV powertrain.”

      I understand that GM found sales of the Volt to be disappointing, and so I can understand they’d be doubly cautious about spending R&D money on another EV. But surely GM, just like every other large auto maker, must see the handwriting on the wall, and must realize that the future of the automobile is EVs.

      GM outsourcing its EV powertrain would be like outsourcing the gas motors for its gasmobiles. If GM is going to outsource its core technology around which the entire car is built — either an EV battery pack or a gasmobile’s gas engine — then how in the world can they ever compete with other auto makers? Are they gonna do nothing but tart up the interior and copy the body design from other auto makers?

      1. unlucky says:

        Nissan just sold AESC. Does that mean Nissan has no interest in the tech behind EVs? No.

        Honda, Nissan and Toyota showed us how to use outsourcing to make your product better and cheaper in the 80s. It didn’t mean because they didn’t want to keep making cars. 30 years later there are plenty of people who understand the logic and value of outsourcing.

      2. Someone out there says:

        It’s no more strange than Apple barely manufacturing anything themselves. The iPhone is made by other companies to Apple’s specifications.

        1. Chris O says:

          Good point, GM could simply outsource the complete production of its cars to China. All it would need in Detroit would be some offices and a design centre.

          Maybe not. I think it will settle for the role of glorified coach builder.

Leave a Reply