Manufacturer Cost Comparison Between Tesla Model 3 And Chevy Bolt

MAY 30 2018 BY EVANNEX 91

ELECTRIC VEHICLE COSTS: GM VERSUS TESLA

There are several reasons that the legacy automakers are lukewarm on electric vehicles – one big one is that they don’t make any profit on them, thanks to high battery costs and low production volumes. But a major tipping point for EVs is approaching. Investor’s Business Daily argues that EVs could soon be cost-competitive with legacy vehicles, and profitable. The industry has plans to invest over $100 billion between now and 2030 to build production capacity, which will lead to economies of scale.

*This article comes to us courtesy of EVANNEX (which also makes aftermarket Tesla accessories). Authored by Charles Morris. The opinions expressed in these articles are not necessarily our own at InsideEVs.

Above: Looking at electric vehicle costs between Tesla and GM (Image: Paysa)

“Battery costs are coming down, and OEMs and suppliers are developing lower-cost motors and electronics,” said Navigant Research Analyst Sam Abuelsamid. “As battery capacity increases, the vehicles become more appealing, which will all combine to improve demand and profitability.”

GM has said that it expects its electric cars to become profitable by 2021, but there’s a long way to go. UBS recently estimated that GM was losing $7,400 on every Bolt sold. “It’s very, very difficult to make a profit, but not impossible,” Kelley Blue Book Analyst Rebecca Lindland told IBD, adding that Toyota reportedly needed more than 10 years to turn a profit on the hybrid Prius. She estimates that it will take GM at least that long to bring the plug-in hybrid Volt into the black. However, the Bolt EV could reach profitability faster because of the lessons learned from the Volt.

As usual, Tesla is the exception to the rule – it got into the electric game much earlier, and started out at the luxury end of the market, where there’s more room for profit. Tesla has said that it earns a margin of approximately 25% on Model S. According to IBD, the luxury sedan’s marginal cost is around $30,000 (excluding fixed up-front costs), leaving plenty of room for profit at its $70,000-and up sticker price.

The newer, lower-priced Model 3 is another matter. Most observers agree that Tesla’s current margin on the $35,000 base model is thousands of dollars in the red. Of course, that’s why Tesla is not yet delivering the base model – a disappointing but necessary strategy, as Elon Musk recently explained. To look at it another way, UBS estimates that Tesla needs to sell a Model 3 for at least $42,000 (including options) in order to break even.

Above: Tesla’s Model 3 (Image: Tesla)

The future profit picture looks a lot brighter for Tesla than it does for legacy automakers such as GM and Ford, thanks to the EV-maker’s first-mover advantage and superior battery technology.

UBS, which partnered with Munro & Associates to do a teardown of the Bolt, estimates that its battery pack costs $12,300, and that by 2025, that will drop to $7,800. Better cell chemistry, higher energy density and lower assembly costs will deliver savings. “The cost of making batteries is going to dictate whether you make a profit or not,” Lindland said.

Munro also recently tore down Model 3, and was highly impressed with Tesla’s battery, saying that Korean suppliers LG and Samsung have long been considered the best in the battery business, but that the Model 3 pack “blows them both away.”

Battery packs offer the most scope for reducing costs, but other parts of the EV powertrain also offer potential savings. According to UBS, the electric drive unit, including the motor, transmission and housing, costs about $1,200, a figure that could fall 10% by 2025 as new components with fewer moving parts reduce machining and labor costs. Power electronics, including the motor controller, inverter and DC/DC converter, represent another $1,200 in costs. UBS predicts that improvements in semiconductors could yield savings of 25% here.

Above: GM’s Chevy Bolt (Image: InsideEVs)

Innovations in design and production are likely to deliver further savings. As it expands its EV lineup, Ford expects to cuts the size of its final assembly area in half, reducing capital costs by 50% and labor hours by 30%. GM plans to streamline production costs by using the same EV platform across cars, crossovers and SUVs.

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Written by: Charles Morris; Source: Investor’s Business Daily

*Editor’s Note: EVANNEX, which also sells aftermarket gear for Teslas, has kindly allowed us to share some of its content with our readers, free of charge. Our thanks go out to EVANNEX. Check out the site here.

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91 Comments on "Manufacturer Cost Comparison Between Tesla Model 3 And Chevy Bolt"

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Tim

I’m surprised that “the electric drive unit, including the motor, transmission and housing, costs about $1,200”. I will claim ignorance on the cost of an ICE powertrain, but guestimate it to be at least twice this amount.

One thing not mentioned in the cost comparison is the cost advantage of a beautiful design (or a penalty for ugly design). It’s one of the key factors in buying a car, and can be between thousands of dollars to priceless.

F150 Brian

ICE drivetrains (Engine + transmission) used to be quite inexpensive (<$2K. A first gen 4.3l V6 GM truck engine retailed for $1700 so obviously cost a lot less to build) but emissions regs and push for fuel economy have driven costs way up. I would not be surprised if a modern high feature V6 and 8+speed electronic tranny are north of $10K.
The cost of design is the same for an ugly car and a beautiful one. The cost to build is definitely different.

reu

Try getting an AMG motor fixed on an old mercedes like a 10 yr old one the cost will make you cry.

Dave

For EV‘s, the battery cost is the huge expanse, typical production ICE cars cost 1/3 of their sales price to build on cost of goods basis… on an EV, just the battery is often nearly 1/3, so you can see the problem with cost. Of course what I am talking about is the base price, once you add a lot of options, that is where automakers really make the profit…

ModernMarvelFan

There is NO WAY that motor controller will cost less than $1200 to build. Not the mechanical stuff that includes the electric motor, gearbox and housing. The high powered IGBTs controller for the motors with 200kW or more will easily cost more than $1200 to build.

Patrick

The most expensive thing in electric motor and controll unit is the copper in the motor windings. The controllers cost basically only R&D. Depending on numbers of cars sold they can cost between 1k to probably less than $150 . It’s only a PCB, the industry knows how to manufacture those dirt cheap since 20 years.

Pushmi-Pullyu

The inverter for the motor is definitely going to cost more than the copper windings for the motor. I don’t know why you’d say “the controllers cost basically only R&D”. Do you think Tesla makes its own electronics, including the IBGTs? If so, think again. Some of the components of the integrated motor controller (including inverter) and other parts of the PEM (Power Electronics Module) are off-the-shelf parts.

The cost of the PEM for the EV powertrain, including the inverter, will come down over time and with economy of scale, but currently inverters and some of the other electronics are still rather expensive.

https://electrek.co/2016/06/29/tesla-model-3-exclusive-leak-specs-300kw-inverter-architecture-power-capacity-model-s/

Don Zenga

Vehicles ICE costs between $2,000 – $4,000 which means $1,200 for motor sounds reasonable.
Another important thing is the simple 1 speed transmission in electric vehicle should be much cheaper than the 6, 8, 9 speed or CVT transmission in typical gasmobile.

Viking79

By the same accounting Tesla loses about $10k per car sold. As we know, this is because Tesla is spending R&D and buying assets. The UBS report estimates that the Bolt EV has a positive margin of you take out some R&D costs. This $7,400 per Bolt might be accurate but is misleading. It is good if GM sells more Bolts as future EVs will benefit from that R&D and the more Bolts GM sells the lower that loss figure should be.

Quoting figures like this is what leads to people hating EVs.

Dave

Exactly, this Evannex story is completely misleading, as are most of them. GM makes money on every Bolt if you are accounting on a revenue vs “cost of goods sold” basis. However with the the low volumes on the Bolt, is it unlikely GM will ever recover their “sunk costs” which are around 275M, this was for R & D and Factory improvements. GM is going to launch a Buick Crossover off the same architecture sometime in the next year, and that may help them recover some more “sunk cost”. Bottom line, GM is going to be fine, they are learning, and getting ready to go big time into EV’s in 2021.

Another thing missing in the accounting is all the ZEV credits GM is earning, which would have otherwise had to be purchased from Tesla. So look at the Bolt as Tuition cost to lean about EV’s

Tom

Agree. Would like to add that the same tear down people when analyzing the Model 3 criticized numerous things heavily but yes they also praised certain aspects such as the drive. Also when they tore down the i3 they thought it was the greatest thing since sliced bread and were dead certain that BMW was making profit on it. They went into great detail as to why. Commenters here keep saying the i3 is too expensive. Perhaps and yet the demand has slowly increased to the point (improved vehicle too) where capacity is maxed and BMW is almost certainly making money on them and just recently announced 50% increase in production by the end of the year to meet the higher demand.

I don’t think that’s a negative about Tesla or GM’s approach, their circumstances are different. It’s just a comment that BMW does in fact know what it is doing and they do in fact know they are in a race against Tesla.

Ryan

This factory tour video of the BMW i3 factory on YouTube is fantastic: https://www.youtube.com/watch?v=pa5_tudyAF8

I can’t afford an i3, and have never really wanted one, but the video shows BMW has been serious about the vehicle. It’s really well put together assembly line.

Will

There’s a i3 Rex in Boston with 20k miles for $17k very tempted

menorman

Anyone paying MSRP for an i3 is getting hosed majorly, so you probably could afford one if you can afford most other EVs.

sveno

I don’t see much R&D potential actually in the Bolt for GM as all of the EV stuff (and more!) is from LG – so I see them gaining far more drive-train insight than GM.

agzand

It is built by LG but designed by GM. So you think Foxcon has the iPhone know-how rather than Apple?

Pushmi-Pullyu

I think — or rather, know — that the design of the Bolt EV’s powertrain was a collaborative effort between LG’s new automotive division and GM. People keep trying to suggest the entire design was either all LG or all GM, when neither is true.

People achieve far more by cooperation than competition. Partnerships exist for a reason. That’s something that seems to be forgotten in an age of increasing tribalism and divisiveness.

From Green Car Reports: “Bolt EV Powertrain: How Did GM And LG Collaborate On Design, Production?”

https://www.greencarreports.com/news/1102176_bolt-ev-powertrain-how-did-gm-and-lg-collaborate-on-design-production

Dave

On the Chevrolet Bolt, GM designed the battery chemistry, And the drive unit, they just subcontracted the production to save time and CapEx. GM maintains all of the intellectual property on the parts they designed . Not sure if that has any real value or not .

Pushmi-Pullyu

Most of that is simply not true. Read the article I linked above to see what GM contributed to the Bolt EV powertrain design, and what LG contributed.

And GM doesn’t “design” battery chemistry. They likely select what they think is best from a variety of possibilities offered by LG Chem, but GM does not do R&D in battery chemistry improvements. That’s LG Chem’s job.

EVShopper

In comments GM’s Reuss stated they own the battery chemistry. They have a huge battery lab in Michigan.

Dave

Ding Ding Ding… But don’t argue with Pu-Pu because he knows better then the president of GM…

theflew

The largest battery lab in the US belongs to GM. I think they would disagree with your statement on battery chemistry.

Paul Smith

Biggest advances aren’t always from the largest labs.

stan1

GM does do R&D on battery chemistry.

Rusty

Dr Dahn from Dalhousie was the chemistry consultant – same guy that Tesla contracted for 5 years.
https://www.youtube.com/watch?v=pxP0Cu00sZs

Pushmi-Pullyu

That’s like saying Tesla does its own battery chemistry R&D just because they have their own sophisticated battery lab.

Yeah, Tesla is capable of pretty sophisticated battery testing, and they do have patents for some of the internal components — the cell architecture, not the chemistry. And if GM has patents on specific properties of battery cells, that wouldn’t surprise me either.

But just as with GM, the ability to analyze batteries doesn’t mean Tesla invents new chemistries that are better than existing ones.

Experimenting with battery chemistries, and making year-on-year improvements, is what battery makers like Panasonic and LG Chem do. It’s not what auto makers do, regardless of what hype you may have read from someone working for GM.

Rafael Sabatini

?? Can you please cite a credible source on all this stuff you “know”?

Pushmi-Pullyu

Was that addressed to me? I already linked this article:

https://www.greencarreports.com/news/1102176_bolt-ev-powertrain-how-did-gm-and-lg-collaborate-on-design-production

If you had bothered to follow the link, you would have found this:

GM designed the electric traction motor and the battery-control system, was responsible for all integration of the powertrain into the vehicle itself, and validated all systems.

LG Chem–which supplies lithium-ion cells from Holland, Michigan, for the Chevrolet Volt and Spark EV, and the Cadillac ELR and CT6 Plug-In Hybrid–designed, engineered, and tested the Bolt EV’s battery system to performance and packaging specifications supplied by GM. (emphasis added)

But really, anyone exercising critical thinking shouldn’t need to have it explained to them that it’s LG Chem, the battery maker, who does ongoing R&D toward improving battery cells and chemistry, and not GM. That’s a specialty, and it’s frankly silly to suggest that GM would do as good a job when that’s not at all their specialty.

You have apparently confused GM (and Tesla) analyzing batteries with GM (and Tesla) designing batteries.

EVShopper

It was a shared partnership and development effort.

mx(*v*)

The assembly line is the Sonic assembly line, along with the body/frame and suspension. GM is making $10 grand per car, at a $35,000 price point. I really doubt they’re losing money, except that they only build 30,000 a year.

So, GM DEALERS are losing GM money on the Bolt by not selling it.

Pushmi-Pullyu
“This $7,400 per Bolt might be accurate but is misleading.” No, it’s never “accurate” to claim any auto maker is “losing” $XX per car. That’s at best kindergarten-level accounting. It’s at least highly misleading, if not simply wrong. Even grade-school level accounting should recognize the difference between sunk costs of R&D and tooling-up, versus the unit cost of making an individual car. Saying “so-and-so is losing X amount per car” strongly implies that they should make fewer cars so that they’ll lose less money! Of course, in many or most cases the opposite is true. The company needs to increase production, so that the economy of scale will bring down the unit cost, increasing the gross profit margin. Tesla isn’t “losing” any money on making the Model 3’s which are rolling off the production line. I have no doubt their gross profit margin is positive. The problem is, of course, that Tesla has spent far more on such things as tooling up and building Gigafactory One than they have — as yet — made in total gross profits on the car. It was absolutely necessary to build Gigafactory One, to provide the needed very high volume of battery cells Tesla… Read more »
theflew

In Tesla’s case this might not be true. For the Bolt I would assume the first saleable car coming off the line was profitable. For the Model 3 I’m not so sure given the amount of manual labor and rework we heard about.

Pushmi-Pullyu

“For the Bolt I would assume the first saleable car coming off the line was profitable.”

If you mean profitable on a per-unit basis or profitable in terms of a gross profit margin, then probably so. If you mean the Bolt EV was making an overall profit from the first day of sales, that simply isn’t credible. On average, a new model of car doesn’t make any overall profit in the first year of sales, because of R&D and tooling-up costs. For the Bolt EV we can be sure costs were significantly higher than normal.

By comparison, a Nissan exec was quoted as saying, back in 2010 or 2011, that Nissan planned to get into “black ink” (as opposed to red) in the third year of production. We might guess that GM is aiming for that with the Bolt EV, too. Altho since GM is splitting a lot more of its profits with LG Electronics/LG Chem, it may take more than 3 years.

Lamata

If Tesla Lost That Kind of Money on each car Sold , They would have been in Business for about 1 Yr. Max !..Tesla Makes Much more Profit on these cars than they lead people to Believe, They Make 90% Plus of EVERYTHING in House. ..And., These So Called Anaylists are missing a BIG part of the formula & should Stop trying to figure this out , Because They Got It All Wrong!

theflew

They’re not losing money because they aren’t selling a $35k car. Even they admit they can’t sell a $35k at this time.

menorman

To be fair, Tesla has been floated by a LOT of additional cash infusions in the past.

Stan1

“To be fair, Tesla has been floated by a LOT of additional cash infusions in the past.”

Saying that money used for R&D and capacity expansion was a means of “floating” a business is pretty slanted.

Nonbiker

If you buy an asset it’s not “loss”.

carcus

In the ICE car, a huge chunk of the cost is in the drive-train (much of it labor).

A small- ish (frugal) BEV city car , like a 120 mile (35 kwh) Fit or Golf, should be competitive if not cheaper than the ICE versions. So the frugal EV buyer can win on the purchase price, win on the fuel costs, and win on the maintenance costs.

But when you’re stuffing 80 or 90 or 100 kwh (and weight) in the car, along with fancy autopilot features, glass roofs, etc.. etc…. there is no opportunity to undercut the competition, … all you can do is “out ego” the competition …

Taylor Marks

Autopilot is a major money maker for Tesla. They’re using 8 cameras from cellphones, less than $1 each, plus 12 ultrasonics, maybe $10 each, plus a radar, maybe $20. All the sensors are definitely under $150. Then there’s the computer. It cost $3000 when it debuted 2 years ago, but Moore’s law says it costs $1500 now, and will be under $800 within 2 years.

So all the hardware only costs Tesla ~$1600 this year, and by 2020 it’ll be less than $1000, but they’re selling it for $5-10K depending on the option package you get. At least a 60% profit margin, and possibly as high as 90%. They’d be idiots to not offer it with margins like that.

carcus

You left out the liability costs.

… and all the programming … that’s free I guess?
.. and not to mention the wiring harness and the complication/labor that goes into installing all of the sensors

Stan1

There are no liability costs and no reason for them to exist.

carcus

And that’s before we get to the consumer costs,..

There will always be some sort of subscription price to autopilot, the database has to be continually updated .. that’s not free.
Will Tesla (and the others) require an annual service visit to verify calibration/ system operation? … will insurance require it?
If you fail to comply, will they just disable your autopilot, or will the other safety systems be involved that may prevent your car from passing a safety inspection — thus rendering your car essentially useless ?

–just like any networked personal computer …. it’s never just a one time purchase

Pushmi-Pullyu

You’re ignoring the cost of software development. I agree that Tesla would be idiots not to offer the package, because they only have to pay for software development once (altho at Tesla that is an endless ongoing expense), and then they can make infinite copies nearly for free. But development does cost something.

EVShopper

“GM has said that it expects its electric cars to become profitable by 2021”

You forgot the context of that statement was about making a profit on affordable EVs that do not have a price premium over their ICE counterparts.

People wrongly try to compare the Bolt EV to a sub-$20k econobox, but it is fair to compare it more to a hot hatch at $25k (like the Golf GTI). And even though they may be comparable at a TCO level, that initial premium upfront cost is a barrier.

So I would expect to see the Bolt eventually come down in price to the mid $20k’s as battery prices fall and as they scale up EV production.

ffbj

I expect you are wrong. In fact the price will rise as the tax credit falls.
They lose money on them now, quite a bit. So how is the price going into the 20’s?

menorman

GM already advertises the Bolt using the magic asterisk. Losing the tax credit would take that away from them and by then, the base Model 3 is likely to be out which starts cheaper than the Bolt does. Plus the Kona EV, Niro EV, and other entrants which still be eligible for the tax credit, which puts steep pressure on Bolt pricing.

Will

Kona, Niro are compliance

EVShopper

I think it is highly unlikely they are losing money on the Bolt EV.

David Murray

Something doesn’t add up. The article says it costs $30,000 to build a Model-S. And yet it costs $42,000 to to build a Model 3? I thought the Model-3 should be cheaper to build?

That’s only for now. They’ve had years to work out Model S build. Model 3 is new and lines are new. This is how it always works. That’s why Musk keeps saying that lower cost Model 3’s will come over time.

ffbj

Plus the 3 has some superior (more expensive) components.

mx9119

The model 3 has many fewer components.

agzand

The $30k is direct material/labor bill. Tesla has other costs, like non-factory employees, interest expense, supercharger network, etc. The final sale price should cover all those costs.

Dave

Those numbers cannot be right, Model S is much more expensive to build as it is built from aluminum which is quite a bit more expensive .

Pushmi-Pullyu
“Something doesn’t add up.” The problem is that they are adding up things which shouldn’t be. As in, they’re adding the sunk costs of the entire development of the Model 3 and all the things Tesla has built to supply it, including Gigafactory One, and dividing that by the number of Model 3’s which have been built so far. But that’s a ridiculous analysis. It assumes Tesla will never make another unit of the Model 3! As TM3 production grows, those development costs will be spread out over more units, and — GASP! — the cost per car will “magically” drop over time! It’s normal for auto makers to make no overall profit in the first year of producing a new model. For the Model 3, it may actually take longer, because of the large costs associated with Tesla’s rapid growth. But it’s just brain-dead to say “GM was losing $7,400 on every Bolt sold”, and equally clueless to say Tesla is “losing X amount on every Model 3 sold.” Nobody who knows anything about finances counts costs that way. I know that despite the fact that I treasure my ignorance of financial matters! So why do we keep seeing… Read more »
Another Euro Point of view

I saw a study not long ago pointing out that, out of the total cost of car, only about 50-52% is labor and parts (that includes battery, motor, body etc…). Rest is R&D, cost of servicing the debt if any, amortizing, marketing, distribution, warranties, rest of SG&A etc..IMO knowing when a car is profitable or not for a company is way too complex/difficult a subject to be addressed and commented by non specialists on an EV enthusiast site.

Pushmi-Pullyu

Well, it’s certainly too complex/difficult for a writer who thinks it’s appropriate to say that “GM was losing $7,400 on every Bolt sold”, and states that Tesla is currently losing money on producing and selling Model 3’s. (I guess they should stop making them, so they can quit “losing” money? /sarcasm)

However, if the writer would recognize the difference between sunk costs, ongoing costs, and unit costs, then those costs could be individually summarized, and a reasonable estimate could be made of just when Tesla could be expected to start making an overall net profit on the Model 3, rather than just a gross profit on a per-unit basis as Tesla is now.

R.S

Gross margin isn’t the same as profit. Gross margin doesn’t include what the car maker needs to pay for sales, shipping, advertisement and development costs, which is a lot.

According to UBS the Bolt has a positive gross margin 10% even, but that’s not enough to actually make money with it (of course the biggest factor is sales volume).

Another Euro point of view

Indeed, but as far as judging if a business venture is successful or not gross margin won’t tell you much. Specially considering that each one of those car manufacturers do have their own recipe slightly or greatly different to calculate this gross margin. Enough time wasted now, next comment in July 😉

Pushmi-Pullyu

“…as far as judging if a business venture is successful or not gross margin won’t tell you much.”

True, but gross margin will tell you if you should continue to make a product, or stop making it. The problem with kindergarten-level comments like “GM was losing $7,400 on every Bolt sold” is that strongly suggests GM should have stopped making the car!

Even in a popular article like this one, the writer should separate out sunk costs and unit costs. Lumping those together makes any discussion of costs pointless and meaningless.

Tom

I’m agreeing with Pu Pu…hold me I’m scared. One more obvious thing gross margin will tell you. If it is positive as already mentioned you need to know more. But if it is negative you should go do something else. The old dotcom adage of ‘we lose money on every sale but will make it up in volume’ leads to pets.com. I would imagine there’s positive gross margin on all Tesla products as well as Volt II and Bolt….probably not Volt I.

Ambulator

That adage is much older than the dotcom phenomenon.

Get Real

Tesla’s major advantages are on scale and batteries and demand for their excellent products/ecosystem.

Only Tesla thus far is really scaling up on BEVs (VAG looks to be the next company to really scale) and with this scale comes much reduced costs as they can spread their CAPEX and R&D over many more units.

And since the battery cost is the single largest cost in a compelling BEV, Tesla is far ahead on this key front too in terms of scale, cost reduction and technology with their in-house Gigafactory.

Remember–Tesla is already using less of the expensive Cobalt now in their Giga-produced cells then their rival’s next generation NMC 811 that hasn’t even gone into cars yet.

And then their is demand.

It is obvious that the legacy, laggard OEMs are deathly afraid of the transition away from their profitable LICE crap and they therefore are slow-walking the inevitable transition to full electrification so they do virtually nothing to up the demand for their EVs.

The laggard, legacy OEMs are totally reliant on 3rd parties for battery supply and charging networks whereas Tesla brought both in house and now reap the numerous advantages of their strategy.

theflew

The only benefit Tesla has is batteries. All other major manufactures have a lot more “scaling” capabilities.

floydboy

Access to an in house, steady battery supply IS the “scaling capability” for EVs.

101101

UBS is not credible.

Kdawg

“Rebecca Lindland told IBD, adding that Toyota reportedly needed more than 10 years to turn a profit on the hybrid Prius.”
——–
It was actually a 17 year journey to make the Prius profitable. The Volt, which is technically a hybrid, but with large battery and plug that lets it be an EV first, achieved profitability by Gen2, which came 6 years after the first generation. I believe it costs GM less to build a Bolt EV than what they sell it for. Debate can be had about the R&D costs and costs of setting up the lines, but to me that’s the cost of doing business. It’s also IP they own which has value. We’ve already seen the technology/knowledge spread to other vehicles.

Dave

GM lost a fortune on the Gen 1 Volt, but they are doing better on Gen 2… Sounds like they are going to give up on that though, and focus on BEV’s.

theflew

Just because they don’t make another Volt doesn’t mean they are giving up on the technology – sedans are old news.

Ryan

It’s a shame really — I feel like it’s a failure of marketing, and a failure of the dealers, rather than a failure of the PHEV concept. The Volt is an excellent car and pure BEV is not for everyone. I drive 105km a day in my Volt 89% of my miles have been electric (charging at work and home) and not having to haul around a very expensive 60kwh battery to do it is wonderful. If the world’s drivers were to switch to PHEVs even as an intermediate step, CO2 emissions would drop significantly.

David Cary

Failure of the size of the car (IMO). People want bigger cars, myself included. People will tolerate small cars if they are really cheap.

The Volt is a great concept – just not in the Volt size. Sounds like GM maybe getting that.

Pushmi-Pullyu

An article from Evannex that cites one of Navigant’s clueless forecasts, and draws heavily from the very flawed Munro teardown analysis of the Model 3, which pretty thoroughly exposed just how little Munro and his associates understand electric powertrains and modern electronic circuit boards, as well as their lack of understanding that the heavy battery pack needs the car’s frame to be extra strong?

::facepalm:: The blind leading the blind!

Quite a few electrons here were seriously inconvenienced for no good purpose. :-/

Hunter

How can the Model S have a cost of only $30k but Tesla needs to sell the much cheaper Model 3 at $42.5 just to break even?

$30k sounds way too low for the Model S.

scottf200

Via Steven Loveday
That’s only for now. They’ve had years to work out Model S build. Model 3 is new and lines are new. This is how it always works. That’s why Musk keeps saying that lower cost Model 3’s will come over time.

Lamata

GM indirectly makes money on these Compliance Cars ..Because it gets Gets “Carbon Credits” for every Bolt they Build and in turn allows them to sell “More Big Gas Guzzlers , where the BIG Profits come in Play ..They May Lose a little on the Bolt , (Which I Refuse to Believe)…As The Big Profits Roll in from the Gas Guzzling Monster Trucks .

menorman

So does Tesla and every other company making BEVs/PHEVs…

Unplugged

Interesting that Tesla makes a profit of “$30,000” on the Model S, which starts at $70K. So the Model S costs Tesla around $40K to build? But Tesla needs to sell the Model 3 at $42K to break even. Really?

I think UBS needs to go back to the drawing board.

arne-nl

No, read again. The ‘marginal cost’ of the Model S is $30 k. Something quite different.

Don Zenga

Bolt with length, width, height of Bolt 164″ * 70″ * 63″ respectively is smaller than 168″ * 70″ * 65″ respectively. Trax has a starting price of $21,000.

Lets calc from here.
$21,000
– $2,000 (Typical Engine cost of small car)
= $19,000
+ $1,000 (Motor cost)
= $20,200

Cost of Bolt’s battery of 60 KWh.
If we take bloombergs price of $209 / KWh, then it comes to $209 * 60 = $12,540.
Then $20,200 + $12,540 = $32,740

If we take the price specified by GM executive of $145 / KWh, then it comes to $149 * 60 = $8,700
Then $20,200 + $8,700 = $28,900

Either way GM makes a big profit, besides Bolt is smaller than Trax in length and height, so the profit margin is even more.

So why is the UBS analyst giving these wrong figures. Because they have more investments in oil companies, so they want to spread false news with false calculations.

Pushmi-Pullyu

“So why is the UBS analyst giving these wrong figures. Because they have more investments in oil companies…”

Perhaps, but I think you’re giving them too much credit.

“Never attribute to malice that which is adequately explained by stupidity.” — Hanlon’s Razor

CIO

“*This article comes to us courtesy of EVANNEX (which also makes aftermarket Tesla accessories). Authored by Charles Morris. The opinions expressed in these articles are not necessarily our own at InsideEVs.”

In other words agenda driven self serving misinformation masquerading as news. I’m sure Tesla benefits in many ways as an early entrant but GM and the other legacy manufacturers have been making money for their shareholders for a long time and know how to time the market, mass produce quality and appeal to consumer taste. I love competition and that’s what we’re going to have in coming years.

EaglesPDX

Current basic upgraded Model 3’s have a sticker of $56,000. So Tesla is making 33% profit on the Model 3’s. That’s pretty good gross profit. And the prices and profits are going up with AWD coming out later this year along with the crazy performance model.

David Cary

You are quoting with Autopilot? Hence the confusing “basic upgraded” term.
Lots of people like to say Autopilot is a given since why would you not get it. I have a 3yo AP1 car that I paid $2500 for the option. I like it, don’t really want to give it up, but not sure that current iteration is worth $5k.

Robb Stark

I estimate UBS is 95% bovine feces.

jonathan

While the Tesla looks better on the outside. inside it is sorely lacking. Just a center unit to look at seems mighty dull you must keep turning your head to see your speed. Not to mention the poor stopping of this car and small trunk and no head room and uncomfortable seating position in the back seat in the back seat It just seems just a bit poorly designed. While the Bolt is not owe inspiring to look at it performs very well. Quick breaking and very functional displays. As long as you are caught up in feeling the dashboard this car is by far the better choice.

MaartenV

Is this the UBS estimate from before the launch of the Model 3?
Just based on what they did learn from the teardown of the GM-Bolt.
In that case not very solid numbers.

Null

The presumed $/kwh is far higher then Tesla stated.

If you get the largest cost component horridly wrong, well, so much for you analysis.

Bill Howland

All the Big Experts – including the self-appointed ones here, seem convinced GM is losing money on the BOLT ev. Doesn’t look that way to me since they are selling for considerably cheaper in Canada where, in view of the price, they probably ARE losing money there.

The Bolt ev looks to me to be an optimized, cost-reduced product of very simple design (only 1 motor, inverter/rectifier, smallish charger, and simple but extremely robust Double-Reduction gearbox). The LG ‘collaboration’ seems to be in the interest of keeping the costs extremely low.

Monro Associates almost Juvenile gushing over a standard NVIDIA board is a real-eyebrow raiser. He was apparently clueless that this was not a Tesla Board, other than being the particular version sold to them.

As far as the batteries in the ‘3’ being ‘oh so advanced’, one would be prudent to see if these things explode so violently as they do in the “S”, and “X”. If so they are dangerous compared to the relatively safe LG pouches.

Narg

“Munro also recently tore down Model 3, and was highly impressed with Tesla’s battery, saying that Korean suppliers LG and Samsung have long been considered the best in the battery business, but that the Model 3 pack “blows them both away.” – So, just because of looks it’s better? Funny how idiots figure things out. Looks do nothing for how well it’s made for what it’s use is.

Bill Howland

Yeah I’m not sure Munro has much of a valuable opinion on anything electrical.
He’d do much better asking purchasers of the cars what problems they are having…

One thing in the video of him that was eyebrow raising: He SAID he couldn’t figure out why a vibration damper was installed….

Well DUH, take the thing off and see how it changes the car’s performance.

The guy is resting on his laurels.