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What do you expect from the big 3?

You want your hybrids and electric cars ?

Be careful what you ask for. You’re asking them to cut their own profits.



Here is a quick primer on the auto dealership business. The service, collision and parts department – known as the “back-end business” – is where the real profits are because they present opportunities for management efficiencies, not to mention that dealerships can charge more per hour than they pay for labor. The same goes for parts, which are bought wholesale and marked up for retail just as in any other business. This segment has grown over the years as dealers have been able to sell cars and then keep the buyers coming back to service their vehicles. Estimates are, for example, that nearly two out of every three people who buy one of their vehicles get it serviced at one of their dealerships. With the profit margin on a new car at 2 to 10 %…go figure



How many times do you think a Prius or an all electric car need service. Ask a Prius owner or Toyota dealership how much money they save. Toyota still makes their money on their gas guzzlers with the IC motors and lots of maintenance.



Suppliers will go out of business if plug ins and all electrics are the norm.

Be careful what you ask for…unless you have a huge govt. backed nation wide plan for reeducation and cross training.



My point…it’s not a simple, blame the big three arguement.

Hybrid vehicles are more complicated than other vehicles. They have everything any other car has plus a great big storage battery, regenerative braking, and electric drive for the wheels. That automatically makes them more expensive to maintain.

When the load is spead out between different drives, esp in the case of the Volt where the electric is the drive motor only (with no transmission), maintenance is decreased. Regenerative braking save brakes, all putting the load on the electric motor…the ultimate in longevity low maintenance. Tune ups are decreased and the computer controls the load on the IC, increasing its longevity.

Series drive hybrids with NO tranny are LESS complicated and have FEWER moving parts. That’s why GM is so reluctant to bring them out. They will never see them again in their repair shop.

The new Lexus AWD has no center diff. just an electric in back to drive the rears on command.

The electric motor is our ultimate drive motor…even for nuclear powered navy vessels.

That spells the end of the big three.

How does the Volt spell the end of the Big Three?

If cars with series hybrid drive trains (like the Volt) and day trip electric vehicle only become the norm, there is very little profit potential for the traditional auto industry. Do you really think auto companies make enough profit on their new car sales to survive ?

Guess you didn’t read the original post. The Volt is a much easier concept to develope than the Prius; a car like it could have been on the market 20 years ago.
Jay Leno drives an electric car made in the early 1900’s that gets 100 miles to a charge. Mechanics are original, INCLUDING THE BATTERY.

Any new car dealers out there that dispute how important parts and service are to their survival ?

That electrics and plug in hybrids are not common place has much more to do with marketing than R and D. If we don’t get it, we have been as successfully duped like the cigarette CEO’s did to us for years.

My point is…we have to be careful about the transition, not because it can’t be done, but because of the effect on our already fragile economy.

Wrong…the modern car disproves that conjecture.