What if there were two different Camaro interiors?

JakeRobb
01-04-2008, 11:14 PM
In another thread, I saw this question:

What i don't get is, WHY go with a retro interior that is so polarizing in a car that HAS to be a homerun?

Which got me thinking. Even though we know the interior spy shots we've seen can't possibly be what we'll see when the car reaches production, it's still obvious that GM is pursuing the retro interior design to some extent. The console-mounted gauges are there, as are the weird rectangular speedo and tach gauge housings.

But then I thought about the GMT900 trucks. There are two very different interiors available in those trucks. One very modern, and one more traditional for a full-size truck.

Who's to say that GM isn't pursuing a similar approach with Camaro? Maybe the plan is to allow buyers to choose between a concept-style retro interior and a more modern design like the ones that so many others have mentioned (G8, Malibu, CTS).

I think that would definitely help the Camaro be the home run that it needs to be. Some people love the retro interior and think a modern interior would ruin the car's overall style statement, while at the same time others feel that a retro interior is unacceptable.

Steve83ta
01-05-2008, 12:21 AM
Which got me thinking. Even though we know the interior spy shots we've seen can't possibly be what we'll see when the car reaches production, it's still obvious that GM is pursuing the retro interior design to some extent. The console-mounted gauges are there, as are the weird rectangular speedo and tach gauge housings.

I was thinking the exact same thing. I was looking at the high res. pics on Autoblog.com earlier and I swear I'm seeing a second fuel gauge. At least that's what it looks like to me. Take a look at the pic that was taken from the passenger seat vantage point. Now look at the tach. There is what looks like to be a second gauge there. Now why do you need two fuel gauges???

90 Z28SS
01-05-2008, 01:00 AM
In a high volume/high profit margin truck I can see the flexiblity to please all with a nice interior and then a traditional truck interior . In a car thats lucky its here at all , thats just not gonna happen .

The prototype probably does have an extra fuel guage . The 4 on the console I doubt even function .

JakeRobb
01-05-2008, 09:29 AM
In a car thats lucky it's here at all, that's just not gonna happen.

Everything I've seen points to the Zeta platform (including Camaro) being intended to be a pretty high-volume seller. They're already going to have the line set up to accept multiple different cars with multiple different interiors, so I see no reason to rule this out for logistics reasons.

BigDarknFast
01-05-2008, 11:16 AM
I can relate how some might want a wide interior choice in the new Camaro. Sort of like how you could get a Berlinetta interior in the 1980's. But those days are long gone. It likely costs a lot more than it used to, to do such a thing in a modern car. This is one reason why power windows have become so much more common in cars. Its cheaper to equip every variant with them, then to design, test, and complicate builds with two sets of door panels, wire harnesses, controls, etc.

I want my new Camaro to be affordable. That's always been, and will no doubt continue to be, part of Camaro DNA. I'm sorry to say it - but I don't want to have to also 'help pay for' or 'subsidize' another variant of interior with my purchase. I like the heritage interior of the concept; and I hope the production car is similar but I will wait and see before making a lot of judgements and scenario-rustling.

Big Als Z
01-05-2008, 11:40 AM
I just had a similar idea...

this is from the Fbodyfather thread

Lets just say, hypotheticly GM got bad press over the interior. I would assume that there are or were at least 2 or 3 other designs in the running. How much longer would it take for GM to reverse gear, get one of the other designs ready for production, send it out to suppliers, and get it mocked up and ready?

JakeRobb
01-05-2008, 01:09 PM
I want my new Camaro to be affordable. That's always been, and will no doubt continue to be, part of Camaro DNA. I'm sorry to say it - but I don't want to have to also 'help pay for' or 'subsidize' another variant of interior with my purchase.

The thing you're missing is that Camaro will no longer be by itself on a unique platform (no, I didn't forget about Firebird... but the interior was the same ;)). The Zeta platform is going to underpin at least three cars, and I'm thinking GM will expand it to include a couple more.

Those other cars will help subsidize Camaro -- not the other way around. :)

jg95z28
01-05-2008, 01:57 PM
Production would be too expensive. Other than leather or cloth seats, I don't see many drastic differences other than an "LT" or "SS" might have more chrome.

Big Als Z
01-05-2008, 02:04 PM
I can see possibly different types of seats. A RWD Chevy sedan could get a heavy sport seat and be shared with the Camaro.
Camaro should have more then just one style seat, unless that seat is very supportive where all it would take would maybe be some additonal padding for a top shelf Camaro. I would think it would be cheaper to have 1 really good seat then making 2 seats.
Or that if there were 2 seats, that 1 would come from another car on the line, while the Camaro designed seat was set up for everything above sport.

JakeRobb
01-05-2008, 04:04 PM
Production would be too expensive.
Do you (and others who have made similar claims) have some sort of basis for this? Remember that Zeta is going to be a high-volume platform with lots of flexibility. Why wouldn't it be able to support two different Camaro interiors?

Silverado C-10
01-05-2008, 04:15 PM
The camaro was ALREADY SUPPOSED to be sharing a platform with several other GM cars, which apparently, are now more than likely dead in the water? So now, there's an even smaller business case for the camaro and HOPEFULLY GM will still be able to keep it priced close to a mustang even without the other US variants to share costs with. *IF* all the G8 variants do come (el camino? and wagon) I still can't see all three pontiacs accounting for much more than 200-250K in sales, and I feel even that is optimistic. The impala is likely dead? Maybe a caddy? But again, probably not a car that will sell more than 100K/year. I REALLY think to keep costs down the Impala NEEDED to be part of zeta. There's your high volume car....

The GMT900's can afford 2 different interiors. The profit margin on a truck is very high (I've read it's 6-8K) and the profit margin on GM (and other) cars is fairly small (just 1-3K in some cases.) The GMT-900's also share a platform that sells WELL over a million vehicles per year and at the high profit margin whereas the camaro (once the dust settles the first year) will probably settle in around 75-100K/year (hopefully more, but with more and more sporty coupes coming to market, who knows.)

I guess my point is, I don't see a second interior as an option.

90 Z28SS
01-05-2008, 07:49 PM
Do you (and others who have made similar claims) have some sort of basis for this? Remember that Zeta is going to be a high-volume platform with lots of flexibility. Why wouldn't it be able to support two different Camaro interiors?

Interiors are a VERY costly part of the car design . you start mixing up different configurations which require specific wiring and trim ect ect ect , and the cost EXPLODES . That is why today , most options are bundled together and their arent any where near the individual option or color selection there used to be . Even over the last few years with alot OEM's , ALOT of tan or red interiors are simply just accented with red or tan seats and other various removeable panels like knee bolsters and door panel inserts ...so the main parts of the interior like the carpet , plastic and dash can remain ebony , graphite or black ....Much cheaper way to offer color options as opposed to have 3 or 4 different colors of the entire interior .

Even at 100K a year , the profit margin will not be there on a car like there is in a truck .

Z28Wilson
01-05-2008, 09:18 PM
Remember that Zeta is going to be a high-volume platform with lots of flexibility. Why wouldn't it be able to support two different Camaro interiors?

The Chevy Zeta sedan is dead right now according to public releases. So much for a lot of North American volume. Camaro is a specialized Zeta of sorts. Even at 100,000/year, there just isn't enough there to justify spending on 2 radically different interiors for Camaro.

What's done is done. Let's just hope for the best.

JakeRobb
01-05-2008, 11:26 PM
Let's just hope for the best.

That's what I'm doing. :D

Fenster
01-08-2008, 02:01 PM
The volume of the vehicle cannot justify the added complexity and added complexity costs of such an interior. With one interior the development costs are spread across every vehicle as it the piece costs. Adding another interior would double those costs and be almost a 4x increase in costs that would be passed on to the customer. Instead of cutting one sum into half, you are doubling the costs, and are not able to spread it against as many vehicles.

Geoff Chadwick
01-08-2008, 03:21 PM
Adding another interior would double those costs and be almost a 4x increase in costs that would be passed on to the customer. Instead of cutting one sum into half, you are doubling the costs, and are not able to spread it against as many vehicles.

If it costs $1,000,000 to design an interior
And you plan on selling 100,000 cars:

The cost passed to each car is $10.

If you develop two such interiors at the same cost and sell the same number of cars:

The cost passed to each car is $20.

The number of vehicles stays the same, it does not change. The cost to distribute to those vehicles doubles. Where did the "be almost 4x increase in costs" come from?

JakeRobb
01-08-2008, 03:28 PM
If it costs $1,000,000 to design an interior
And you plan on selling 100,000 cars:

The cost passed to each car is $10.

If you develop two such interiors at the same cost and sell the same number of cars:

The cost passed to each car is $20.

The number of vehicles stays the same, it does not change. The cost to distribute to those vehicles doubles. Where did the "be almost 4x increase in costs" come from?

Yeah. I wasn't following the math either (and I minored in math!). To me, it seems like it would add a few dollars to each car. Assuming that production levels of each version of the interior were high enough, I think the added cost would be negligible. It would take additional time and/or manpower to develop/test/certify/etc the two interiors, but I don't see how it would have a significant impact on the final cost of the car.

Fenster
01-08-2008, 03:32 PM
Your math is correct on the inititial investment that would need to be spread to the customers for the different investments. However you forget the piece cost increase added by having a lower supplier volume of each part, and thus a lower discount to GM to buy a higher quantity. Each part costs more to GM and thus is passed. Is the 4x right... obviously not, but I was trying to make a point that from a business sense it is NOT something that works.

Fenster
01-08-2008, 03:36 PM
Yeah. I wasn't following the math either (and I minored in math!). To me, it seems like it would add a few dollars to each car. Assuming that production levels of each version of the interior were high enough, I think the added cost would be negligible. It would take additional time and/or manpower to develop/test/certify/etc the two interiors, but I don't see how it would have a significant impact on the final cost of the car.

The added cost would definately not be negligible IMO, especially on a car that has cost to build and price to sell as a HIGH priority to make 100k units, or to maintain an appropriate # of units to continue selling. The piece cost like I said will actually play more a role than the development costs when you sit down and look at the actual cost of each part added to the vehicle. When GM sits down and looks at what they are making on every vehicle they sell those costs are not something that has to be quantified into enough extra sales to justify the risk of the added investment.

In this case I can not simply say it would be justified.

<I have a "little" experience in vehicle planning... ;)>

JakeRobb
01-08-2008, 03:37 PM
However you forget the piece cost increase added by having a lower supplier volume of each part

I really don't think GM is going to get a different per-unit price from any supplier at 50,000 units per year than they would be able to get at 100,000/year.

Fenster
01-08-2008, 03:45 PM
I really don't think GM is going to get a different per-unit price from any supplier at 50,000 units per year than they would be able to get at 100,000/year.

Well... we will then have to agree to disagree. I can almost guarantee there would be extra costs involved, no matter how "minuscule" that would be to some people. Those nickels and dimes add up.

BigDarknFast
01-08-2008, 04:30 PM
Well... we will then have to agree to disagree. I can almost guarantee there would be extra costs involved, no matter how "minuscule" that would be to some people. Those nickels and dimes add up.
I agree about the additional costs. And not just development either - also the cost of replacement parts, dealer repairs (more complex service manuals and bulletins), and even consumer warranties. I sometimes buy extended GMPP warranties, and don't want to pay extra to 'subsidize' someone else's desire for a whole different interior.

I believe there should be just one basic interior offered on the car. Those who cannot come to terms with it - and cannot see what else the car has to offer (knockout exterior styling, modern features and reliability, RWD/IRS, outstanding value) - well maybe the new Camaro is not for everyone out there.

I do think though - if the interior is released with heritage cues disliked by some (and no one really knows yet, what the production interior actually looks like) - the aftermarket will step in and offer a lot of alternatives. That is, IF there are really that many folks who demand such things once they buy and start driving their new Camaro.

JakeRobb
01-08-2008, 04:33 PM
I do think though - if the interior is released with heritage cues disliked by some (and no one really knows yet, what the production interior actually looks like) - the aftermarket will step in and offer a lot of alternatives. That is, IF there are really that many folks who demand such things once they buy and start driving their new Camaro.

I have yet to see any significant aftermarket interior modification for any car. A new gauge cluster, new seats, A-pillar with gauge pods... but have you ever seen a replacement dash, center stack, or center console that was designed to fit a specific car and wasn't just an OEM replacement? More to the point, have you ever seen a complete interior overhaul sold as a kit?

Geoff Chadwick
01-08-2008, 04:59 PM
However you forget the piece cost increase added by having a lower supplier volume of each part, and thus a lower discount to GM to buy a higher quantity.


Ah okay. Your wording through me off and I didn't register you were talking of actual part/assembly cost changes as well as development.

The real killer (I think) is that (1) suppliers need to stock twice as many parts and (2) that swapping a whole dashboard assembly might be a formidable task on an assembly line. Piece costs aside (and yes, there most likely is a cost savings from 50k to 100k, how much is an unknown though).

I think rolled into a special package or something (and add like $500-$600 for the cost of the dashboard/center stack) it might be possible. Expensive, but possible.

BigDarknFast
01-08-2008, 05:07 PM
I have yet to see any significant aftermarket interior modification for any car. A new gauge cluster, new seats, A-pillar with gauge pods... but have you ever seen a replacement dash, center stack, or center console that was designed to fit a specific car and wasn't just an OEM replacement? More to the point, have you ever seen a complete interior overhaul sold as a kit?

Other than applique kits (such as http://www.wooddashexperts.com/catalog/Full_Kit_33_Pcs-p-35995.html ), obviously no one is going to offer entire IP's etc. But the console gauges for example - that's an easy item to remedy and a simple thing to offer a product for. The product might be a little sunglass bin that replaces the gauges there, possibly with a set of digital or analog gauges for another location on the dash. It appears, most of those complaining about the cobbled, half-done interior pix already seen, are most anxious about one or two specific features - such as the console gauges.

Rampant
01-08-2008, 05:26 PM
If it costs $1,000,000 to design an interior.....

And what about testing for the two interiors? Passing governmental crash testing? tooling? Production line/inventory management? replacement part production/management? assembly line and even salesmen training?

It is not nearly as easy as saying "hey, let's spend an extra $1mil and do a second interior option."

That being said, there is one vehicle, and only one vehicle I have EVER seen that offers a completely different second dash choice. And that vehicle is the Silverado. Even the F-150 has only a slight difference to the center stack between its models (for column or floor shifters).

So, if anyone will do it, it is GM. But, it just isn't going to happen with the Camaro.

Besides, didn't you hear Scott -- you will like the production interior when you see it. Hold off until then.

JakeRobb
01-08-2008, 05:43 PM
You guys all suck at the "what if" game. :mad:

:p

Geoff Chadwick
01-08-2008, 11:16 PM
And what about testing for the two interiors? Passing governmental crash testing? tooling? Production line/inventory management? replacement part production/management? assembly line and even salesmen training?

It is not nearly as easy as saying "hey, let's spend an extra $1mil and do a second interior option."

Easy there. I realize all of those things, and was just throwing a number out there. Testing and developing one interior would (approx) cost the same as another. Salesman training would be the only difference between them, but honestly thats not a huge cost compared to everything else.

And If its still styled like this, I *wont* like the interior. I have always been fond of the more "fighter jet" like wraparound cockpits, which we certainly will not see.

BigDarknFast
01-09-2008, 12:09 AM
I have always been fond of the more "fighter jet" like wraparound cockpits, which we certainly will not see.
I have a tendency to like those too. But I've noticed something else with those... a lot of them leave me with a 'confined' or 'cant move around' feeling. I'm starting to swing back the other way now, and to like having a little room to reposition my knees now and then. YMMV...

Chris 96 WS6
01-09-2008, 08:10 AM
I think Fenster has nailed this issue. Thanks for bringing your industry knowledge to bear on this topic so us "lay people" can see the whole picture!

I'd only like to add that the number thrown out of $1m to design an interior is probably low at least by a factor of 10.

You have wages/benefits for the designer(s), the engineers, etc. Then you have the wages and materials costs of the machine shop or equivalent that makes all the mock up pieces. Then you have the costs to create the dyes and molds, etc. Then you add in the testing requirements as mentioned above and the added piece costs.

Then there's the added costs at the assembly plant where you have to accomodate installation of two totally different interiors. It was different with the F-body because the interior skeleton was the same, it was only trim pieces that really differed.

10 employees with a $100,000 annual package each (which could be low when you do salary + benefits + ss/medicare, etc.) is $1m by itself.

I'd say $10-15m to do a second interior, maybe quite a bit more. That's $300 per car, not $20. Add in the piece costs and you might be adding $500 to the cost of EACH car.

Dragoneye
01-09-2008, 09:00 AM
I believe since the concept car is said to be worth 2m...that's where the 1m to do-up an interior came from. Not saying I agree with it, just that I don't think it was pulled out of the air.

Chris 96 WS6
01-09-2008, 09:03 AM
I don't think you can translate the cost to build a concept car in any way with the cost to do a production interior. The concept's parts were all basically hand made. I doubt any of it converts over...meaning everything had to be designed/prototyped/etc fresh for the production version.

I'd also say that $2m is way low too.

Fenster
01-09-2008, 09:11 AM
Oh the overall investment of the car is a lot higher than people would ever think. The cost to design, develop, and test a vehicle such as the Camaro is MUCH higher than you could ever estimate based on a one off concept.

Chris 96 WS6
01-09-2008, 09:15 AM
Oh the overall investment of the car is a lot higher than people would ever think. The cost to design, develop, and test a vehicle such as the Camaro is MUCH higher than you could ever estimate based on a one off concept.

Remember GM spent $1 BILLION on the 1988 full size truck redesign. That was 20 years ago.

The last Taurus (before the 500/Taurus) was like half a bil. I'd bet the Camaro exceeds $250 million in development costs by the time its all done. The idea that the interior is only $1m of that is absurd.

Remember Scott has told us before that just to do a totally new set of wheels for the 35th anniversary SS would have cost $1m.

I just think most folks don't really have a concept of how much this stuff costs to do. There's a reason cars are only redesigned every 5-7 years. There's also a reason no other single model (excluding corporate clones/cousins) on the market has two interiors to choose from. It is expensive. You either pass that along to the customer, and lose sales due to missing your price point, or you eat it and lose potential profit.

JakeRobb
01-09-2008, 09:50 AM
Easy there. I realize all of those things, and was just throwing a number out there.

Quoted for emphasis. It's not about the number! It's just a way to show that it would be amortized against a lot of cars over a long period of time. The actual number had essentially nothing to do with the point! :)

And, again, you guys SUCK at playing "what if". :p

BigDarknFast
01-09-2008, 09:51 AM
Remember GM spent $1 BILLION on the 1988 full size truck redesign. That was 20 years ago.

The last Taurus (before the 500/Taurus) was like half a bil. I'd bet the Camaro exceeds $250 million in development costs by the time its all done. The idea that the interior is only $1m of that is absurd.

Remember Scott has told us before that just to do a totally new set of wheels for the 35th anniversary SS would have cost $1m.

I just think most folks don't really have a concept of how much this stuff costs to do. There's a reason cars are only redesigned every 5-7 years. There's also a reason no other single model (excluding corporate clones/cousins) on the market has two interiors to choose from. It is expensive. You either pass that along to the customer, and lose sales due to missing your price point, or you eat it and lose potential profit.
Amen to that. There's all kinds of testing needed nowadays, which drives up costs. One example - EMC (electromagnetic compatibility) testing. They have to test all the electronic components (in all configurations - to include all interiors) together, to make sure they don't cause spikes, noise, or other weird electrical problems for the car. Designing, testing and producing modern cars has become an incredibly complex business.

Chris 96 WS6
01-09-2008, 09:52 AM
Quoted for emphasis. It's not about the number! It's just a way to show that it would be amortized against a lot of cars over a long period of time. The actual number had essentially nothing to do with the point! :)



Again, you're being silly. It has EVERYTHING to do with the number if the number is too high to make business sense. Of course the cost would be spread out over a lot of cars. But its still a lot of money PER CAR.

BigDarknFast
01-09-2008, 09:55 AM
Again, you're being silly. It has EVERYTHING to do with the number if the number is too high to make business sense. Of course the cost would be spread out over a lot of cars. But its still a lot of money PER CAR.
And per car... means something quite a bit different for a niche car like the Camaro, vs. the huge sales volume of the pickup truck segment (vis-a-vis the Silverado example given earlier).

JakeRobb
01-09-2008, 11:48 AM
Again, you're being silly. It has EVERYTHING to do with the number if the number is too high to make business sense. Of course the cost would be spread out over a lot of cars. But its still a lot of money PER CAR.

Fine. New scenario. Here are my assumptions:
* it costs 250 million to develop, test, set up tooling for, etc, for a new interior
* Camaro moves 100k units/year.
* it goes four years without major changes to the interior.
* one of the interiors is considered to be "better" than the other and is sold as an extra-cost option
* the optional interior accounts for 35% of sales

Doing the math, the optional interior would need to cost at least $1786 per car.

That's a pretty pricey option, but it's not entirely unreasonable as an option. The nicer 4LT leather interior in the C6 is an extra $3540, which is almost exactly double my predicted cost. Since the Corvette's base price is close to double Camaro's base price, it seems appropriate to me that its upscale interior option would scale similarly. Obviously it wouldn't be the luxo-leather interior of the Corvette.

FWIW I think 250 million is on the high side to develop an optional interior. I'm not even talking about the whole interior -- just the dash, center stack, and console. Maybe the door skins too.

Fenster
01-09-2008, 11:52 AM
Quoted for emphasis. It's not about the number! It's just a way to show that it would be amortized against a lot of cars over a long period of time. The actual number had essentially nothing to do with the point! :)

And, again, you guys SUCK at playing "what if". :p

Again quoted for emphasis... ;)

It is not spread out over as long as you think it would be. "It's just a way to show that it would be amortized against a lot of cars over a long period of time" is completely incorrect. The costs would only be spread out over a 2-4 year period. Companies need to make the investment money back in the first 2-3 years for the most part so they can use the last year or so of the vehicle models to make any money. For example, the auto manufacturer that I am a product planner for strives to have all investment (return on investment as its termed) repaid in 2 years from model launch.

As far as vehicle investment... I can guarentee that GM has and is going to spend at lease $1B to develop the Camaro, probably quite a bit more. Dodge spend almost $2B to develop the new Ram if that helps any... ;)

Chris 96 WS6
01-09-2008, 11:54 AM
Fine. New scenario. Here are my assumptions:
* it costs 250 million to develop, test, set up tooling for, etc, for a new interior

I am saying $250m for the WHOLE car, not the interior. Geeze that would be a really pricey interior.

Fenster
01-09-2008, 11:55 AM
Fine. New scenario. Here are my assumptions:
* it costs 250 million to develop, test, set up tooling for, etc, for a new interior
* Camaro moves 100k units/year.
* it goes four years without major changes to the interior.
* one of the interiors is considered to be "better" than the other and is sold as an extra-cost option
* the optional interior accounts for 35% of sales

Doing the math, the optional interior would need to cost at least $1786 per car.

That's a pretty pricey option, but it's not entirely unreasonable as an option. The nicer 4LT leather interior in the C6 is an extra $3540, which is almost exactly double my predicted cost. Since the Corvette's base price is close to double Camaro's base price, it seems appropriate to me that its upscale interior option would scale similarly. Obviously it wouldn't be the luxo-leather interior of the Corvette.

FWIW I think 250 million is on the high side to develop an optional interior. I'm not even talking about the whole interior -- just the dash, center stack, and console. Maybe the door skins too.

Remember that the interior you refer to on a C6 is also a different intended buyer than a Camaro. Those guys don't flinch at buying a car that STARTS at $50k. Things that you can do and sell on such a vehicle are much different than a car w/ a starting price around $20k.

Fenster
01-09-2008, 11:56 AM
I am saying $250m for the WHOLE car, not the interior. Geeze that would be a really pricey interior.

Actually that's probably not too far off. A good friend of mine that works w/ me now, that used to be at Chrysler said they averaged about $1B for each new car developed. That's is assuming an all new car though... not for minor changes etc.

JakeRobb
01-09-2008, 12:08 PM
I am saying $250m for the WHOLE car, not the interior. Geeze that would be a really pricey interior.

I don't think it's all that far off. If a complete vehicle costs $1-2b to develop from concept to production, why wouldn't the complete interior take up at least a quarter of that?

Especially in a system where powertrain development is shared across a large selection of vehicles, and the powertrain platform is already fairly mature. My guess is that relatively little Camaro-specific powertrain development is required. I know it's more complex than this, but they can basically toss in an LS3 and a TR6060/6L80 and they're good to go. They most likely have to develop things from the transmission on back (driveshaft, rear end, axles, etc), but taking the engine/trans out of the equation probably helps a LOT.

Remember that the interior you refer to on a C6 is also a different intended buyer than a Camaro. Those guys don't flinch at buying a car that STARTS at $50k. Things that you can do and sell on such a vehicle are much different than a car w/ a starting price around $20k.

If a $3500 interior is appropriate for someone who's willing to buy a $50,000 car, why isn't a $1750 interior appropriate for someone who's willing to buy a $25,000 car?

Fenster
01-09-2008, 12:11 PM
If a $3500 interior is appropriate for someone who's willing to buy a $50,000 car, why isn't a $1750 interior appropriate for someone who's willing to buy a $25,000 car?

B/c an interior costing $1750 to DEVELOP plus piece costs etc. would be more like a $2000 COST interior. They would never sell it for COST. What's the point of the development. There would be additional mark up on top of that so the company can make money on the option package, and thus you end up w/ a $2500 or so interior...

JakeRobb
01-09-2008, 12:17 PM
B/c an interior costing $1750 to DEVELOP plus piece costs etc. would be more like a $2000 COST interior. They would never sell it for COST. What's the point of the development. There would be additional mark up on top of that so the company can make money on the option package, and thus you end up w/ a $2500 or so interior...

As long as it's an option (and as long as the interior is nice enough to justify the price), I still don't think that $2500 is entirely out of the question.

Fenster
01-09-2008, 12:22 PM
As long as it's an option (and as long as the interior is nice enough to justify the price), I still don't think that $2500 is entirely out of the question.

You are correct that it is not out of the question, but you have to be able to justify and quantify the amount of people that would actually opt for this 2nd interior that you speak of, b/c the volume produced (or that is opted w/ the expensive 2nd interior) would affect the price of the package due to piece costs. The higher the volume the less the costs and thus less price, or the less the volume the higher the cost and price. That type of RISK is something that would never be accepted. There is too much possibility of missing the volume actually sold. If GM predicts a certain volume or pen rate, and ends up selling significantly less, they lose a good bit of money on that option package. Not a good thing. ;) Once a price is set for the package its set.

That number would have to be at least 50/50 for your theory to work, something that would be almost impossible to get w/ a price of $2500 to add this optional interior.

The only other choice would be to have the customer choose the interior when building the car, but that would raise the base price of the vehicle up on BOTH interior models. Something that would not be a good thing for sales on a car w/ a base price where the Camaro is it, in a very competitive niche market.

Rampant
01-09-2008, 12:35 PM
Fine. New scenario. Here are my assumptions:
* it costs 250 million to develop, test, set up tooling for, etc, for a new interior
* Camaro moves 100k units/year.
* it goes four years without major changes to the interior.
* one of the interiors is considered to be "better" than the other and is sold as an extra-cost option
* the optional interior accounts for 35% of sales


Continuing on this train of thought, you have to do some sales analysis.

Let's say it costs $2k to make (round number for ease), and GM would sell it for $3k to make it worth it (again, round number). You then have to try to guess how many people would pay $3k for a new interior option.

If 60% of the 100k buyers are V6, you are looking at a $20k car. How many would spend an extra 15% just to get a different looking interior (that, theoretically isn't any better from a materials standpoint)? I would think that number couldn't get over 5% of the buyers (remember, design is subjective, and many would buy the V6 because it is cheap, and $3k would get them close to the V8 and/or at least well out of Mustang V6 pricing).

So, that is 3,000 V6 buyers.

Now, we have 40k V8 sold. There, the $3k interior is roughly 10% the price of the car. And, for arguments sake, let's say 15% will opt for it (again, cost is a huge issue, but at least there is a much higher percentage who might be willing to pay the extra for it).

So, that is 6,000 V8 buyers.

Combined (using this formula) 9,000 buyers choose the $3,000 interior option. Total money to GM = $27m per 100k vehicles sold.

Even if V8 buyers spike to 35%, that is still $51m in total revenue to GM.

A far cry from the $250m we are estimating it will take to produce the option.

To get that money back within two years, GM would have to average roughly 41.7% of 100k buyers, paying $3k for the other interior option. That, I just can not see happening -- especially considering how price-conscious everyone here (the enthusiasts who will pay extra for stuff we want) is.

Granted, everything we are theorizing here is just numbers we are pulling out of a hat (with very minimal support), but it shows there is a lot more that goes into this than we, on this board, can dream up with a simple formula.

Playing "what if" is fun -- but we have to think about all the factors involved if we are going to do it correctly.

Geoff Chadwick
01-09-2008, 12:40 PM
I just threw out the million dollar number cause I was confused with the math used. Thats all... Now I realize that it would actually cost a LOT more than that, and this is a situation about the numbers, where GM cant play chance like they could with the new trucks. We're talking a very expensive option on a limited number of cars, but it still doesnt mean its not possible.

The problem I see with it is that either you install everything new on the assembly line, or you do it at the dealership - which is a lot of hourly labor to eat up to swap that much stuff. Throwing a number out there, like 10 hours lets say, to swap out parts. Thats probably $700 that gets passed to the consumer. GM cant just send the old dash back to the factory either. Whats going to get done with it? Perhaps this is more akin to something from GMPP that would be dealer installed for silly amounts of money?

90 Z28SS
01-09-2008, 04:59 PM
I'd only like to add that the number thrown out of $1m to design an interior is probably low at least by a factor of 10.

Very low , hehe . 1 example of just how much things cost . 2005-current Mustang overdrive button on the shifter . We have 3 separate molds and over a $50K just in tooling , thats not including the wires , terminal , circuitry and labor to produce the single switch assembly from start to finish . And thats just a basic switch with no silkscreening or backlighting .