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R&T; income inequality killing sports cars


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7 hours ago, visionaut said:

Good article, Dave.  Can't disagree there's a 'hole', I've seen it...

 

Yeah, hit the front page of Reddit this morning...  It was well written.

 

Makes me want to start tracking down the young kids messing with their cars and give them a hand.

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Good article and the problem is even more acute for my peers. I graduated high school in  2004, I chose a trade but my peers who went to college graduated into the Great Recession in 2008 with student loans and competing for jobs against people with twenty years experience who were desperate. They’ve just started getting caught up in life only to be knocked down again by the Covid recession. Wealth inequality is a problem that will need to be addressed or the cycle of people who can’t afford to retire preventing the next generation from being promoted/increasing their own earning will continue. 

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I disagree.  While there is huge income inequality, the standard of living has increased so that our expectations are ridiculously high.  People are spending more on their cars than ever before.  When I was a kid, it was typical for a first car to be a run-down clunker.   More and more high schoolers are driving nice...and I mean really nice....cars.  

 

As someone that work in the car industry, we're losing sports cars for a totally different reason.  Capitalism.  Let me  explain.

So, by the basic rules of a publicly traded business, a company wants to make 10-20% more profit than that same day the previous year.  Investors are in it for the short-term, and they expect to see an increase in their pocketbook every year.  This isn't really sustainable, so this tends to be the  path for car companies (think of Ford right before their crash):

 

..remember, this is all driven by the mission "how do we make more money?"

 

1.  Make an awesome product

2.  Make more products to get more market share

3.  Sell more places (globally) to get even more market share

4.  Buy up competition to get more market share

 

...at this point, companies have saturated the market.  So the only way left to increase profit it to cut costs...

 

5. Start sharing platforms and other parts (for example, the Porsche Cayanne shared a door with the VW Toureg , and the Jeep Renegade is built on the Fiat 500 platform.  Most famously, the Pontiac Aztek was  built on GM's minivan platform...which is a major reason is was so hideous.  GM did that because they wanted to make more cars off the minivan platform - the more cars you make off a single platform, the sooner it pays itself off)

...this is where things start to go wrong for Sports Cars.  

Nothing shares a platform with performance cars.  You can't make a profitable sedan off a Corvette platform.  So the big head honchos don't want to invest in producing one. 

 

Exceptions are brands that are built off the idea of performance.  The Porsche 911 doesn't make the company any money (they actually lose money I believe), but they wouldn't be able to sell any of the other cars on their lineup without the 911.  No one dreams of a Panamera, but its what people actually buy.

 

In case you're curious, the last step:

6.  Reduce quality.  Make more stuff out of plastic instead of metal.  

 

...oops.  Didn't mean to write so much.  LOL

 

 

Edited by Laura
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Also, all the above being said...I'm also in that category they talk about.  I make a great living.  But between rent, astronomically high student loan payments, and even more ridiculous childcare costs....I don't see a new car in my future anytime soon. 

 

....that just isn't why they arent making Sports Cars.  

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