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And yet automakers think that the smaller more affordable cars that do well overseas somehow have no audience in the US. For instance, the Geome Xingyuan is $1

And yet automakers think that the smaller more affordable cars that do well overseas somehow have no audience in the US. For instance, the Geome Xingyuan is $10k, Hongguang Mini EV is $5k. Instead we have the average cost of a new car at $50k.

decimalenough 1y ago
If they sold well in the US, they would bring in more of them. But they don't.
- eightysixfour 1y ago
  This is the argument everyone was making for small trucks until Ford brought in the Maverick and demand was so high they couldn't keep them on lots. When they bring is right sized vehicles thay don't suck, we but them.
- kristopolous 1y ago
  In the 1970s Detroit thought the Honda Civic was a joke as well. How could it ever compete against the Pontiac Astre or the Buick Skyhawk they thought...
  - potato3732842 1y ago
    It couldn't compete. Those cars were shit, just like the Chevettes they were competing against. It was all shit. All of it. The imports were typically slightly more expensive to boot. They sold well because you could get a Civic or whatever with a nice radio and they had a bunch of them on the lot in automatic and all the other things buyers cared about beyond just A to B because for the Japanese automakers shit was serious business and so they built their shit with some give-a-fucks included whereas to the Americans shit was a sideshow and they phoned it in and it was like pulling teeth to get a well optioned domestic that wasn't hobbled by the lack of some key feature or ergonomics issue. None of these were cars people wanted to be driving. The market for big nice fuel hogs shrunk and the market for compacts rose in it's place and the Japanese were very well positioned to put their ass in that seat when the music stopped.
    - kristopolous 1y ago
      That's not the point. It was that the market hypothesis of supply simply responding to demand doesn't actually hold. People sell things based on their perception of future consumer sentiments, calculated margins, defensible moats, lots of things. If someone wanted a compact sedan but the only thing for sale was SUVs, they aren't going to be like "I refuse! Bus pass for me" no. They will just bite the bullet and purchase the SUV. Then the analysis will say "well people are buying the SUV! It looks very popular we should make more of them! I told you sedans were a bad idea!" The supply and demand economics 101 ways of thinking are for fools and simpletons. It's why the iPhone wasn't a BlackBerry knockoff
      - decimalenough 1y ago
        SUVS (and enormous trucks) are popular, but they are not "the only thing for sale". Alternatives do exist, they just not very, you know, popular.
        kristopolous 1y ago
        Kind of. For a number of complex reasons SUVs are cheaper than sedans. I know with more stuff you think that would be more cost but things are complicated. I mean look at Hyundai's ev line up. I drive a kona because it's the cheapest. The next most expensive car is the 5 and then their most expensive (up until recently) was also their smallest! The 6. It's like twice the price and at the end of the day I just wanted to drive electric so I got the cheaper one. But if the ioniq 2 had a US release I'd be on top of that real quick
      - cudgy 1y ago
        Reminds me of the fashion industry … and manufactured consent
- danans 1y ago
  > If they sold well in the US, they would bring in more of them. But they don't. The auto industry would rather use its limited assembly line capacity for the highest margin products, which are large luxury internal combustion vehicles. We have long been in the era of lean manufacturing, where assets like factories are hyper-optimized for returns to capital, not for making products to serve all needs or desires. Why lower your gross margins by investing in more factory capacity to make affordable cars? You'd rather put your capital into the Mag-7 to get a higher rate of return. It also makes sense because with growing inequality in the US, the well-off (or the financially irresponsible) are the only people who buy new cars anyways, so the manufacturers make cars for them. This is also a big part of the reason they make EVs (which are disproportionately higher end or luxury): because they know that EV buyers are likely to be more well off. The environmental benefits are secondary, and the auto industry has never cared much about lowering TCO or energy costs (those things benefit the EV driver, not the car manufacturer).
  - potato3732842 1y ago
    The Toyota fanboy mob will be along shortly to downvote you for saying bad things about our lord and savior lean manufacturing. (joking, but not as much as I want to be)
    - maxerickson 1y ago
      Is it hard to get a Corolla?
    - danans 1y ago
      > saying bad things about our lord and savior lean manufacturing. I'm not saying it's good or bad, it just is, and car companies don't exist to make affordable new products for everyone. "Obese" manufacturing won't result in more affordable cars either, not while housing, education and healthcare continue to eat away at Americans' stagnant income growth. If affordable transportation is the goal, we probably need to get past personal car ownership.
    - taneq 1y ago
      People talking about lean manufacturing never seem to mention the outsourced risk involved. That ‘wasted’ inventory that you have laying around is actually insurance against supply chain shocks. And outsourcing manufacturing of critical components creates uncontrolled existential risks for your business.
- cr125rider 1y ago
  No, the big 3 can’t compete. Thats why Chinese cars are straight banned here. Not because of economics
- decimalenough 1y ago
  Ok, this comment obviously touched a nerve, but as a non-USian I don't quite understand why. You can pick up a new Kia Forte for $20k. I was about to suggest the even smaller Kia Soul, but it was discontinued because, drum roll, it didn't sell well enough.
2OEH8eoCRo0 1y ago
The Dacia Sandero!
JumpCrisscross 1y ago
> yet, automakers think that the smaller more affordable cars that do well overseas somehow have no audience in the US Blame fleet efficiency standards [1] and the light-truck loophole [2]. [1] https://me.engin.umich.edu/news-events/news/cafe-standards-could-mean-bigger-cars-not-smaller-ones/ https://me.engin.umich.edu/news-events/news/cafe-standards-c... [2] https://digitalcommons.law.lsu.edu/cgi/viewcontent.cgi?article=1332&context=jelr https://digitalcommons.law.lsu.edu/cgi/viewcontent.cgi?artic...
- Cytobit 1y ago
  If the automakers didn't like that stuff, they could lobby against it. They don't want to sell cheap autos.
ajsnigrutin 1y ago
https://www.reddit.com/r/electricvehicles/comments/1ehfe04/vw_is_selling_id3_in_china_for_15k_with_better/ https://www.reddit.com/r/electricvehicles/comments/1ehfe04/v... Many things are more affordable overseas.... aVW ID.3 is 15k eur in china, 32k over here in my small eu country.
username223 1y ago
On the one hand, I don't understand: a reliable EV costing only a few months of the median US income would be world-changing. On the other hand, I do: high-margin EVs like the Cybertruck are an easier way for car companies to make money in the next quarter. Why would you ever sell a vehicle that the people building it could afford, when the margins are so low?
somerandomqaguy 1y ago
The wealthy are buying larger more expensive vehicles. The poorer are either holding onto their existing cars (the average age of an American car went up from 11 years to 12 years or so) or buying the used larger ones from the wealthy.

decimalenough 1y ago

If they sold well in the US, they would bring in more of them. But they don't.

eightysixfour 1y ago
This is the argument everyone was making for small trucks until Ford brought in the Maverick and demand was so high they couldn't keep them on lots. When they bring is right sized vehicles thay don't suck, we but them.
kristopolous 1y ago
In the 1970s Detroit thought the Honda Civic was a joke as well. How could it ever compete against the Pontiac Astre or the Buick Skyhawk they thought...
- potato3732842 1y ago
  It couldn't compete. Those cars were shit, just like the Chevettes they were competing against. It was all shit. All of it. The imports were typically slightly more expensive to boot. They sold well because you could get a Civic or whatever with a nice radio and they had a bunch of them on the lot in automatic and all the other things buyers cared about beyond just A to B because for the Japanese automakers shit was serious business and so they built their shit with some give-a-fucks included whereas to the Americans shit was a sideshow and they phoned it in and it was like pulling teeth to get a well optioned domestic that wasn't hobbled by the lack of some key feature or ergonomics issue. None of these were cars people wanted to be driving. The market for big nice fuel hogs shrunk and the market for compacts rose in it's place and the Japanese were very well positioned to put their ass in that seat when the music stopped.
  - kristopolous 1y ago
    That's not the point. It was that the market hypothesis of supply simply responding to demand doesn't actually hold. People sell things based on their perception of future consumer sentiments, calculated margins, defensible moats, lots of things. If someone wanted a compact sedan but the only thing for sale was SUVs, they aren't going to be like "I refuse! Bus pass for me" no. They will just bite the bullet and purchase the SUV. Then the analysis will say "well people are buying the SUV! It looks very popular we should make more of them! I told you sedans were a bad idea!" The supply and demand economics 101 ways of thinking are for fools and simpletons. It's why the iPhone wasn't a BlackBerry knockoff
    - decimalenough 1y ago
      SUVS (and enormous trucks) are popular, but they are not "the only thing for sale". Alternatives do exist, they just not very, you know, popular.
      - kristopolous 1y ago
        Kind of. For a number of complex reasons SUVs are cheaper than sedans. I know with more stuff you think that would be more cost but things are complicated. I mean look at Hyundai's ev line up. I drive a kona because it's the cheapest. The next most expensive car is the 5 and then their most expensive (up until recently) was also their smallest! The 6. It's like twice the price and at the end of the day I just wanted to drive electric so I got the cheaper one. But if the ioniq 2 had a US release I'd be on top of that real quick
    - cudgy 1y ago
      Reminds me of the fashion industry … and manufactured consent
danans 1y ago
> If they sold well in the US, they would bring in more of them. But they don't. The auto industry would rather use its limited assembly line capacity for the highest margin products, which are large luxury internal combustion vehicles. We have long been in the era of lean manufacturing, where assets like factories are hyper-optimized for returns to capital, not for making products to serve all needs or desires. Why lower your gross margins by investing in more factory capacity to make affordable cars? You'd rather put your capital into the Mag-7 to get a higher rate of return. It also makes sense because with growing inequality in the US, the well-off (or the financially irresponsible) are the only people who buy new cars anyways, so the manufacturers make cars for them. This is also a big part of the reason they make EVs (which are disproportionately higher end or luxury): because they know that EV buyers are likely to be more well off. The environmental benefits are secondary, and the auto industry has never cared much about lowering TCO or energy costs (those things benefit the EV driver, not the car manufacturer).
- potato3732842 1y ago
  The Toyota fanboy mob will be along shortly to downvote you for saying bad things about our lord and savior lean manufacturing. (joking, but not as much as I want to be)
  - maxerickson 1y ago
    Is it hard to get a Corolla?
  - danans 1y ago
    > saying bad things about our lord and savior lean manufacturing. I'm not saying it's good or bad, it just is, and car companies don't exist to make affordable new products for everyone. "Obese" manufacturing won't result in more affordable cars either, not while housing, education and healthcare continue to eat away at Americans' stagnant income growth. If affordable transportation is the goal, we probably need to get past personal car ownership.
  - taneq 1y ago
    People talking about lean manufacturing never seem to mention the outsourced risk involved. That ‘wasted’ inventory that you have laying around is actually insurance against supply chain shocks. And outsourcing manufacturing of critical components creates uncontrolled existential risks for your business.
cr125rider 1y ago
No, the big 3 can’t compete. Thats why Chinese cars are straight banned here. Not because of economics
decimalenough 1y ago
Ok, this comment obviously touched a nerve, but as a non-USian I don't quite understand why. You can pick up a new Kia Forte for $20k. I was about to suggest the even smaller Kia Soul, but it was discontinued because, drum roll, it didn't sell well enough.

2OEH8eoCRo0 1y ago

The Dacia Sandero!

JumpCrisscross 1y ago

> yet, automakers think that the smaller more affordable cars that do well overseas somehow have no audience in the US Blame fleet efficiency standards [1] and the light-truck loophole [2]. [1] https://me.engin.umich.edu/news-events/news/cafe-standards-could-mean-bigger-cars-not-smaller-ones/ https://me.engin.umich.edu/news-events/news/cafe-standards-c... [2] https://digitalcommons.law.lsu.edu/cgi/viewcontent.cgi?article=1332&context=jelr https://digitalcommons.law.lsu.edu/cgi/viewcontent.cgi?artic...

Cytobit 1y ago
If the automakers didn't like that stuff, they could lobby against it. They don't want to sell cheap autos.

ajsnigrutin 1y ago

https://www.reddit.com/r/electricvehicles/comments/1ehfe04/vw_is_selling_id3_in_china_for_15k_with_better/ https://www.reddit.com/r/electricvehicles/comments/1ehfe04/v... Many things are more affordable overseas.... aVW ID.3 is 15k eur in china, 32k over here in my small eu country.

username223 1y ago

On the one hand, I don't understand: a reliable EV costing only a few months of the median US income would be world-changing. On the other hand, I do: high-margin EVs like the Cybertruck are an easier way for car companies to make money in the next quarter. Why would you ever sell a vehicle that the people building it could afford, when the margins are so low?

somerandomqaguy 1y ago

The wealthy are buying larger more expensive vehicles. The poorer are either holding onto their existing cars (the average age of an American car went up from 11 years to 12 years or so) or buying the used larger ones from the wealthy.