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Alternative Fuels, Hybrid Cars, Fuel Efficiency (MPG), Truck, Sedan, SUV
#129 of 178 Re: No car company puts all their eggs into one basket [larsb]
Mar 03, 2005 (1:19 pm)
They (broken record) are building them now as FAST AS THEY CAN.
Yes, you have said that many, many times. I don't believe it for a minute. You can put your trust in a company like Toyota. They did not make 12 billion in profit by wasting money building hybrids that have a very small return on investment. They are making the money on PU trucks, that is why they can build a new factory in one year to double their production.
#130 of 178 Thats because they ARE building them as fast as they can...
Mar 03, 2005 (1:28 pm)
The waiting list for Priuses has gone from 4-9 months down to 4-6 weeks. This indicates a "faster moving supply chain:
Waiting lists are BAD for business - not good. Why would Toyota risk ALL those lost sales by intentionally making Priuses slower...Makes no sense.....
Toyota expands advertising campaign for Priuses - (hmmm, wonder why they would do that when they really (wink wink) dont want to sell them?):
Toyota expands Euro allotment of Priuses (hmm, still trying to sell them?):
Toyota "expanding production" of the Prius:
Prius sales in Feb 2005 DOUBLE the Feb 2004 number:
Toyota Prius European Car of the Year 2005 (oh NO says Toyota - now we have to SELL THEM in Europe TOO??????):
There's more where that came from. Does NOT look like a company trying to AVOID INCREASING Prius sales, does it?
If this were a real debate, the moderator would ask me to sit down now and end the proceedings. There is not doubt that Toyota is
A) actively advertising and trying to sell the Prius
B) meeting the demand with additional production
#131 of 178 Re: Thats because they ARE building them as fast as they can... [larsb]
Mar 03, 2005 (2:07 pm)
you: Waiting lists are BAD for business - not good. Why would Toyota risk ALL those lost sales by intentionally making Priuses slower...Makes no sense.....
me: you should research then what a "loss leader" is and why they are used. Examples:
A super market will sell eggs this week at $0.50/dozen, to get you in the store. In this case to buy addition items.
A store may sell computers for $199, but limit it to 10. But they get a few hundred people come in to see if they can get one (many people miss the fine print of that 10-limit.
And an auto dealer may advertise 1 base-model car at a loss, sell it for a loss, but switch everybody else who comes in for that car to the other 20 loaded models they have on the lot.
I would not find it surprising that Toyota enjoys having people come in to inquire about the Prius, find out it's 4-6 week wait, and offer them a Corolla or Camry instead. A lot of people who car shop want a car in the next few days or week, and don't want to wait a month+.
I know of 1 mothballed GM plant in Framingham, MA. There are probably others around the country. If Toyota's making money, and they should be making a lot of money on the Prius selling it at MSRP, then they should be able to buy a few of these closed plants and start rolling hybrids off them.
But here's another thought. Maybe Toyota is telling the truth about making a profit on the Prius? But if that profit is small that would not be enough to justify a new plant. If Toyota's making $100/Prius that doesn't justify putting out $100M or so for a plant, or to pull production from Camry's which might make $500/car.
That is a possible scenario. If you're going to build a plant, you're going to decide to build the most profitable vehicles - highest return on investment.
Most companies look for at least 8% return on their investments. That means if a plant costs $100 million to buid, + so much to operate, it still needs to generate $8M in profit. Otherwise the company would have been better off investing in bonds. So the Prius could make money, just not enough.
#132 of 178 I completely understand what a "loss leader" is and how they work
Mar 03, 2005 (2:09 pm)
It just does not apply to the Prius. Simply doesn't.
#133 of 178 Re: Thats because they ARE building them as fast as they can... [kernick]
Mar 03, 2005 (2:42 pm)
"I know of 1 mothballed GM plant in Framingham, MA. There are probably others around the country. If Toyota's making money, and they should be making a lot of money on the Prius selling it at MSRP, then they should be able to buy a few of these closed plants and start rolling hybrids off them."
Is that a state-of-the-art plant? It might cost more to update it than it would to build a new, modern plant.
#134 of 178 Re: Thats because they ARE building them as fast as they can... [kernick]
Mar 03, 2005 (4:03 pm)
I would not find it surprising that Toyota enjoys having people come in to inquire about the Prius,
I think we are beating our heads against a brick wall. There is a very small minority of people in this country that are disillusioned about the hybrid technology. They have it in their minds that it is going to save this planet. They are even further mislead by companies like Toyota thinking that they share in this utopian dream.
If Toyota was serious about building a new facility for hybrids, to meet the demand they could have taken the very generous offer that Ahnold flew to Japan and presented to them. All they have said is we are going to increase production of the Prius and we may build a factory in China to do that. Maybe if we can squeeze enough Yen out of the bank to proceed.
"This year our target is to more than double to 20,000 hybrid vehicle sales in Europe,"
I'll bet they would love to sell their whole production of hybrids in the EU if they could. With the RX400h selling for 56k Euros before taxes they would make a killing. People in Europe want real economy and will continue to buy diesel cars.
#135 of 178 How are you positive?
Mar 03, 2005 (5:17 pm)
Since you or I have no way to tell the absolute truth, it is illogical to eliminate all possibilities. You only weaken any argument you have, by failing to consider any possibility you don't like.
I'm sure there were many people who thought Enron was a great, ethical company, and that they were going to have a great pension. Your fooling yourself if you think somehow Toyota and Honda has all brilliant, saints working for them and the Big 3 has all stupid, devils.
If you want us to believe your theory, then explain why a company with billions in cash, can't meet demand for Priuses when it was known last year. You refuse to address how car companies such as Ford managed to increase production on a model by 0.5 million in little over a year. 40 years later and with the supposed efficiencies of Toyota and they can't do that or better?
#136 of 178 Re: How are you positive? [kernick]
Mar 03, 2005 (5:59 pm)
(a) they make profit on their other models too, so it's not a smart move to curtail production of those in order to make more Priuses.
(b) Prius is still a unique model with unique components. Ramping up production of Prius is dependent on ramping up all of those things (batteries and electronics, hybrid transaxles, body components, etc). OTOH, the Five Hundred and the Freestyle (?) share a common platform, so when Ford found that they were selling more Freestyles than Five Hundreds, there was not as big an effort required to shift production. Once more models use the same set of components as Prius it will be much easier to balance production of the various hybrid models to meet demand.
(c) Toyota has been ramping production. If as you say the point of the Prius is to draw people into the dealership then sell them something else, why not just keep production where it was?
This theory also assumes someone looking at Prius would be amenable to some other model of Toyota. I don't think that's a credible assumption.
#137 of 178 HAS EVERY BODY NOTICED TOYOTA HYBRID ADS ARE ALL OVER TV NOW
Mar 03, 2005 (8:44 pm)
Ads running rampent on TV now. They must be gearing up to sell alot of PRIUSES because the ads are now everywhere. I can only imagine that this saturation of advertising means that they will be delivering more and more cars to meet the demand. Eat your Gas Guzzlers "BIG THREE"
Culliganman (free us Prius)
#138 of 178 Re: How are you positive? [stevewa]
Mar 04, 2005 (10:26 am)
First - Thank you for making some points to discuss, rather than just saying "it isn't so because it's Toyota or Honda".
a) Yes as I mentioned before, with current production facilities, a company will produce those models which make them more profit. If a Tundra makes $1,000 profit, a Camry $500, and a Prius $250, you don't switch either from Camry or Tundra to Prius. The same would hold true on expansion plans; a company would decide to increase whatever models were the most profitable first. You'd increase all if there is demand but the most profitable get the attention (new Tundra plant?)
b) Yes, but Toyota has been famous for Lean Mfg. and Kaizen techniques, that make production lines simple and expandable. There is no reason if you have 2 battery lines and 2 transaxle lines, why they could not be replicated by a factor of 5 or 10 - within a year. Surely Toyota has the cash to do so.
Ford and Mercury. A better analogy would be overall demand for them since they are the same car. If these vehicles were a big hit, such that Ford could sell 3X as many, I bet by next year Ford would be producing that.
c) For marketshare; to raise their CAFE number, and if they are making a small profit; it is better to make $100/car than $0. And I guess the more they make the more they can spreadout their R&D costs.
you: This theory also assumes someone looking at Prius would be amenable to some other model of Toyota. I don't think that's a credible assumption
me: Why? I would think that people are buying Prius's foremost for fuel economy. If they don't get a Prius what are other high mileage decent size cars - the Corolla is tops in mpg in its class, and the Camry is not bad either. It's more likely they would shop there then go over to a Chrysler dealer which doesn't have any high mpg cars, or look at a Ford Focus.