A Local Car Dealership, A Dead Battery, A Volt and Strategy

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I've had trouble with my car not starting for years. It's been entirely irregular. One time I had driven it to the Sears auto garage and parked it, but when the mechanics went to move it they couldn't start it. I got in, turned the key and it started. They thought I had some kind of trick.

Well, yesterday it wouldn't start (yet again). I waited and tried over & over, but no go. So, I relented, called AAA and had it towed to the local Chevy dealership. If they couldn't fix a Chevy then who could.

While I was there I looked at a Volt and talked to one of their salesmen about various vehicles. I found they sold a giant truck for about $68,000, but had only sold ONE Volt for about $42,000 (with $15,000 gov't rebate). Why I wondered?

So, on to the garage I went and got my car. They had to change the battery (oh the irony of the Volt full of batteries going unused and my batter being the one that died). I wonder if replacing the battery will really solve all the problems. But, naturally the first thing I noticed was the gigantic bill. Why should it cost so much to change a battery?

The next day I had an epiphany: the cost of maintenance is a profit center for the dealerships and if they sell you a car that doesn't break down (an electric car), then there's no profit by fixing it. This explains a lot about why they had only sold one Volt, and that to an electric company executive!

In other words, car companies in America don't get paid for selling you a great quality car that won't break down, but for selling stuff scheduled to fall apart so you have to get it fixed -- an electric car doesn't fit that mold.

The car companies which have invested billions in building internal combustion engine cars and in garages to fix them can't afford to change to electric cars (at least not quickly). This means the best way forward is for foreign makers or new companies to do it. Of course, they would receive tremendous competition from existing companies who don't want to lose business. Then, of course, they will have brought it on themselves by making the repair business a profit center instead of a dead cost.

Strategy comes into the picture when you want to devise something new which can succeed. Where are your profits and costs and how can a customer base afford it. The existing car companies spread it out by charging less up front and repair payments along the way. What can electric car companies do to spread the costs or just make them so low the existing companies get blown away?

It's easy to make small changes here and there and never quite get anywhere. What is the big picture which will succeed and how can you get to it without falling apart? You can't have a  end product, but no way to get there and hope it will all work out. This is one reason I believe hybrids are the way to go. An existing company can build a hybrid with the internal combustion engine and transition to the all-electric (or perhaps bio-diesel with battery hybrid) without changing every single thing about their company and without having to compete against existing companies which have already sunk costs in infrastructure.

A new American car company which doesn't profit from repairs would be an amazing thing.