There is a fundamental truth you have to understand about car companies:They do not exist to make cars. They exist to make money. That distinction, analyst Kevin Tynan tells me, is why they’re not really interested in making affordable electric vehicles.

Perhaps that’s an oversimplification. Tynan is the director of research at an auto-dealer-focused investment bank, the Presidio Group, with decades of experience as an analyst at firms like Bloomberg Intelligence. What he means isn’t that automakers have no interest in affordable products. It’s that their interest begins and ends with winning customers who will eventually buy more expensive, higher-margin products.

One of the auto industry’s dirtiest secrets is that at scale, it doesn’t cost that much more to make a bigger, more expensive than a smaller and cheaper one. But they can charge you a lot more for the former, which makes this a game of profit margins and not just profits. In recent years especially, that’s a big part of why your new car choices have skewed so heavily toward bigger crossovers, SUVs and trucks.

  • helenslunch
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    28 days ago

    For electric cars yes.

    Doesn’t matter. The entire point of the article was that EVs can’t be made inexpensively because there’s not enough profit in inexpensive vehicles. I brought up the vehicles I did because it disproves that theory.

    are these costs truly matching inflation?

    Probably not. Still nothing to do with EVs.

    Many parts do the exact same stuff they used to.

    That doesn’t mean they’re the same part.

    A radio head unit nowadays is the same head unit 3 and 5 years ago in a new shell

    No.