A Corvette Z06 order at $90,000 over sticker

Here’s a new car being sold for $90,000 over sticker. In other words, the dealer gets $100,000 in profit while General Motors accepts perhaps $15,000 in profit.

I still can’t figure out Why aren’t cars (and pinball machines) auctioned as they come out of the factory?

At least the above consumer who signed the deal accepted that vehicle prices are dynamic. Why keep pretending that they’re not?

Separately, who else would love to have a Z06 for trips to Publix?


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Rivian now has dog mode

A company whose stock value I have questioned (see What edge does Rivian have in the truck or EV market? (11/16/2021; market cap $127 billion) and How is Rivian still worth $78 billion? (1/6/2022); market cap recently closer to $30 billion) now has the feature that I begged for in 2003: dog mode.

“Rivian Just Added a Pet Comfort Mode” (MotorBiscuit):

Rivian has addressed this by creating a pet comfort mode that will maintain a temperature between 68 and 74 degrees Fahrenheit in the car while you are away. All you need to do to turn it on is hit the paw icon in the upper right corner of the climate control screen. This will stay on while you’re taking care of business away from the vehicle. If you don’t set a specific temperature, it will automatically set to 72 degrees Fahrenheit.

The Rivian addresses this by alerting anyone who passes by that the pet comfort mode is on and your dog is OK.

The companies that could easily do this with a bit of programming, e.g., Ford, GM, Toyota, Hyundai/Kia, Mercedes, BMW et al., apparently can’t be bothered. Only the startups (Tesla, Rivian, and maybe Lucid (according to a salesperson I talked to in a San Diego mall in June 2022)) provide this.

In other car news, a dealer here in South Florida had a new C8 Corvette in stock(!). With the Z51 (but not Z06!) performance package, convertible body, 3LT trim, and 75th anniversary color scheme, the machine carries an MSRP of $108,000. They expressed a willingness to sell it for $138,000, which includes a $30,000 “market value adjustment.” The high-end used car lot at the northeast end of Jupiter says that C8 Corvettes in yellow are the easiest to sell and that, within a day or two of being parked within sight of the road, are gone.


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Europeans implement my dream life-year saving system

March 2020… Why do we care about COVID-19 deaths more than driving-related deaths?: I point out that we aren’t doing anything about motor vehicle fatalities that are comparable in scale to the feared-at-the-time COVID deaths. I failed to adjust for life-years in this piece, so didn’t capture that fact that motor vehicle accidents have a far higher cost than the COVID-19 epidemic that led us to shut down schools, lock down businesses (except for “essential” marijuana in California and Massachusetts), etc. “We’re willing to invest $trillions to reduce the death toll from coronaplague, but hardly a dime to build centerline dividers on more of our two-lane roads so as to eliminate head-on collisions.”

February 2021… Save lives by limiting cars to 35 mph?: … by shutting down for a year we’ve spent way more per life-year in our attempt to reduce coronaplague deaths than I ever could have imagined. If we infer from this how much saving a life-year is worth to us, it would be rational to limit cars and tracks, nearly all of which are electronically controlled, to 35 mph. Consider that most people who die in car accidents had many decades of life expectancy in front of them, unlike the typical 82-year-old victim of COVID-19. … How about insisting that engine control software be updated in order to get an inspection sticker? The update will prevent the car from exceeding 35 mph. New cars, obviously, can be limited via regulation.

It looks as though the lockdown-loving Europeans agree with me, at least to some extent. They’re not willing to put anywhere near as high a price on a life-year lost due to a car accident compared to a life-year lost to COVID-19, but they are going to at least take the basic steps.

“Anti-Speeding Tech Is Now Mandatory in European Union” (Autoweek, July 7):

Mandatory on all new cars sold by 2024, the switchable ISA technology is expected to reduce speeding by 30% and traffic deaths by 20%.

Haptic feedback requires the car to recognize speed signs and, if the driver is in fact speeding, automatically push back against the driver’s accelerator pedal pressure. The speed control function goes one step further by cutting power input from the pedal once the speed limit is reached.

At least in the early years of these systems going in, the driver will have the ability to override the electronically enforced speed limit. Should we take bets on how soon before a public health emergency is declared and the electronic limit because a hard limit?

Here’s a great place for a computer-enforced speed limit, Lion Country Safari:

Speed limit 5 mph and the kids in the back would scream “speeder, speeder!” if the Honda Odyssey’s instruments indicated 6 mph or faster.

A daily-driver Ferrari at the local office park:

You can’t spit in a strip mall parking lot in South Florida without hitting a car that would end up with 400 excess horsepower in the event that this kind of regulation is adopted in the U.S.

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Why aren’t cars (and pinball machines) auctioned as they come out of the factory?

I was in an Uber the other day here in Palm Beach County. It was a Kia Sorento, a small SUV that supposedly costs $30,885 new. The driver had recently purchased it, a 2019 model, for $28,000. It had 125,000 on the odometer when he agreed to pay $28,000.

Plainly a new Sorento, uninspiring as it seemed to me, is worth a lot more than $30,885 retail. Thus, it amazes me that Kia will keep selling these to dealers for the invoice price. Why not auction each vehicle as it is about to go into production (for buyers who want to choose colors and options) or as it comes out of the factory? That would enable the manufacturer to capture most of the profits that dealers are currently getting and it would even work better in a downturn. Instead of having to work overtime with incentive programs and rebates, the manufacturers would just naturally get less for each car in a recession.

A friend found a Toyota dealer agreement on sec.gov. It says “To buy and resell the Toyota Products identified in the Toyota Product Addendum hereto which may be periodically revised by IMPORTER” is a right granted to the dealer, but nothing about whether every 2022 Camry must be sold at the same price.

When information was being distributed on paper and auctions could be conducted only in person, maybe the fixed invoice/retail pricing system made sense. But why does it make sense now given that the cost of running an auction is a few dollars per item at most?

Nearly every house that is sold is subject to an auction, effectively, right? If it makes sense for houses, why not for cars? Art and decorative objects are auctioned by Sotheby’s. If it makes sense for a Barye at $1,260, why not for a car at $20,000+?

The same logic can be applied to almost anything that costs more than $100. The limited edition version of the Godzilla pinball machine was instantly sold out at $10,500. Stern left a huge amount of profit on the table (some people turned around and re-sold their machines for $15,000 or more) and plenty of potential buyers who would have been happy to pay more were disappointed. Why did it ever make sense to have a list price for this item? Same question for the $9,000 “premium” version of the game, which has a multi-month waiting list.

Let’s look at watches. A used in-production Rolex is worth $44,500, but Rolex sells it to dealers for the retail price of $12,400 minus the wholesale-retail discount. If we assume that a new Rolex Daytona is worth at least as much as a used Rolex Daytona, Rolex is giving up roughly $30,000 of profit on every sale. From Bloomberg, the jewelry store that PPP built:

If the answer is “consumers expect fixed prices and to consider a purchase for a few months before making a final decision,” coronapanic can be the excuse for a switch to an economically rational system in which everything reasonably valuable is auctioned, if not to the final consumer then at least to the retailer (who can adjust his/her/zir/their price accordingly).

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Kia EV6 is great for everything except transportation (WSJ)

Readers may recall Tesla Road Trip, in which we spent 10.5 hours on a 7.3-hour drive while saving our beloved Mother Earth.

“I Rented an Electric Car for a Four-Day Road Trip. I Spent More Time Charging It Than I Did Sleeping.” describes a reporter’s attempt to drive from New Orleans to Chicago and back in a Kia EV6, a seemingly great car except for the lack of dog mode.

Given our battery range of up to 310 miles, I plotted a meticulous route, splitting our days into four chunks of roughly 7½-hours each. We’d need to charge once or twice each day and plug in near our hotel overnight.

Over four days, we spent $175 on charging. We estimated the equivalent cost for gas in a Kia Forte would have been $275, based on the AAA average national gas price for May 19. That $100 savings cost us many hours in waiting time.

The car lost range faster than planned and charged slower than advertised:

But when we tick down 15% over 35 miles? Disconcerting. And the estimated charging time after plugging in? Even more so. This “quick charge” should take 5 minutes, based on our calculations. So why does the dashboard tell us it will take an hour?

They encounter a charger that is supposed to deliver 350 kW and instead it delivers 20, but occasionally one does work.

In the parking lot of a Clarksville, Ind., Walmart, we barely have time for lunch, as the Electrify America charging station fills up our battery in about 25 minutes, as advertised.

The woman charging next to us describes a harrowing recent trip in her Volkswagen ID.4. Deborah Carrico, 65, had to be towed twice while driving between her Louisville, Ky., apartment and Boulder, Colo., where her daughter was getting married.

Load up that Kindle if you’re going to travel with an electric car:

As intense wind and rain whip around us, the car cautions, “Conditions have not been met” for its cruise-control system. Soon the battery starts bleeding life. What began as a 100-mile cushion between Chicago and our planned first stop in Effingham, Ill., has fallen to 30.

“If it gets down to 10, we’re stopping at a Level 2,” Mack says as she frantically searches PlugShare.

We feel defeated pulling into a Nissan Mazda dealership in Mattoon, Ill. “How long could it possibly take to charge the 30 miles we need to make it to the next fast station?” I wonder.

Three hours. It takes 3 hours.

Here’s a map of where they charged:

As part of my plan to be wrong about everything, I would have expected electric cars to become cheaper and more practical than gasoline-powered cars (so many moving parts!) within 10 years of the first practical car (let’s call that the Tesla S, introduced in 2012). Right now, however, they’re both more expensive and less practical (as you can infer from the fact that you almost never encounter an electric-powered Uber).

A reader comment on Toyota pits all of its engineering prowess against Tesla:

The biggest benefit of tesla isn’t even how it’s made, the price etc. It’s the supercharger network. Without anything resembling it (and there’s nothing else really) other manufacturers don’t make cars, they make toys.


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Bad news for Rivian: the electric Ford F-150 is at least pretty good

From November: What edge does Rivian have in the truck or EV market? (market cap: $127 billion)

From January: How is Rivian still worth $78 billion?

The market cap today is $18 billion, an 85 percent loss for those who bought the stock at the time of my November post (or a massive profit for those who went short!).

Today’s Car and Driver review of the F-150 Lightning:

Though this truck has many parlor tricks—a big frunk that can swallow 400 pounds, an optional tongue-weight scale, and BlueCruise hands-free driving—none are as impressive as how quick it builds speed from a standstill, thanks to 775 pound-feet of instant torque. Mat the accelerator and the front tires spin. Actually, the fronts will spin if you floor the accelerator at any speed below 50 mph or so. The effect is amplified as you load the truck closer to its 2235-pound max payload capacity.

It even drives and feels a lot like an F-150. A 50/50 weight balance contributes to very good road manners. … A low center of gravity keeps the truck relatively flat through corners, too.

The base vinyl-lined Pro model starts at $41,769 and comes with the 98.0-kWh battery that’s good for an EPA range of 230 miles, while the upgraded extended-range battery brings 131.0 kilowatts-hours of storage and 320 miles of range. … On the not-so-good front, the Lightning can tow up to 10,000 pounds when spec’d with the Max Trailer Tow package, but it can’t do so for very long between charges. We pulled an 8300-pound boat and trailer at about 65 mph, and the on-board trip computer indicated we were getting less than one mile per kilowatt-hour. This puts the highway range with a trailer of decent size and mass somewhere around 100 miles.

[A friend has a reservation for the F-150 Lightning and they won’t let him order the base model, so the $41.7k price is maybe just a theoretical one. The real price is at least $60k.]

So the Ford product is at least pretty good, is backed by a company from which people have been buying trucks for more than 100 years, and is much cheaper than what Rivian charges for a similar capability.

Ford even shows a great place to run out of battery power:

If this vehicle had dog mode, it would certainly be a better value than anything from Tesla!

Circling back to Rivian… after they run out of Silicon Valley enthusiasts, who is going to pay $100,000 for a non-Ford, non-GM, non-Toyota pickup truck? And what is the stock/company worth?

Rivian stock versus the S&P 500 starting on the date of my first post:

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Toyota pits all of its engineering prowess against Tesla

One of my enduring theories was that the electric car market would work like most of the markets described in Crossing the Chasm. The pioneering company selling to early adopters gets bypassed when the mainstream companies piled in and sell to mainstream customers who don’t care about the features that the early adopters were passionate about. So Tesla, with its limited engineering capabilities and manufacturing experience, would be leapfrogged by Toyota, Honda, Ford, et al. when it was time for the typical Toyota Camry or Honda Accord owner to buy an electric car.

“Tested: 2023 Toyota bZ4X Gets Toyota into the EV Game” (Car and Driver) proves that I’m wrong yet again. The car is neither significantly cheaper nor significantly better than a Tesla. With all of their marketing experience, Toyota couldn’t even come up with a decent name. Also note that the marketing materials imply that you need a $3 million house before you can think about purchasing (and that bZ4X drivers should adhere to an obsolete cisgender heterosexual nuclear family lifestyle).

Most egregious: no dog mode!

Can we conclude that the only human on Planet Earth capable of doing things in a reasonable way is Elon Musk?

(Like those announcing receiving an award on Facebook, I am humbled and honored that my prediction turned out to be dead wrong. Well, maybe not honored. Just humbled (but not humbled enough to stop making predictions, sadly).)

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Why is the markup on electricity for charging cars higher than the markup for gasoline?

Electrify America charges 43 cents/kWh in Florida:

That’s 4X the average price to a commercial customer in the state (EIA.gov; which shows that Electrify America’s price is 5X the “industrial” rate, which might be more appropriate for a large and busy charging station). (Let’s ignore the membership price of 3X because you can get a fair price at a gas station without joining any clubs.)

Retail gasoline is about 10 percent over cost (source), i.e., 1.1X.

The gas station needs to dig a tank, maintain pumps, insure against environmental calamity, fire, etc. The electric charging station just needs a few parking spots, some wires, and some high-power/high-voltage components.

For people who live in apartments and/or do most of their charging on trips, do these huge charging station markups eliminate the purported fuel cost savings for high-cost electric cars? (we almost never see a Tesla used as an Uber, right?)

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12 Hours of Sebring, a perfect Florida fly-in destination

Since small aircraft are generally inferior to a 2009 Honda Accord as a transportation tool, it is worth celebrating the situations in which it make sense to fly. The Sebring, Florida race track is actually built on part of what was once a vast military airport and is now a medium-sized civilian airport. Therefore, if you are landing on Runway 1 you’ll see the race before even getting out of the plane. You’ll hear the race as soon as you’re on the ramp (remember to pack earplugs, though they also sell them at the race). After walking through the beautiful modern GA terminal you’re a 20-minute walk from the event entrance, but the kind folks at the airport run a shuttle so you’ll be there almost immediately.

The true fans, either of beer or racing, show up on Wednesday and camp:

Imagine Burning Man with no philosophy…

Here are a Corvette and Lamborghini in 1st and 2nd place (within their class) after about 2 hours. They ultimately finished in the same positions. General Motors (Cadillac) also won all three top spots in the fastest “DPi” class.

A Ferrari appears to chase a McLaren (but they’re actually in different classes):

There is a modest midway of manufacturers’ booths and food. You can develop some new respect for your neighbor with the Hyundai Elantra:

Feel better about your job… there is an actual human zipped into this outfit in the 90-degree Florida sunshine:

Although there don’t seem to have been any drivers who identified as “female”, there apparently was a competition that may have featured some who identified as “women”:

(With the kids in tow, I was unable to stay for this important event and therefore cannot supply photos.)

Chevy’s contestants in the mechanical beauty contest… a flat-plane crank engine and a cutaway Z06 Corvette:

If you’re coming down from Maskachusetts or New York and are anxious to fit in, you might want to take the Hillary, Biden/Harris, Black Lives Matter, #StopAsianHate, and “In this plane we believe…” stickers off the Bonanza.

See you there in March 2023! (the kids are already preparing!)

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