Print

Please login or register.
1 Hour 1 Day 1 Week 1 Month Forever
Login with username, password and session length

[ZeroSinMA]

I do not understand how Daimler AG can sell an entire electric car for the same starting price of $12,995 as Zero's Zero S electric motorcycle.

http://www.smartusa.com/comparevehicles/

http://www.zeromotorcycles.com/zero-s/order.php

The bill of materials (BOM) for the Smart has to run into 1000s of parts vs 100s for the Zero S.

Air conditioning.

Heating.

Sound system.

Power windows.

Etc, etc.

Then there's the battery pack, long assumed to be Zero's #1 COGs hit.

The entry level Zero S has an 8.5kWh LiIon battery pack, less than half the size of the entry level Smart with a 17.6 kWh LiIon battery pack.

Is Zero is making a fat profit margin or is Daimler losing a bundle on every Smart EV it sells?

Theories? 

[Pprior]

Big car companies can lose money on a product. Zero has smaller margins of scale and also a need for capital for development.

[ultrarnr]

Take a look at other motorcycle brands and the volume of bikes they sell compared to many car companies. I am sure economy of scale plays a huge part in the price of most motorcycles when you compare them to most car companies.

[ColoPaul]

I do not understand how Daimler AG can sell an entire electric car for the same starting price of $12,995 as Zero's Zero S electric motorcycle.

Ummm, fine print time.

"As low as $12,490[1] with Battery Assurance PlusSM and after federal tax credits of $7,500".   So this implies an actual MSRP of $20,000.

There's also something funny about the "[1]" that's plastered everywhere on the link you provided, but I can't find what it's referring to.
Here's a link which pretty clearly states the real MSRP is $25,000:

http://en.ta64.smart.com/is-bin/INTERSHOP.enfinity/WFS/mpc-us-content-Site/en_EN/-/USD/Smart_CC-Line?d=true&rurl=&modelCode=&lineCode=A03edc&lastEngineCode=

[firepower]

Even more expensive in Australia. Don't know how they can justify these prices compared to USA and Europe.
Anyone have pricing for HongKong or South America?

ZERO S 8.5 $20,490
ZERO S 11.4 $23,390
ZERO SR $25,490
ZERO DS 11.4 $23,490
ZERO FX 5.7 $19,490

Also Australia and USA have signed the unFair Trade Agreement. I sure its a case of local importer price gouging.

[frodus]

Big car companies get huge subsidies too.... Zero and Brammo.... Not so much. Also a lower fed incentive in the USA.

I think they likely lose some money.... But they NEED these vehicles sold in order to meet got regulations on carbon credits... At lease here in the US. Likely similar for other countries. It offsets all of the shitty heavy polluters.

[arno]

Here in Germany the electric smart is delivered with a battery you have to rent.
You do not own the battery but pay a certain sum each month depending on kilometers/year.
Starts at 60 Euro /month.
In case of selling the car the new owner has to enter this contract and is credit checked before.
I think, the most value part of the zero motorcycle is the lithium batteryyou have really bought.

[ZeroSinMA]

Thanks all for your thoughts on this. The answer is that $12,995 isn't the actual MSRP. This amount includes a $7,500 rebate plus a monthly service charge for the battery that is not part of the purchase price, and you do not own the battery outright. The real MSRP is closer to $25,000. On the COGs side of the equation Daimler can take advantage of economies of scale, and leverage the Smart platform that it sells in volume with as ICE vehicles. Most of the car design is a sunk cost, and most of the parts are purchased from suppliers in high volumes for all of the versions of the car that are built on the Smart platform. Finally with respect to gross margins, Zero only sells Zero Motorcycles and cannot afford to sell each unit at a loss whereas Daimler can and perhaps has to in order to earn credits designed to reward makers of so-called "green" electric cars.

The price, cost, and margin equation is:

+ =



I wonder if Zero can sell more bikes by lowering the MSRP and adding a battery pack rental option.

[Lipo423]

Agreed...in Spain you would pay 17.280 Euros for an SR, while in the US is around $17.000, this is 35-38% cheaper at current exchange rate...
In Europe it has to do with local taxes, homologation and bla, bla, bla...whatever they tell me it should not be more expensive...on top of it our lovely transportation minister has eliminated the government rebate you got in 2012, because motorbikes are "dangerous" 

Even more expensive in Australia. Don't know how they can justify these prices compared to USA and Europe.
Anyone have pricing for HongKong or South America?

ZERO S 8.5 $20,490
ZERO S 11.4 $23,390
ZERO SR $25,490
ZERO DS 11.4 $23,490
ZERO FX 5.7 $19,490

[Doctorbass]

I think that if just like me you would ever have opened a Zero Battery you would understand how much complex this part really is!! wich translate directly to cost.

Motor on the S 2014 is sold  about 1200$, the controlelr is about the same price... the battery is using some of the best cell on the market and these are excellent desingn compare to the old 2011- Emoli cells. The battery design and parts reperesent alot i think and that's normal normal.

Just to give you an exemple .. on the 2012, the battery are made of EIG 20Ah cells. Every of these cells are sold about 65$ and probably that Zero are getting them half that price. every ZF9 battery are made of 18 x 6 =  108 cells and thatM's about 3500$ just for the cells !

Zero are continuously doing alot of ameliorations on their bike and over the last years they changed the frame few times over the last model wich translate directly  to higher cost for manufacturing.

I think that the price for these motorcycles is fair when taking account on how many amelioration they are making to their very nice bikes.

Dont forget that the maintnance for the Zero is minimum and this mean money in your pocket.

Over the entire life of the motorcycle, The total cost of a Zero compare with  the same performances ICE bike is less. no gas, no timimg adj, no filter, no oil change no gas! and cheaper insurance!

Doc

[benswing]

I wonder if Zero can sell more bikes by lowering the MSRP and adding a battery pack rental option.

I'm very interested in this idea.  The battery is a significant part of the price, if they were able to lease it or offer a "Battery Assurance Plan" like Smart Cars, then it may be possible to bring the cost of the bike down significantly.  Zero would own the battery, but you would own the rest of the bike. 

I hope they seriously consider this kind of option since it would probably help them move significantly more bikes.

[ZeroSinMA]

I wonder if Zero can sell more bikes by lowering the MSRP and adding a battery pack rental option.

I'm very interested in this idea.  The battery is a significant part of the price, if they were able to lease it or offer a "Battery Assurance Plan" like Smart Cars, then it may be possible to bring the cost of the bike down significantly.  Zero would own the battery, but you would own the rest of the bike. 

I hope they seriously consider this kind of option since it would probably help them move significantly more bikes.

Bingo. However, they will take on the added cost of administration of the battery pack rental program. If properly priced, it should at least run on a break-even basis. Then they can reduce the up-front cost of the bike by at least $3K.

[protomech]

$12500 Smart ED:

$25k base price
less $7500 federal rebate
less optional $5000 "Battery Assurance Plus" lease discount
= $12500

The Battery Assurance Plus program is an indefinite battery lease. It costs $80/month + taxes, and includes annual battery maintenance and a capacity guarantee.

One way to look at it is that you basically pay for the battery in 5 years. If you can finance the Smart ED at 0% interest for 60 months then the battery lease may not make financial sense.

However, another way to look at it is that the Smart ED with a leased battery is cheaper to buy outright than any gas Smart model, and it will almost certainly be less expensive to operate if driven regularly.

Smart gas costs approximately 10.6 cents per mile ($3.80/gal national average for 91 octane / 36 mpg combined). Call it 15 cents

Smart electric costs approximately 3.5 cents per mile ($0.11/kWh national average * 32 kWh/100 miles)

Smart electric saves $0.071/mile for fueling, so it'll probably be cheaper to drive 1000+ miles/month on electric than gas.

[ZeroSinMA]

$12500 Smart ED:

$25k base price
less $7500 federal rebate
less optional $5000 "Battery Assurance Plus" lease discount
= $12500

The Battery Assurance Plus program is an indefinite battery lease. It costs $80/month + taxes, and includes annual battery maintenance and a capacity guarantee.

One way to look at it is that you basically pay for the battery in 5 years. If you can finance the Smart ED at 0% interest for 60 months then the battery lease may not make financial sense.

However, another way to look at it is that the Smart ED with a leased battery is cheaper to buy outright than any gas Smart model, and it will almost certainly be less expensive to operate if driven regularly.

Smart gas costs approximately 10.6 cents per mile ($3.80/gal national average for 91 octane / 36 mpg combined). Call it 15 cents

Smart electric costs approximately 3.5 cents per mile ($0.11/kWh national average * 32 kWh/100 miles)

Smart electric saves $0.071/mile for fueling, so it'll probably be cheaper to drive 1000+ miles/month on electric than gas.

If Zero sold the Zero S for $9,995 and leased the battery for $49.95/month in perpetuity including replacement (if not abused, etc.), I bet they'd sell a lot  more of them and make more money, too. I can tell you right now my wife will fall for it, er, I mean go for me buying another one! 

[Richard230]

I think Zero could do that with the FX and its removable battery modules.  But I would imagine that the S and DS models would require a complete redesign to make their batteries replaceable by the owner. 

I know that I don't like the idea of paying any monthly fees after my initial purchase of a vehicle or anything else where I am not paying for an obvious service.  That is why I always pay cash for everything that I buy and never buy anything on credit.  Plus, once I buy something I never want to feel like the seller has me on the hook and will raise the monthly cost at will once I have taken the bait.  So I would not be a customer for battery leasing.  Personally, I would rather pay more upfront and own the batteries.