Elon Musk stated on Tuesday, in responding to a report about the british tech company Dyson's unsuccessful effort to develop an electric car, that the major legacy manufacturers sell their automobiles at low to nil real margins.
“Selling replacement components to their fleet accounts for the majority of their profit, which ranges from 70% to 80% "It's past warranty," Musk explained. Musk uses the example of razors and blades to make his point.
“This is an advantage that new vehicle makers do not have. There is also a shortage of sales and service infrastructure "Musk continues.
“Selling replacement components to their fleet accounts for the majority of their profit, which ranges from 70% to 80% "It's past warranty," Musk explained. Musk uses the example of razors and blades to make his point.
“This is an advantage that new vehicle makers do not have. There is also a shortage of sales and service infrastructure "Musk continues.
Anand mahindra, an indian industrialist, agrees with tesla CEO Elon Musk that producing cars is difficult, and creating positive cash flow is even more difficult. “And we have been doing it for a long time. I am still sweating and labouring on it. It is a way of life for us..." mahindra continues.
Mahindra & mahindra (M&M) said this week that domestic passenger car sales increased by 17% in August, to 15,973 units, compared to the same month last year.
“Citing the zero or poor margins of legacy vehicle makers, large auto firms generate their revenues not from the sales of their cars but from the sales of replacement components like “razors and blades, Well Said," one twitter user said.