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  #13  
Old 02-21-2016, 10:17 AM
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Re: How much does it cost to build a jgc?

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Originally Posted by billt View Post
And if they were all so profitable all the time, they wouldn't have needed those taxpayer bailouts to begin with, would they? What happened to Pontiac? Or when Lee Iacocca went begging to the United States Congress for money to make payroll? Pontiac is gone forever because of a lack of ability to turn a profit on their models. They managed to make billions for G.M. in their day. No longer. Profit is never guaranteed. Even for companies that existed successfully for decades. It's no different today.

You, (like many others), like to point to the big profits, of which there are many. However the pendulum swings both ways. When there is a mistake, it's equally costly. Just look at what happened to their stock prices, along with their dividends, if you need a reminder.

If you doubt that, look at what "Dieselgate" is going to cost Volkswagen. Literally thousands of dollars to fix every violating diesel car, and make it compliant. At best they've lost the profit on most every diesel model they've sold in recent times. At worst, if it goes to a forced buy back, it could conceivably bankrupt them. Remember, Volkswagen's diesel cars were the mainstay of their company. Granted it was all their own fault, but that in itself doesn't mean $h!t if your a stockholder.

As the ability for these big automakers to turn big profits increase, so does their operating costs, along with the ability to lose their ass. Add in stiff foreign competition, that didn't exist 40 years ago when the "Big Three" ruled the roost, and it's not always Sunshine and rainbows. The coin always has 2 sides.
Billt, I know you love to argue but no one is arguing the ups and downs of business in general. Regardless of the ups and downs, the auto industry (like any business) is always going to be looking at maximizing their profit any way they can. If the market won't bear the price they'll look at ways to take cost out of the vehicle... cheapen it up. If the profit margin doesn't match what their business model thinks it should be then they won't build it, or will stop building it.

We don't need to overanalyze it.

I threw out what I remember reading in the past and what I could find on the internet, nothing more. Motley Fool (for whatever it's worth) stated that it's reported to be around $10K in profit per Grand Cherokee. Using that profit margin with dealer invoice and whatever holdback and other incentives are will let you back figure what the approximate cost is to build one. That's about as close as anyone is going to come to answering the OP's question.

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  #14  
Old 02-21-2016, 10:30 AM
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Re: How much does it cost to build a jgc?

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Originally Posted by MDBones View Post
Regardless of the ups and downs, the auto industry (like any business) is always going to be looking at maximizing their profit any way they can.
Absolutely. Let's face it, they're not in business to keep people working. All I'm saying is they are not always as successful at it as everyone would like to think. As the profits rise, so do the abilities for catastrophic losses... Which we've seen time and time again. Along with the financial toll it's taken.
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Old 02-22-2016, 08:25 PM
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Re: How much does it cost to build a jgc?

I'm going to guess around 30k to build a 57k summit haha.
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Old 02-22-2016, 09:14 PM
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Re: How much does it cost to build a jgc?

There was an article in Automobile about Lutz and Piesch (sp). The article discussed board room politics and differences in management style and each ones history and biggest achievements. Piesch is gone from VW and so is the CEO that replaced him. Quite the debacle for the biggest auto company. Very interesting article. They mentioned costs for producing a unit at 15 -25k for all of VW's holdings except the top tier vehicles Bentley, Rolls etc. That may not include development and other expenses though. Just actual production of the vehicle.

I was searching Automobile and came across this article on Marchionne and platforms: http://www.automobilemag.com/feature...tform-sharing/

Face it we are driving vehicles that have as many beans removed as possible




AND MORE...


You’ve heard this before, but to outsiders, the one reason to buy or merge with Fiat Chrysler is to get your hands on Jeep. Beside its status as a global brand, Jeep is perhaps uniquely positioned as a nonpremium brand that makes premium profit margins, a position no doubt as enviable to Mercedes-Benz, BMW, and Audi as they add downmarket “entry-level luxury” models as to Hyundai, Ford, and Chevrolet as they try to sell premium models at luxury car prices.


from this article: http://www.automobilemag.com/feature...s-a-long-shot/


FIAT/GM/ Chrysler merger???
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  #17  
Old 02-28-2016, 12:21 PM
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Re: How much does it cost to build a jgc?

Line runs at $10,000/min on average, across trim levels. 72 vehicles per hour. You do the math.

Summits are much more profitable than Laredos.
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  #18  
Old 02-28-2016, 12:34 PM
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Re: How much does it cost to build a jgc?

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Summits are much more profitable than Laredos.
Any vehicle is that they can load more optional, overpriced crap into.
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Old 02-28-2016, 05:41 PM
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Re: How much does it cost to build a jgc?

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Originally Posted by Marlon_JB2 View Post
Line runs at $10,000/min on average, across trim levels. 72 vehicles per hour. You do the math.

Summits are much more profitable than Laredos.

At that rate it comes out to $8333/vehicle, on average.
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Old 02-28-2016, 11:51 PM
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Re: How much does it cost to build a jgc?

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Originally Posted by MDBones View Post
Be that it may, costs are always passed onto the customer and profit margins are maintained. Overhead can be compensated in part by what you said above about robotics, as well as the lower cost of buying parts in quantity and by reducing assembly line time. Locating parts production and assembly outside the US is another method. It is what it is.

When I bought my first GC in 93 my parents asked what I paid for it. I wouldn't tell them because even back then it was about 2.5 times more than what they paid to build their house in 1965. LOL...

So costs are always passed onto the customer and profit margins are maintained? If that's the case then why did these companies go bankrupt? With that line of thinking when the auto sales drop by 50% all they have to do is double the price of the vehicle and profits are maintained. The way it works is the market sets the price of a vehicle it has nothing to do with what it costs to build.
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Old 02-28-2016, 11:57 PM
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Re: How much does it cost to build a jgc?

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It's a lot less today, now that a lot of the overpriced, fat, lazy union labor has been busted out of the box. They milked the auto industry dry, much like the steel makers did to that industry. That, along with widespread use of robotics and computerized welding, painting, and assembly. These were big initial investments, but they've paid off big time with faster assembly times and much better overall quality. It's much more efficient to build with modern technology, than it was with overpriced fat, that got paid 80% of their take home pay to stay home "sick", or play pool. A Grand Cherokee assembled today with 1960's methods and people would cost more than your house, and be nothing but a rattletrap that would wear a path to and from the dealer.

Yes I know in Arizona you guys have those right to work minimum wage jobs with no benefits. That state has plenty of those. I am not defending the UAW but to say that is the only problem is ridiculous. Remember the company has to agree to everything in those contracts. So while the unions may have their negative points you still need to have them to keep all the wages and benefits from going the way of places like Arizona.
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Old 02-29-2016, 05:48 AM
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Re: How much does it cost to build a jgc?

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Yes I know in Arizona you guys have those right to work minimum wage jobs with no benefits. That state has plenty of those. I am not defending the UAW but to say that is the only problem is ridiculous. Remember the company has to agree to everything in those contracts. So while the unions may have their negative points you still need to have them to keep all the wages and benefits from going the way of places like Arizona.
That's total nonsense. I lived and worked in both Illinois and Arizona. My job here in Arizona paid better, and with better benefits, than any job I had in Illinois. And I never belonged to a union in my life. Not only that, but the cost of living is less than half. I never could have afforded to retire early there. Here, no problem.

Unions bust companies. Pure and simple. And they inflate the economy to ridiculous levels over time.... Until they collapse. Just look at the large aircraft industry in southern California. No one is building aircraft in southern California anymore. The last was Boeing's C-17 program that is no longer. It's workers were all dumped on the street. They were so overpaid Boeing could no longer afford to move them elsewhere. They simply weren't worth it. They priced themselves out of the market. Now they're fleeing southern California in droves.

If you want a good example of what unions do long term, drive through Detroit. Democrats and big labor unions ran that town right into the ground. They've all moved out, leaving behind a cesspool of $h!t in their wake. Much the same with northern Indiana. After the unions busted out all of the steel mills there, everyone left. In it's wake there is nothing left but crime, gangs, drugs and crack houses. You want to destroy a city? All you have to do is introduce Democrats and labor unions into it, then sit back and watch.

You'll have yet another example in southern California in just a few years. No jobs to support an insanely overpriced real estate market, that is full of 65 year old, $650,000 houses with 1,200 sq. ft. that no one can afford. Big labor unions have been played out. Belong to one and you'll wind up being the highest paid unemployed worker in no time. You used to see the Democrats play hard for their vote. Now, much like the unions, it's all but meaningless. Good riddance.
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Old 02-29-2016, 08:31 PM
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Re: How much does it cost to build a jgc?

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That's total nonsense. I lived and worked in both Illinois and Arizona. My job here in Arizona paid better, and with better benefits, than any job I had in Illinois. And I never belonged to a union in my life. Not only that, but the cost of living is less than half. I never could have afforded to retire early there. Here, no problem.

Unions bust companies. Pure and simple. And they inflate the economy to ridiculous levels over time.... Until they collapse. Just look at the large aircraft industry in southern California. No one is building aircraft in southern California anymore. The last was Boeing's C-17 program that is no longer. It's workers were all dumped on the street. They were so overpaid Boeing could no longer afford to move them elsewhere. They simply weren't worth it. They priced themselves out of the market. Now they're fleeing southern California in droves.

If you want a good example of what unions do long term, drive through Detroit. Democrats and big labor unions ran that town right into the ground. They've all moved out, leaving behind a cesspool of $h!t in their wake. Much the same with northern Indiana. After the unions busted out all of the steel mills there, everyone left. In it's wake there is nothing left but crime, gangs, drugs and crack houses. You want to destroy a city? All you have to do is introduce Democrats and labor unions into it, then sit back and watch.

You'll have yet another example in southern California in just a few years. No jobs to support an insanely overpriced real estate market, that is full of 65 year old, $650,000 houses with 1,200 sq. ft. that no one can afford. Big labor unions have been played out. Belong to one and you'll wind up being the highest paid unemployed worker in no time. You used to see the Democrats play hard for their vote. Now, much like the unions, it's all but meaningless. Good riddance.
I think if you look at stats for wages and benefits for Illinois and Arizona that would speak for itself. You may have done better but I don't think that would be the norm. I think its funny you mention Boeing because that is a big Union company that is doing great. I think if I were making an argument against unions that would be the last company I would bring up. I'm not here defending unions because I know they are part of the problem in some of these cases and I can agree with some of your comments. As far as California real estate if no one can afford the homes the prices will come down. That's how real estate works supply and demand.
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Old 02-29-2016, 08:45 PM
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Re: How much does it cost to build a jgc?

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So costs are always passed onto the customer and profit margins are maintained? If that's the case then why did these companies go bankrupt? With that line of thinking when the auto sales drop by 50% all they have to do is double the price of the vehicle and profits are maintained. The way it works is the market sets the price of a vehicle it has nothing to do with what it costs to build.
It's not as simple as you're trying to make it out to be. How was the economy doing when that happened? If people could no longer afford their mortgage they certainly couldn't afford to buy new cars, no matter what the automakers charged for them.
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