Em Danger Period

Ty said:

I'm hoping that you'll see the first couple of months production driving a huge increase in orders. I really don't see selling 1,000 cars a day though. I know, bad Elio Fan, bad. But, I hope they do. They won't be able to shut down a shift and start it back up on a whim. But, like most things, demand will be high at first and then probably taper off. I can see Elio starting with one shift and going to two for a while until it shows there isn't quite the demand for two shifts worth of production. They can throttle the lines though so it isn't all or nothing. Instead of popping an Elio out every 54 seconds, they can lengthen that a bit. Let's say they stretch it out to 90 seconds a vehicle. That would have each shift producing 320 vehicles rather than 533 that the line can run. That's a difference of 426 per day. So, Elio can handle a 60% swing in demand. By the time that comes to pass, they'll have a really good feel for demand. They should look into exports to Canada by then and THAT will allow them to keep the second shift.

Look at the bright side - if they go down to a single shift, they'll be able to pick and chose the best between shifts.

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Ekh said:

Alternatively, keep both shifts but drop a day's production, running 5 instead of 6 days per week (I think that's what they're planning to run). Most folks would rather deal with a reduction in pay than a lay-off, don't you think?

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Ty said:

I'm hoping that you'll see the first couple of months production driving a huge increase in orders. I really don't see selling 1,000 cars a day though. I know, bad Elio Fan, bad. But, I hope they do. They won't be able to shut down a shift and start it back up on a whim. But, like most things, demand will be high at first and then probably taper off. I can see Elio starting with one shift and going to two for a while until it shows there isn't quite the demand for two shifts worth of production. They can throttle the lines though so it isn't all or nothing. Instead of popping an Elio out every 54 seconds, they can lengthen that a bit. Let's say they stretch it out to 90 seconds a vehicle. That would have each shift producing 320 vehicles rather than 533 that the line can run. That's a difference of 426 per day. So, Elio can handle a 60% swing in demand. By the time that comes to pass, they'll have a really good feel for demand. They should look into exports to Canada by then and THAT will allow them to keep the second shift.

Look at the bright side - if they go down to a single shift, they'll be able to pick and chose the best between shifts.

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Sethodine said:

Aside from Canada, I think the Elio would be very popular in Europe. France, for instance, is trying to slowly cut down on the number of Diesel cars and switch to gasoline because of the terrible smog in Paris and other population centers. And places like the UK, where gasoline is even more expensive than in Canada, would certainly benifit from 84mpg.

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Rob Croson said:

Don't the European countries already have an established market of small, fuel efficient cars? People keep pointing to various European microcars, and how the Elio really isn't "small" in the way they mean small in Europe.

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Ekh said:

I think you're right about the first six months being the most dangerous time for Elio Motors. They're going to face debt service costs on their start-up loans and will need additional working capital to see them through the first year. There's so much profit built-in to the Elio that if sales grow as hoped, they'll be fine, and in a couple of years have their debt cleared (except for operating capital loans). But that could be a very rocky couple of years.

Elio's second problem, acknowledged in their IPO offering documentation, is the rapid growth in electric cars. That's where the true competition lies ... and if the price of batteries continues to drop (as Elon Musk is doing his damnedest to see that it does), Elio's going to find its market nibbled at by price competitive, small electric sedans.

Elio is going to have about 5 to 7 years max before they have to morph into something else. Possibly the electric eelio! But that can't happen until the technology available (and the cost) change.

That's why the folks at DOE are looking so hard at financial viability.

So maybe there are NEVER more than 1.5 million Elios ever produced. That's enough to help a lot of people, maybe be truly profitable, and certainly to repay us all for our long wait.

On the sunnier side, if EM can survive the first year, profit comfortably for the next 3, and develop "the next great thing" in small, personal transportation ... well, maybe Paul's dream really will come true. It's not impossible!

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Sethodine said:

Considering the current number of reservations are at <7% brand recognition, I think that Elio Motors will be able to continue production for quite some time into the future. I'm a perpetual optimist, but I predict long wait lines for the first year of production.

By the time the domestic demand begins to slow down, international exports will begin. Aside from Canada, I think the Elio would be very popular in Europe. France, for instance, is trying to slowly cut down on the number of Diesel cars and switch to gasoline because of the terrible smog in Paris and other population centers. And places like the UK, where gasoline is even more expensive than in Canada, would certainly benifit from 84mpg.

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larryboy said:

Gas prices are not going to remain low forever. I remember the 60's when an hour of minimum wage labor would buy 3 gallons of gas. Then in the early 70's an hour of minimum wage labor would get you about 1 gallon. Now the pendulum has swung back again and it will buy 3 or 4 gallons. There will be some major disruption in the supply of gasoline again and the price will climb. Fracking reminds me of the sound you get when the malt cup is just about empty. If you work at it there is still some malt to be gotten but that slurping sound means that you are nearly out. If Paul had gotten his dream on the road several years ago Elio would be a fixture. If he is still in business when gas prices spike demand for the Elio will spike as well. I think he will find enough demand to see him through til that happens

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