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144 points herbertl | 11 comments | | HN request time: 0.001s | source | bottom
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mixedCase ◴[] No.43275007[source]
That's way too expensive for an "affordable EV".

The BYD Seagull retails here in Uruguay for less than that and we tax cars at about 100%. On China it seems to go for 10-12k.

It's a proper, basic city car. 4 to 6 air bags, ~300km range (more than what this article's car indicates), all basic security features and standard gadgets out of a modern car.

Our EV infrastructure is not viable if you don't have a charger at work/home and yet these have sold like hot cakes.

Legacy carmakers are making increasingly worse ICE cars for the most part (btw does GM sell a C-segment hatchback on any market, anymore?) and their EVs are simply uncompetitive. What's it going to take for them to wake up to the fact they're going to have to stop fleecing their customers with crappy products? Bankruptcy?

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mattmaroon ◴[] No.43275107[source]
It's too expensive for an affordable EV in half the world I am sure. The wealthier half of the world will never let Chinese auto makers in. China wants to do the same thing they've done with other manufacturing, use government subsidies, borderline slave labor, and artifically low currency to eat the market and kill everyone else's manufacturing capacity until they have the market entirely.

There's no way we let that happen to cars. China's average auto worker pay is $4.20 an hour. America's is 6x that. What you call fleecing customers we call paying workers a living wage.

We'd rather pay $25k for a cheap EV and have a thriving auto industry than pay $10k and have none. We'd happily choose paying more for cars over Latin America-style wealth inequality, though lately it seems as if we're going to manage both at the same time.

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AlotOfReading ◴[] No.43275600[source]
Autoworker salaries have very little effect on the price of cars. The final assembly labor costs are a single digit percentage of the sale price. The corporate workers (myself included) are about the same again, despite being a much smaller percentage of the workforce.

The majority of costs are just the price of raw materials and manufacturing anything, whether in the US or abroad. What Chinese OEMs are doing isn't anything secret, it's just optimizing the other things to hit those price targets. Cutting out dealerships, better value engineering, lower executive/corporate salaries and benefits, cheaper electronics, limited features, vertical integration, and most importantly being willing to sell lower margin vehicles.

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1. Mengkudulangsat ◴[] No.43275804[source]
Every single expense in your P&L is ultimately salaries.

If it's not salaries in your P&L, then it's salaries in your supplier's P&L, or salaries your supplier's supplier's P&L.

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2. AlotOfReading ◴[] No.43275843[source]
Once you get more than a couple layers down in the supply chain, it's the same workers being paid the same wages for both American and foreign OEMs. The "labor price" of the same grade steel isn't vastly different for BYD and GM.
3. Fruitmaniac ◴[] No.43276371[source]
Raw materials costs are mostly based on scarcity, not salaries. If it weren't, steel would cost more that gold because it goes through more processing.
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4. adrianN ◴[] No.43276642[source]
Scarcity means that you require more work to mine the same amount of material.
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5. ivell ◴[] No.43276925{3}[source]
There is also economies of scale. Steel is much more useful than gold. This means investments on improving mining and processing will lower the costs in the long run.
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6. Epa095 ◴[] No.43276986[source]
You forgot energy.
7. wqaatwt ◴[] No.43277576{3}[source]
I’m not sure that’s necessarily true (or at all relevant) for a lot of precious or rate materials like gold. I don’t really know but I’d bet that gold requires much, much less labor to process than steel.

It’s just much more scarce so the people who own the mines can charge more for it.

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8. wqaatwt ◴[] No.43277594{4}[source]
Is processing and manufacturing steel actually cheaper than gold at any scale?

Gold is a very easy metal to work with. While iron into steel especially on a large scale isn’t trivial.

I doubt the cost of labor has a meaningful impact on the price of gold.

9. laurencerowe ◴[] No.43278040{4}[source]
Even high grade gold deposits are only around 10g/tonne or 1 part per 100,000 so you have to process a huge amount of material to recover a tiny amount of gold. Total world gold production was just 3000 tonnes in 2023.

By contrast a tonne of steel requires about 2 tonnes of iron ore and 0.8 tonnes of coal and 0.1 tonnes of limestone, all bulk minerals dug out of the ground. Total world steel production was 1.9 billion tonnes in 2023.

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10. wqaatwt ◴[] No.43278162{5}[source]
Yes, I would assume that certainly correct by weight/per kg. I was thinking more about per $ i.e. a gram of gold costs $100 I’m too lazy to look for exact figures but I would bet that labor costs (maybe even combined with energy costs) make up a very small proportion of that.

Edit: well I’m kind of wrong: https://www.gold.org/goldhub/gold-focus/2024/05/higher-gold-...

Profit margins seem to be about 50-70% currently but historically it was closer to 30% (of course that’s still many times higher than for steel production)

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11. laurencerowe ◴[] No.43284907{6}[source]
The profitability will depend on the production costs for each mine. Those at the margin set the price. If it stays high long enough new mines will open or too low and unprofitable mines will close. The excess profits earned by those that have easily accessible high quality ore are known as 'resource rents' but eventually they will be fully exploited and have to close.

Apparently a great uncle of mine found gold on his family farm in Scotland, but it was never profitable to exploit so saw no benefit from it!