Monday, June 14, 2010

Fisker Auto's $88,000 Plug-In Hybrid and my own random thoughts.

NOTE: The following post goes all over the place without a specific logic to it other than my coffee induced curiosity and the ability of Google to serve up info.

I noticed in the SIJ website this morning an update about the massive fund raising success of Fisker Auto in its pathway to market for a plug-in electric hybrid vehicle.  The price tag hit me though at $88,000.  Then I thought back to a few books I read about the invention of the auto industry and the early cost of utility vehicles such as the Curved Dash Olds and Model T.    

So I ran it through an inflation calculator (don't ask why I just did).  In 1908 the year the Model T came out that would have been $3,584.  Not comparably cheap even by early adopter status.

The Curved Dash Olds first sold for $650 in 1901.  According to Tom's Inflation Calculator a 1913 Olds selling for $650 would adjust to a $18,895 price tag.  Being the low end no frills electric vehicles with no options or safety go for way below this the industry ain't doing to bad.

The Model T first sold for $825 in 1908 and ultimately after decades of engineering excellence by the Ford Motor Company sold at it's lowest as $260 by 1924.  To adjust that get's fun for one reason.  In 1908 the 2010 value of a Model T was $20,253 which is what a reasonably equipped sedan goes for today.  By 1924 you could buy a more reliable and improved Model T for $3,257!  

Anyone else see a trend similar to computing power and gasoline power train?  That drop in true cost of a vehicle really blew me away.  Now lets hope that EV's take a similar pathway in innovation on a far accelerated timeline.

Side note.

The 1901 Curved Dash Olds was the first mass produced cheaper automobile.  The pioneering horseless carriage. Its original success beyond hobbyists was its ability to speed up the day for a travelling professional who would not have to worry about a horse.  For doctors and lawyers traveling within 30 miles of their home this hugely improved their productivity more than paying for itself as an investment.

I don't have proof of it handy.  But while reading one of the better histories of the auto industry they related the cost of a vehicle to the median income in the US at the time.  That would place a curved dash at the time it was introduced to being the equivalent of $70,000 today.

It wasn't till 1908 that Henry Ford introduced the Model T and began to focus on ever improved and lower cost vehicles (and of course we saw how cheap he got).  

The history of the early auto industry was of visionary engineers and entrepreneur wanting to mass produce cheap vehicles and the bankers, investors, and managers around the industry who demand high end high margin pleasure vehicles (because why would anyone want a vehicle for utility purposes?). In fact the amazing early history of Chevrolet and the founder of GM Billy Durant is one of lower mass markets versus higher end markets.  Billy Durant literally swindled his company back from a group of bankers by setting up Chevrolet and trading its stock on the open market for GM stock till he had 51% of the shares back.  

 Special note of personal perspective.  The Oldsmobile ushered in the modern auto industry of the world at the dawn of the 20th century.  It also exited business as an auto brand at the dawn of the 21st century.  There is a bookend story to be had here if I ever put it together.

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