GM isn’t taking it easy with the all-new first-ever production mid-engine 2020 Chevy Corvette. One of the few facilities its kept running during the covid-19 outbreak and lockdown is just to crank out Corvette chassis, because we need our Corvettes at all cost.
From The New York Times:
With a pandemic raging, a handful of General Motors workers have labored on — including several dozen at a plant in Bedford, Ind., that makes chassis for the Chevrolet Corvette, one of G.M.’s most iconic and expensive vehicles.
A G.M. spokesman, confirming the accounts of workers, said the factory’s continuing operation was aimed at reducing a chassis shortage and helping resume Corvette production more quickly once the company reopens an assembly plant in Bowling Green, Ky.
GM already had to delay the first production of the new mid-engine model for about a month last year due to contract negotiations with the United Auto Workers union, so it’s likely not looking to delay things any further.
The Times reports that there are only 20 workers per shift, with three shifts, at the Bedford plant, which is down from about 250 workers normally, to attempt to avoid spreading covid-19.
For a clearer picture of why GM is so thirsty over its new Corvette, just look at what Morgan Stanley has to say about the car:
A Morgan Stanley report in November predicted that Corvette sales would bring in roughly 2 percent of G.M.’s revenue in 2020, an estimated $3.3 billion, and put the car’s profit margin at 16.5 percent, about twice the company’s average in North America. (The analysts later revised their estimates to account for the pandemic’s impact.)
The Morgan Stanley analysts said the Corvette could be critical to G.M.’s longer-term strategy if the company could take advantage of the car’s brand name and customer loyalty in other lines of business, such as B.E.V.s, or battery electric vehicles.
Corvette is “more than a needle-mover for G.M.,” the analysts wrote. “We’re looking at the potential of a hypothetical Corvette brand expansion, into S.U.V. and B.E.V.s, as a way for G.M. to help fund the transition to electric.”
Really struggling to believe that the Corvette is actually a measurable 2 percent, but with such a juicy profit margin and likely high demand for an all-new, first ever mid-engine model, and I guess the demand and the math eventually check out.
Next time we get upset over losing a sportier model let’s ask ourselves if it will bring in $3.3 billion with a 16.5 percent profit margin in one year.