Indego automotive concept, automotive consulting, steve young
Your Opinion
How important in the future is it to you to have your own car?
Financial ModelIndeGo provides superior financial returns to the conventional iautomotive industry business model for a number of reasons:
Product investment is reduced by high commonality, leverage of standard parts and bought-out major systems, and by avoidance of investing in product feature that is not valued by the majority of the customers. Because the vehicle is retained under single ownership throughout it’s life, the cumulative profit that would be taken at each change of ownership in the traditional model is instead captured by IndeGo. This can be in excess of 70% of the original capital value over 8 years As IndeGo own the vehicle throughout it’s life, they provide insurance, servicing and all required spare parts for every vehicle, and retain the margin on that business. By developing close multi-year relationships with customers, IndeGo also has the opportunity to cross-sell other products and services to those customers. These may be travel-related such as hotel accommodation, or totally unrelated such as home insurance. In combination, these factors generate a financial return (Profit before Tax) on sales of over 10% - an order of magnitude change to the low single figure percentage levels typical in the automotive industry today. |
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Steve's Blog
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- Feeding the habit?
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I have commented before
about the implications of the credit crunch on vehicle manufacturers as they have been forced to take writedowns of hundreds of millions of dollars on the loans and leases they used to prop up their sales volumes. In this last week, we have seen the obvious solution to this (if you are as addicted to this particular fix as the world's automakers seem to be) which is to hive off those toxic loans to your friendly government so that you can start all over again! MORE






