Thursday, January 7, 2021

BUSINESS - Car Combo

In the WSJ article Forget Uber, Zoom Might Be the Long-Term Threat to Car Sales, there is this paragraph:

KPMG said more U.S. families might get by with one car in the future, potentially reducing the average number of vehicles per household to 1.87, from the pre-Covid level of 1.97.

The DocNgu Doodle is that car manufacturers should sell a 2-car combo. The first car is the "high end" car (an SUV, pickup, or luxury car). The second car is the "low end" car that will be sold cheaply if bought as a combo. The second car is used for short commute to the transportation line, and for local errands. This car will have 2 seats at most (even 1 seat), 3 wheels, good safety but not a lot of amenities. It will be sold as less than $5000 if bought along with the "high end" car. The combo will be sold without big monetary incentives (the "low end" car is the incentive already). Since incentives are already in the thousands of dollars, the "low end" car will not cost the manufacturer a lot, but will capture lots of young families who do need more than 1 car but less than 2 cars. The spouse that only needs a car to drive to the train station can use the "low end" car, leaving the "high end" car to the other spouse who needs it for longer commute or to drive to local events with a decent car. In the 1980s, word processing programs and spreadsheet programs were sold separately. Then Microsoft created the Office bundle and the rest was history.

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