Strong C7 Corvette Sales Mean More Profits for GM

Ronnie Schreiber
by Ronnie Schreiber

2015 Corvette Z06. Full gallery here

The Chevrolet Corvette may be outselling all of Porsche’s sports car models combined, but GM will still sell fewer Corvettes this year than the number of Chevy Cruzes they are likely to sell this month. You might think that one of General Motors’ lowest volume cars could not contribute much to the company’s bottom line, but the success of the 7th generation Corvette will mean hundreds of millions of dollars more in profit this year for the automaker.

Full gallery here

When the latest Corvette was introduced in early 2013, annual sales had been in the 12,000 to 14,000 unit range since 2009, about a 2/3 drop from sales a decade earlier. I can remember when there were rumors in the 1990s that GM might kill the Corvette because sales had dropped to about 25,000 cars a year so it was somewhat surprising that the ‘Vette survived GM’s bankruptcy with sales at half that level.

Full gallery here

At the C7’s introduction in January of 2013, I was talking to Harlan Charles, Corvette majordomo (actually his official title is product and marketing manager for the car) and he surprised me when he said that the program was profitable at the then current build rates. When I expressed skepticism and mentioned the rumored demise of the ‘Vette in the ’90s, Charles said that it wasn’t the 1990s anymore, that efficiencies had been implemented and that the Bowling Green Corvette assembly plant made money making a fraction of the cars it used to make. In 2012, Chevy sold about 14,400 C6 Corvettes in North America. The C7 edition has been well received and Chevy has sold more than twice that number in just the first half of 2014, 18,500. Unless something completely unexpected happens, the Corvette should easily surpass 30,000 sales this year and possibly exceed 35,000.

Full gallery here

Mark Reuss, who is GM’s president for North America, has publicly stated that the ‘Vette “makes as much money as any of the top-profit models in our company.” Those pickups can represent five figures of profit on vehicles with higher transaction prices. Adam Levine Weinberg at The Motley Fool website takes Reuss’ comments to mean that gross profit per vehicle (not including development costs) on the C7 Corvette could be $10,000 or more. That means that the 20,000 or so additional Corvettes that GM will sell this year compared to last year works out to an additional $200 million in gross profit.

Full gallery here

Now for a company that booked a net profit of $3.8 billion dollars last year, $200 million isn’t a huge amount of money, but it’s far from chump change. With Chrysler just introducing the 707 horsepower Hellcat edition of the Dodge Challenger, there will be pressure on the Corvette team to respond with a higher performance model than the 650 hp Z06 version of the ‘Vette. While that $200 million may be a fraction of GM’s total profits, it will certainly make it easier for Mr. Charles and his team to convince Marry Barra and her team to greenlight a ZR1 Corvette with even more power than the Hellcat.

Ronnie Schreiber edits Cars In Depth, a realistic perspective on cars & car culture and the original 3D car site. If you found this post worthwhile, you can get a parallax view at Cars In Depth. If the 3D thing freaks you out, don’t worry, all the photo and video players in use at the site have mono options. Thanks for reading – RJS

Ronnie Schreiber
Ronnie Schreiber

Ronnie Schreiber edits Cars In Depth, the original 3D car site.

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  • Fred Fred on Jul 18, 2014

    Nice to see that the limited production Vette makes money. Wish they could figure out how to do the same for more affordable limited production models.

    • Bd2 Bd2 on Jul 19, 2014

      Um, you do know that GM had an operating profit of $7.5 Billion for North America last year? And taking out overseas losses, restructuring costs, etc. - still made $3.8B in profit. Audi makes the bulk of profits for VAG - so once GM gets Cadillac and Buick totally in order, profits should rise at GM. Also, GM is the one domestic to build a SUB-compact in the US (the Sonic) and they do it profitably.

  • TMA1 TMA1 on Jul 18, 2014

    That gray and black car looks fantastic. The Z06 seems like overkill though. I priced out the Vette I want, and it comes in at just under $59,000. Now if only I had someplace to keep it...

  • Dukeisduke Is the Volvo EX30 even on sale yet? It was pulled from the NACTOY awards because they were having software problems with the vehicle.
  • Wjtinfwb If you've only got 5k to spend on transportation, I cannot imagine a worse way to spend it than on a GM orphan from Sweden that's 15 years old with 150k on the clock and limited plus expensive parts availability and dwindling techs who'd even want to work on it. Go find a similar vintage Camry or Accord with 150k miles or even a Ford or a Chevy, whatever. Hell, even an old Jaguar is less of a crapshoot than a Saab. At least you can still get parts.
  • Kwik_Shift Brands that were considered from China include BYD, Dayun, Great Wall Motors, Maxus, Nio, Omoda/Chery, Seres, XPeng, and Zeekr. KG Mobility from South Korea also made the list of candidates.That's a lot of car companies from there ready to head here.
  • Analoggrotto Clean sweep and unanimous victory for the world affluence engine of 22nd century : Hyundai/Kia/Genesis. Toyota and Lexus, for 120 years of history have not been able to capture the zenith superlative status of Hyundai Motor Corporation the most awarded, decorated and revered automotive corporation in the history of historical. Featuring best ever, first ever and greatest ever e-ATPs the Hyundai Genesis Kia lineup is posed to become the envy of every country club, ivy league college and fortune 500 corporation in the world. I've been taking a roadtrip in my loaner Elantra N, visiting colleges from east to west, elite universities of higher learning to inspect their parking lots. WHat did I find? Leagues of Genesis models, outnumbering Lexus 3 to 1. When I interviewed faculty and staff at these places of greater learning, their response was unanimous : they chose HMC for the ATPs.
  • Mikey 2019 Chevy Impala Premier FWD with 20 inch factory Bridgestones. I'm looking at replacing tires at the 65,000 KLM's (40,000 miles ) mark ....It doesn't thrill me .. I'm pricing Michelin Cross Climate 2 tires ouch !! ..Up here in Canuckastan ....Big $$$$$
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