Quote:
Originally Posted by sambo
Sounds promising Craig - a dream start to the business.
I was reading your comment on the other forum about the prohibitive cost of producing a prototype and how your customers will help out with testing. I would've thought, given the interest and admiration for the kit that chassis #1 as a prototype would've been snapped up by eager buyers and more than paid for itself?
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Thanks mate. Just lots, lots, lots of hard work. There is a reason why the other manufacturers are not selling many or any kits. The market for kit cars has been very tough over the past few years. So you need to put in long hours, take the risks and have a product that customers want to purchase. We are certainly on our way now.
I don't think anyone can professionally build a kit car and actually recoup their labour at shop rates on the 2nd hand market. Plus if we did this, it would create issues for us legally on a number of levels. Plus the cost of testing etc, plus the total timeframe would be prohibitive. Believe me if this was the best approach for us, we would have taken it.
We do have a customer we are doing testing and fine tuning with. But you need to find the right customer, someone that is doing a mix of street and track work, that will test all aspects of how the vehicle will be used and is experienced in this sort of thing. We have worked with this customer before on prototyping our kits. We just can't afford the time and resources to do this ourselves, well we can afford it, just don't have the margin in the kit pricing to pass the cost onto our kit purchases.
Plus quite a few of the components on the PACE 427 have already been extensively tested by us over the past few years.
We have a very expensive kit when it comes to cost of materials used in it's construction and parts used in assembly. What makes it viable on paper is the implementatin of optimised manufacturing processes, volume production techniques and quantity purchasing of parts. We have also made moves to reduce our effective overheads and increase productivity. Basically it is a lot of kit for the money.
For a lot of kit buyers out there our comprehensive kit should reduce their build cost easily by $10,000 or more. Plus our body quality will save owner $3-4000 in body prep for paint, IF the owner decides to paint it.
We will try to keep our pricing as low as possible, but the current pricing may not be viable in the medium to long term and on top of that we are including a few specials to help get the ball rolling at the moment. If we can keep required quantity of orders coming in, then we will be able to maintain pricing.
I am hoping as we continue to get traction in the market place, sales will increase further.