Cars & Motorcycles, industry overview

[therealevan]

Hello

The cars / motorcycles industry is a fun industry to play with, while it shares similar characteristics as other products, selling Cars & Motorcycles can provide very good returns and gives you exposure to most areas of the game. I've gone through and flow charted all of the lines you can take to get to manufacturing. Just a few notes about the product lines before viewing the flow charts, a lot of these goods can be produced / used internally within your manufacturing infrastructure. You can also control quality entirely for all tiers of manufacturing if you desire, it will cost more to do this (general OpEx + R&D) but it will allow for greater control for quality.



*As you can see, both products require engines and Wheel/Tires (x4 for cars x2 for motorcycle). The only difference is that cars require car body whereas motorcycle just requires steel. The required quantity of input is noted below each product.




*These flow charts show the T1-3 products required for the final T4. Rubber, plastic, and glass aren't a real necessity to be manufactured internally. I would prefer to manufacture steel over all pre-requisite products as it is a main input for all tiers.

While I highly recommend maintaining internal sales for T4, you can generate additional revenue streams by allowing selling off any pre-req products (ie; steel/plastics etc) depending on how far down you choose to manufacture. Only do this in a conservative manner, for selling high quality T3 products used for cars/motorcycles can possibly give your competitors an advantage or even the playing fields. I personally will only sell off steel I don't need. Glass/car body/engines/wheels & tires i keep internally.

**

At the start of the game, you can start to manufacture the T4 goods (cars/motorcycles) by using imported goods. A small to medium sized factory is usually suffice for several autodealerships until the economy has developed enough for you to expand. I have observed that eventually you will require several factories per city to keep up with the demand for sales in most situations. Using a warehousing system to store T3 inputs (engines/carbody/wheel&tires) to help bolster rapid supply & demand changes.

Margins are very minimal in the early game, once you have better quality and higher technology you will have to pay attention to pricing and fight a thin margin battle.

**

To be continued.

[eleaza]

I would place engine and wheels production in the same factory, and produce them in the same city as the car and motorcycle factories. But cars and motorcycles have a very high freight cost, is it worth to manufacture them in one city and export them to other cities?

[therealevan]

But cars and motorcycles have a very high freight cost, is it worth to manufacture them in one city and export them to other cities?

No absolutely not, their freight costs are considerably higher than most goods in the game. For each city that I want to sell cars/bikes in, they will have their own manufacturing for that city. I might however move T2/T3 goods from other cities provided that I don't have to pay too much in freight expense.

[eleaza]

The accountant in me has a little doubt about locally produced cars and shipping cars from a cheap wage rate city, so I did some estimation to see whether it's really better to build factories for cars in every city.

A factory with 3 production lines for cars only has a base operating expenses = (180,000 overhead + 280,000 salaries) = 460k per month. Assume we build a factory in an average 65 wag rate city, the expenses = 460,000 x 0.65 ~ roughly about 300k. Shipping cars from one city to another, depend on city-to-city distance and truck freight cost let's say 1,500 per car (I've see much lower, if build the car factories near seaport, and city-trucking itself has 200 to 400 freight cost anyway, but let's ignore it first), so the fixed cost per car need to be less than $1,500 to be worth it, hence a city need to has at least 300,000/1,500 = 200 cars of demand, the operating expenses might be less than freight cost across city

200 is an extreme underestimate number though, since obviously freight cost can be much less, dropping to 1000, this goes up to 300 cars. Not to mention the wage rate can go as high as 90 which invokes more operating expenses. Also we need to include engines and wheels factories operating expenses if we also produce them locally (they have their own operating expenses and freight cost). So in practice I would say if a city has less demand than 400 cars, and if a well trained factories at Level 9 can supply all cities' demand, it's worth to export cars from a central production line. (A level 9 car factory can produce about 1200 cars a month, so I think it's enough for about 3 medium sized cities)

As for motorcycles, I feel that it's definitely not worth it to build a factory for it in every city, unless there's already idle production capacity for cars in that city.

[eleaza]

I would place engine and wheels production in the same factory, and produce them in the same city as the car and motorcycle factories. But cars and motorcycles have a very high freight cost, is it worth to manufacture them in one city and export them to other cities?
หนังอาร์

This is a new level of spamming bot? Just copy paste my post content?

[David]

Yes, it was a spam bot and I have removed it.