Here's the Problem with Elon Musk ... - The Detroit Bureau

2022-03-11 09:44:28 By : Mr. Karma You

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Can some lawyers from Spain accomplish what Apple can’t?

Perhaps more importantly, can they do what Elon did: build a highly profitable EV company from scratch?

Those are the questions revolving around Hispano Suiza, a revival of a car brand that hasn’t built a car since 1946. The Spanish company isn’t without credibility as its president, a lawyer named Miguel Suqué Mateu, is the great-grandson of Hispano-Suiza’s founder. 

You might not realize it, but this company is no stranger to the car business, it’s just been a while since it’s been active. 

Considered by many to be a Spanish Rolls-Royce, Hispano-Suiza was established in Barcelona in 1904 by Damián Mateu and Marc Birkigt. Automobile production started a year later. By 1913, the company began building aviation powerplants, with its 1914 V-8 aircraft engine powering the SPAD XIII, a French biplane fighter aircraft flown in World War I. 

As for the company’s cars, they reached a zenith with the release of the 1931 Hispano-Suiza Type 68, also known as the J-12, powered by a 9.4-liter V-12 with as much as 220 horsepower and a top speed of 110 mph.

It employed a massive 70-pound crankshaft, and requires a water pump on each cylinder bank. Each chassis weighed less than 3,500 pounds before its custom bodies — from such coachbuilders as Kellner, Binder, and Fernandez and Darrin — were applied. Its cost: $10,147.50, or $179,431 today — before coachwork.

Perhaps the most impressive, if not memorable, of all Hispano-Suiza models is the 1938 Dubonnet Xenia powered by a 250-hp, 11.3-liter 12-cylinder engine. Sheathed in strikingly advanced styling by Saoutchik, it is the inspiration for the new Hispano Suiza’s model, the Carmen. 

As you’d expect, World War II brought demands for industrial production, not automobiles. At war’s end, French socialism and Spanish nationalism ended automobile manufacturing after production of approximately 12,000 cars. The company continued as an industrial manufacturer — until now.

Nothing aside from its name, which was once hyphenated but no longer is — for some reason. The automaker is owned and run by the descendants of the founders, who have revived the marque with the Carmen, a battery-electric coupe comprised of a carbon-fiber body and structure and a weight of 3,726 pounds. The name Carmen comes from the granddaughter of the company’s founder.

The first one in the United States was unveiled Saturday at the 27th Amelia Island Concours d’Elegance in Amelia Island, Florida. The customer, Michael Fux, is the CEO and founder of New Jersey mattress maker Comfort Revolution, and a well-known car collector.

The car he ordered is the performance-oriented Boulogne, with a 80-kWh, 700-volt battery pack sending 1,114 horsepower to four electric motors on the rear axle. That’s good for a 2.6-second 0-62 mph run, according to company officials. 

Oh, and one other thing: he ordered his carbon-fiber-bodied hyper car in fuchsia. 

Certainly the car is striking, with styling derived from the 1938 Saoutchik-bodied H6C Dubonnet Xenia, currently housed at the Mullin Automotive Museum in Oxnard, California.

All told, company officials expect the Carmen to entice 24 privileged buyers, with prices starting at $1.8 million. Like the company’s name, its pricing lives up to its heritage, ensuring this car will be sold solely to the well-heeled.

Although the company’s name is old, they are very much the neophyte carmaker — and they have taken the most difficult path imaginable to successfully re-establishing the brand. Rather than starting with an established driveline from a major OEM before graduating to its own powertrains and hardware, the company has developed everything in-house. This is a major undertaking — and a major expense.

So one has to wonder: will it ever make a profit on such meager volumes? The company thinks so, with executives considering it a craft manufacturer, not a mass manufacturer. 

Still, consider Bugatti, once a part of Volkswagen Group. It’s now controlled by Croatian EV upstart Rimac, although Porsche owns a 45% stake in the new company, called Bugatti Rimac. Still if VW can’t make a go of selling million-dollar hypercars powered by internal combustion engines, how can a neophyte operation profitably produce BEVs in such small numbers?

“Car companies making hand-built and exclusive products, such as Hispano Suiza, are playing a different game than mass market vehicle manufacturers,” said Sam Fiorani, vice president, global vehicle forecasting at AutoForecast Solutions LLC.

“With the new world of high performance electric vehicles, one of the largest regulatory costs, engine emissions certification, is removed from the equation. Spreading the cost of certifying a 600-hp V-12 across a few dozen vehicles makes for a large per-vehicle surcharge. With that cost removed, a seven-figure luxury vehicle has more room in the profit/loss balance sheet.”

And, Fiorani says, craft auto manufacturers can charge prices high enough to cover their costs because these vehicles aren’t bought for their value.

“Luxury goods like this are purchased for what the item says about its owner and not how much you get for the money spent. If you wanted value for your dollar, you’d buy cubic zirconia, and yet there’s still a market for natural diamonds.”

While it remains to be seen whether the company can be profitable and revive a name once synonymous with Rolls-Royce, look for a number of unique and rarified BEVs to be built by the resuscitated Spanish automaker.

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