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Re: fordgonracn post# 94130

Tuesday, 10/28/2008 8:28:53 PM

Tuesday, October 28, 2008 8:28:53 PM

Post# of 137667
Ford, I understand what you're saying, but let's think about it this way for just a moment.....

FF5 does around $7.5mm annually in 62,000 ft of space with a total of around 50 employees, and those employees do mostly manufacturing and packing as you indicate, and virtually no assembly for all intents and purposes. I'm surmising that they have this many employees because that's how many folks Dave and Mark Smith know that they need to make the number of kits that they sell now. The Smith Brothers haven't reached their #1 leading position in the industry by NOT knowing what their costs are, they're pretty sharp.

If RVGD is to hit the "two a week" GTM manufacturing number, that means that FF5 will be making at least 100 bodies and frames a year as contrasted to the 30 or 40 over almost three years that they've made so far. Logic dictates that this means they'll need significantly more labor and operating capital just to do what they're already doing, along with their coupes, cobras etc to knock out that many new GTM bodies. Now, if memory serves me, there are going to be material modifications to the base Revenge GTM, which complicates things even a little further.

We then get to the issue of OEM caliber overall assembly, well above and beyond anything that FF5 does right now, and that means that additional assembly, interior fitting, wiring, soundproofing, interior installation and painting are going to have to be done somewhere, and that place doesn't seem to be part of any current information that I've seen.

My point is a simple one: given that there may be an $80mm contract out there, don't there have to be more big players in the game to make manufacture of 800 GTM's (800 x $100,000) a viable concept?

At the 100 GTM's a year level (two per week), that's eight years of manufacturing to look at, which is going to require more capital for RVGD as well, unless their partner is an entity that hasn't been impacted by the current US / world economic realities regarding credit, operating funds and an evolving market.

All in all, this exercise isn't as simple or off-handedly facile to solve as the current "Go Revenge!!" attitude indicates. There are lots of sound economic reasons that start up car companies seldom make it, even in the best of times, and these realities represent a level of challenge exponentially higher now than when originally conceived.

I look forward to seeing the first Revenge GTM, but am really anxious to see how the overall manufacturing and business operational matrix evolves, because that's what will determine the success of Revenge.