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[Rewski]

However,  it would be nice if the designers thought about the extra money they could make selling the next gen powertrain for 'old' model owners to fit who aren't content with a slower shorter range bike because they can't afford 10k every year for an upgrade.

I have to agree with this. When I bought my original 2010 DS, Zero was running a promo for a free 2 year "no fault" warrantee. This was essentially an upgrade warrantee that would enable to you get any part upgraded if it broke but more importantly, an future upgraded part in future model years for 50% cost. I believe this was Neal's original plan and the reason for the style of battery pack the Zero has in place. The problem was that the 2011's already changed the frame to accommodate the belt drive so that even meant you could not even upgrade that portion of the bike. Obviously this was not my only reason for buying this bike back in 2010 but it also made it a stronger argument for the wife

Adam

[lolachampcar]

Updating parts on the bike is not going to happen given the changes in design.  Updating the whole bike IS going to happen for all the reasons previous posters have pointed out.

Zero can not do anything about the fact that a MY11 can not be updated to a MY12 or a MY12 to a MY13.  They can do something about paving the way for current customers to upgrade the whole bike.

[Richard230]

I was just browsing Zero's web site and noticed a link to a (relatively) long article by Cycle World where they go for a test ride on a couple of 2013 models.  Nothing really new, but this is the first magazine test ride that I have seen of the new models.  Cycle World must know someone at Zero.  Lots of photos attached to the CW review.   

The link to the article can be found here:  http://www.zeromotorcycles.com/news.php

A couple of links to other reviews are posted, but they just regurgitate the press release.

[ZeroSinMA]

I agree that Zero will eventually need to settle down and develop their models once the technology matures. But I think they have to continue to improve the models every year as long as that can be done.  That is the only way to advance the the performance of electric motorcycles and make them more desirable to future customers.  I also understand that current customers will be left in the dust.  But I don't see any other way for them to proceed, if we want the best performance available as soon as possible.  In my case my 2012 ZF9 Zero S meets my transportation requirements, no matter how good the new models are.  Fortunately, I can afford to buy a new one and take a loss on my current bike if I had to.  I think this is just something that we are going to have to live with for a few years.  The alternative is to have a company like Brammo that fully develops the technology for several years before placing their models on sale to the public. But that has its flaws, too.  Just pick your poison. 

ICE motorbike riders meet the Apple Computer improvement cycle. Expect your bike to become obsolete within 2 - 3 years.

Get over it.

Buy a new iPad or buy a Microsoft Surface RT?

A what?

Let's look at Zero's Lisa Computer era emtoto upgrade challenge.

Round numbers, just guessing.

Zero S BOM   
Motor   $300.00
10KwH LiION    $8,700.00
Everything Else   $2,000.00
Total   $11,000.00
   
List   $14,000.00
   
GP   $3,000.00
GM   21%
   
Dealer   $500.00 (17%)
   
GP-Dealer   $2,500.00
   
After-Market Value Year 1   $10,000.00
   
User Upgrade loss   $4,000.00
   
Zero Margin net of Dealer   $2,500.00

See the problem? The bike's 1st year depreciation > GP.

Zero has to keep looking for  new customers by improving product.

Early adopters can skip a year or two but we have to suck up $4K - $5K annual depreciation.

Welcome to the early adopter curve.


Apple Lisa 1984

$5,495 in 1984 = $11,709.59 in 2011 dollars

68000 processor 7.89 MHz (PowerMac G5 Dual Processor PowerPC 1.8GHz or 228 times faster)
2 megabytes of RAM (PowerMac G5 Dual Processor PowerPC 1GB or 500 times more memory)
Sony 400 kB microfloppy drive (PowerMac G5 Dual Processor PowerPC 80GB or 200,000 times more storage)
$279.95 or 1/42th the cost

Not that emoto bikes will improve at the same rate but you get the picture.

[machone]

ZeroSinMA - Good point, well made!


On the plus side: http://www.ebay.com/sch/Vintage-Computing-/11189/i.html?_nkw=apple+lisa

Wait 30 years and you can sell your 2010 for 1/3 the price!

[protomech]

I talked with TTXGPfan a bit about this, but the computer analogy is only partly applicable.

Certainly tech is advancing quickly. 2013 bikes are a pretty large upgrade over the 2012s.

But unlike computers, the environment they're being used in - software applications vs road applications - is not necessarily becoming more intense each year.

I think the best deal on an EV bike will be a one year old gently used model. It doesn't directly support the EV manufacturers, of course, but it does create demand for a used market.

I'm going to take a hard look at used 2013 bikes in about a year and consider an upgrade. I'd still like to see ABS - I think it's a huge safety benefit - and that could make me hang on for the 2014 bikes.

[machone]

But unlike computers, the environment they're being used in - software applications vs road applications - is not necessarily becoming more intense each year.

Also a good point. However, did all computer early adopters upgrade because they needed to run more complicated software or for other reasons ie keeping up with the Jones', convenience, not wanting the hassle of archiving stuff onto floppy, prettier graphics? I think it's less about the environment(no pun intended) and more about what else is available for similar purchase/running cost.
Why would anybody want a modern sport bike unless they had a licence losing fettish? And yet after mopeds and 125s the biggest selling big engine bikes in the UK for 2011 were the Fireblade and BMW GS. What environment are these riders in - one where speed limits are reduced and speed bumps have increased?
I think the point where electric bike sales will overtake ICE equivalents will be when the performance surpasses that of the ICE options. Not logical, but how many sport bike sales are logical decisions?

[lolachampcar]

Here is one big difference.  AT&T charges me $200 every two years to move to the latest phone....  They hide the true cost of ownership.

Zero can improve the cost of ownership equation if they want.  The dealers will see the wholesale to resale spread while the resale number will be higher due to Zero's participation.

Lastly, I checked on the battery for my 9DS before I bought the bike.  Dealer $3950 ish, retail $4800 ish.  The CoGS are less than you have estimated.  I suspect the overhead is greater (small volume applied to a necessary infrastructure)

[ZeroSinMA]

But unlike computers, the environment they're being used in - software applications vs road applications - is not necessarily becoming more intense each year.

Also a good point. However, did all computer early adopters upgrade because they needed to run more complicated software or for other reasons ie keeping up with the Jones', convenience, not wanting the hassle of archiving stuff onto floppy, prettier graphics? I think it's less about the environment(no pun intended) and more about what else is available for similar purchase/running cost.
Why would anybody want a modern sport bike unless they had a licence losing fettish? And yet after mopeds and 125s the biggest selling big engine bikes in the UK for 2011 were the Fireblade and BMW GS. What environment are these riders in - one where speed limits are reduced and speed bumps have increased?
I think the point where electric bike sales will overtake ICE equivalents will be when the performance surpasses that of the ICE options. Not logical, but how many sport bike sales are logical decisions?

The analogy isn't perfect. "Faster, smaller, cheaper, better" was the principle for PC innovation for decades. Steve Jobs was the first to figure out that a complete content ecosystem was the new adoption driver as the doubling of speed and storage every few years per Moore's law inevitably slowed down as the limits of silicon-based chip manufacture were reached.

The motto for Zero in this early stage is "Faster, farther, cheaper, better" with focus on range as range is the #1 determinant of market share. I'd estimate that every 10 miles of range over the average 52 mile round trip commute increases the total available market by 5%. By cheaper I don't mean the list price but lowering COGs so the company has more margin to play with to motivate dealers to pick up and sell the bike.

The focus on power density of the battery, recharge time, and drive train efficiently will continue.

I do think a Cruiser will sell well once Zero gets range up to the 160 miles.  

The main problem I have with buying a used Zero is I have no idea how the previous owner treated the battery. There's no way to know if it was abused.

The current 2012 has enough speed and range for my purposes. My next upgrade with be to Zero's first bike with ABS.

[Richard230]

My first "computer" was an English-made Sinclair that I bought in 1978.  It used a 3" reel-to-reel tape recorder as a storage device and a TV as a monitor. It was about the size of a soft-bound novel, as I recall.  The only program that I had was an airplane flight simulator that had a black and white screen.  I don't believe that it had a keyboard. My memory is kind of fuzzy after all these years. I do know that I lost interest in the thing after a few months and junked it as it just didn't to much, since there were very few programs written for the device and without a keyboard or printer you couldn't even use it as a word processor.

Kind of reminds me of my first two GPR-S electric motorcycles.  I figure we are into the Apple computer period of the 1980's now with the latest electric motorcycles.  Still lots of time left before the technology matures and performance levels off with each new model launch.

[ZeroSinMA]

Here is one big difference.  AT&T charges me $200 every two years to move to the latest phone....  They hide the true cost of ownership.

Zero can improve the cost of ownership equation if they want.  The dealers will see the wholesale to resale spread while the resale number will be higher due to Zero's participation.

Lastly, I checked on the battery for my 9DS before I bought the bike.  Dealer $3950 ish, retail $4800 ish.  The CoGS are less than you have estimated.  I suspect the overhead is greater (small volume applied to a necessary infrastructure)

No they can't. They don't have enough gross margin to meaningfully subsidize upgrades. Even if you're right and GOGs is $9,000 and GM is $5,000, they still need to give the dealers 15% and the total gross profit without cost of sales, G&A, etc. (fully loaded cost) is less than the depreciation on the bike in one year. They could maybe shell out $1,000 to soften the $4,000 depreciation hit but I think they are better off putting it toward R&D and making the bike better and getting the word out and getting new customers. Later once the company is established and has a large installed base then it makes sense to spend on upgrades, maybe. No ICE maker offers upgrade pricing that I'm aware of. At the point the company has to drive hard toward profitability in the company's investor's timeframe, which I'm guessing is 2 - 3 years. Spending on upgrades to a small installed base won't help get them there.

[trikester]

My first "computer" was an English-made Sinclair that I bought in 1978.  It used a 3" reel-to-reel tape recorder as a storage device and a TV as a monitor. It was about the size of a soft-bound novel, as I recall.  The only program that I had was an airplane flight simulator that had a black and white screen.  I don't believe that it had a keyboard. My memory is kind of fuzzy after all these years. I do know that I lost interest in the thing after a few months and junked it as it just didn't to much, since there were very few programs written for the device and without a keyboard or printer you couldn't even use it as a word processor.

Ha! I had exactly the same thing including the airplane flight program for my first computer. I quickly lost interest also, and eventually gave it to a computer whiz who wanted to make a power supply testing machine controller out of it. He found that he couldn't even use it for that purpose and tossed it.

Trikester

BTW - I hadn't ridden my gas trike (Yamaha conversion) to a monthly motorcycle meet in a couple of years. So yesterday I decided to do that. After much effort to keep it running I gave up. Old gas apparently had gummed up the carb so I'll have to take it apart. I turned to the bike sitting next to it, 2012 DS, inserted the key and took off for the meet. Nothing can make you love an electric more than messing around with fuel flow/carb problems on an ICE. 

[lolachampcar]

Here is one big difference.  AT&T charges me $200 every two years to move to the latest phone....  They hide the true cost of ownership.

Zero can improve the cost of ownership equation if they want.  The dealers will see the wholesale to resale spread while the resale number will be higher due to Zero's participation.

Lastly, I checked on the battery for my 9DS before I bought the bike.  Dealer $3950 ish, retail $4800 ish.  The CoGS are less than you have estimated.  I suspect the overhead is greater (small volume applied to a necessary infrastructure)

No they can't. They don't have enough gross margin to meaningfully subsidize upgrades. Even if you're right and GOGs is $9,000 and GM is $5,000, they still need to give the dealers 15% and the total gross profit without cost of sales, G&A, etc. (fully loaded cost) is less than the depreciation on the bike in one year. They could maybe shell out $1,000 to soften the $4,000 depreciation hit but I think they are better off putting it toward R&D and making the bike better and getting the word out and getting new customers. Later once the company is established and has a large installed base then it makes sense to spend on upgrades, maybe. No ICE maker offers upgrade pricing that I'm aware of. At the point the company has to drive hard toward profitability in the company's investor's timeframe, which I'm guessing is 2 - 3 years. Spending on upgrades to a small installed base won't help get them there.

I would not expect Zero to provide cash incentives to retain customers as there is no one capable of poaching their customers.  There is simply not a better option out there.

My point was that Zero can affect the total cost of ownership by taking an active roll in generating and facilitating a secondary market.  My local BMW dealership will take my trade in (at wholesale with a small bump from time to time to keep me coming back) when I "upgrade" to a newer car.  The dealer then goes through the car and, if it meets their quality standards, presents it on their lot as certified pre-owned.  There is no better place to move a used BMW then from the CPO lot at a dealer.  Those that want a quality used car will go there first while those that can not quite get the scratch together for a new car can be moved to pre-owned.

Some owners will sell their cars on the private market for a retail'ish number.  I've done that from time to time but normally give up the small gain once the trade in sales tax credit is taken into account for the ease of simply giving the dealer my car back in a single transaction.  I am suggesting Zero follow this model.  More revenue will go through each dealer (new and pre-owned sales) and more Zero product will make it to those not well healed enough just yet to buy new.  Those customers will have a relationship with Zero and Zero can follow though with the warranty in addition to opening up sales opportunities for extended warranties and the like.  Existing Zero customers will get the benefit of better resale value which lowers total cost of ownership; this is also a plus for Zero.

No one but Zero can do this.  If they choose not to, they run the risk of their product appearing overpriced given its relative value on the secondary market.  There will always be people out there buying the bikes at the current and MY13 pricing.  The question for me is what does it take to get beyond those customers?

[ZeroSinMA]

Here is one big difference.  AT&T charges me $200 every two years to move to the latest phone....  They hide the true cost of ownership.

Zero can improve the cost of ownership equation if they want.  The dealers will see the wholesale to resale spread while the resale number will be higher due to Zero's participation.

Lastly, I checked on the battery for my 9DS before I bought the bike.  Dealer $3950 ish, retail $4800 ish.  The CoGS are less than you have estimated.  I suspect the overhead is greater (small volume applied to a necessary infrastructure)

No they can't. They don't have enough gross margin to meaningfully subsidize upgrades. Even if you're right and GOGs is $9,000 and GM is $5,000, they still need to give the dealers 15% and the total gross profit without cost of sales, G&A, etc. (fully loaded cost) is less than the depreciation on the bike in one year. They could maybe shell out $1,000 to soften the $4,000 depreciation hit but I think they are better off putting it toward R&D and making the bike better and getting the word out and getting new customers. Later once the company is established and has a large installed base then it makes sense to spend on upgrades, maybe. No ICE maker offers upgrade pricing that I'm aware of. At the point the company has to drive hard toward profitability in the company's investor's timeframe, which I'm guessing is 2 - 3 years. Spending on upgrades to a small installed base won't help get them there.

I would not expect Zero to provide cash incentives to retain customers as there is no one capable of poaching their customers.  There is simply not a better option out there.

My point was that Zero can affect the total cost of ownership by taking an active roll in generating and facilitating a secondary market.  My local BMW dealership will take my trade in (at wholesale with a small bump from time to time to keep me coming back) when I "upgrade" to a newer car.  The dealer then goes through the car and, if it meets their quality standards, presents it on their lot as certified pre-owned.  There is no better place to move a used BMW then from the CPO lot at a dealer.  Those that want a quality used car will go there first while those that can not quite get the scratch together for a new car can be moved to pre-owned.

Some owners will sell their cars on the private market for a retail'ish number.  I've done that from time to time but normally give up the small gain once the trade in sales tax credit is taken into account for the ease of simply giving the dealer my car back in a single transaction.  I am suggesting Zero follow this model.  More revenue will go through each dealer (new and pre-owned sales) and more Zero product will make it to those not well healed enough just yet to buy new.  Those customers will have a relationship with Zero and Zero can follow though with the warranty in addition to opening up sales opportunities for extended warranties and the like.  Existing Zero customers will get the benefit of better resale value which lowers total cost of ownership; this is also a plus for Zero.

No one but Zero can do this.  If they choose not to, they run the risk of their product appearing overpriced given its relative value on the secondary market.  There will always be people out there buying the bikes at the current and MY13 pricing.  The question for me is what does it take to get beyond those customers?

I'm not going to go into details but I sold my 2011 to the same dealer I bought my 2012 from. There is no official policy but I expect Zero pitched in to make the deal work. There's a decent secondary market for Zeros. The dealer said they frequently get inquiries about used Zeros. But these buyers are looking for a bargain that along with rapid improvements in new models spells 40% to 50% depreciation year 1. 

Zero can only pick up a small piece of that. It ain't cheap being an early adopter. You need disposable income, a life-is-short philosophy and an understanding wife... or husband.

[trikester]

When I told my wife that I had decided to buy the 2012 DS model even though my 2010 DS wasn't even a full two years old yet, she said; "well you know they will keep imroving them, why not wait until some future year's models come out. My reply; "I'm 77 years old. How many years should I wait to start riding an improved version"? Her answer; "oh".

Trikester

BTW - Spent today cleaning out the carb on my Yamaha conversion trike. Ugg!