The Cost of Car Design: Unveiling the Pricing Factors and Key Steps

Introduction

Designing a new car from scratch is a mammoth task that involves numerous steps, each contributing significantly to the overall cost. In today's market, it is not uncommon for a carmaker to invest over a billion dollars to develop a new vehicle. However, the process is not always straightforward, and it is often a redesign of an existing platform. This article delves into the costs and key steps involved in the car design process.

The Development Process of a Car

Developing a new vehicle from scratch in today's terms is more than a billion dollars. The process typically starts with a design styling team, program management, inputs from marketing, manufacturing, and engineering. These teams work together to come up with the initial concept that would later be realized as a clay model for managerial approval. The cost for a full-size model, which is a significant portion, marks the beginning of the financial commitment required for a new car design.

Once the design is approved, the actual development phase begins. This involves the creation of prototypes to test and validate various aspects of the car. The prototypes are crucial for ensuring that the design meets all intended specifications and performs well under real-world conditions. However, the cost of these prototypes can still be quite substantial.

The Dominant Cost Factor: Tooling

But all these costs pale in comparison to the tooling costs. Tooling involves the production of small parts, such as engine blocks, frames, and other essential components, as well as larger components such as body panels. The cost of tooling can be enormous, making it a significant risk for manufacturers. To mitigate this risk, manufacturers often conduct customer demand clinics or market research to gauge interest before committing to tooling.

Key Steps in the Design Process

Step 1: Initial Concept and Clay Model

The process starts with the design styling team and program management working together to develop the initial concept. This concept is then refined and realized as a clay model, which is used to get managerial approval. The initial concept may be influenced by factors such as market trends, customer feedback, and technological advancements.

Step 2: Prototyping

Once the design is approved, the team moves on to the prototyping phase. This involves creating prototypes to test and validate various aspects of the car. The prototypes help ensure that the design will perform well under real-world conditions and meet all intended specifications. This phase is crucial for identifying and addressing any potential issues before moving on to the production phase.

Step 3: Tooling and Production

The most significant cost factor is the tooling phase. Tooling involves the production of small and large components needed for the car. This includes parts such as engine blocks, frames, and body panels. The cost of tooling can be enormous, and it is typically only undertaken after the design and prototyping phases have been completed and it has been determined that the design is feasible.

Conclusion

The cost of designing a new car is a complex and multi-faceted process involving numerous stages and significant financial commitment. While many factors contribute to the overall cost, tooling is the most dominant cost factor. By understanding the key steps and costs involved in the car design process, manufacturers can make informed decisions and create successful new vehicle offerings.