A basic Chevrolet Tahoe starts at $53,695. The cheapest Cadillac Escalade you can buy is $79,440. These cars are built on the same GM platform, but there is more than $25,000 between the two base prices. Add enough options to the Escalade and it can get so expensive that a buyer can buy two Tahoes for one Escalade. Sure, the Escalade is a luxury SUV (nicer materials, better technology, different design), but when you consider the cost of materials for a manufacturer, it doesn’t cost that much more to build than the Tahoe to easily explain the cost difference. . That is the price of luxury.
What’s going on here is something called platform sharing, and the strategy has been going on for decades. In the 1960s, for example, the Chevrolet Chevelle, Pontiac LeMans, Buick Special, and Oldsmobile Cutlass all used the same platform. Fast forward to today, and the practice is still extremely widespread.
What is platform sharing?
Most describe a platform in similar terms, including things like the underbody, drivetrain, suspension, and axles. When you hear someone say a crossover is “car-based,” it means that the platform it’s built on is being used by a sedan or hatchback (as opposed to a truck) in the manufacturer’s lineup. An example of this is the Volkswagen Atlas. VW builds this mid-sized SUV on its MQB architecture, which is used for many other vehicles, including the GTI and Jetta. This demonstrates one of the great advantages of these modular platforms: flexibility. In the case of Volkswagen, it is able to adapt dimensions such as height, width and length to larger bodies, while still using the same modular platform. This kind of sharing is different from our example from Escalade and Tahoe. Those cars are much more interconnected than our Atlas/Golf case because there is no resizing or scaling.
Platform sharing is not limited to the same car company. For example, the Subaru BRZ and Toyota GR86 are largely the same and have been developed in collaboration between Subaru and Toyota. Nor is the practice limited to outward appearances. If you try to apply the logic of design to our Atlas vs GTI case, most consumers would never realize the two were sharing a platform. This shows how tricky it can be to decipher which cars are on a carmaker’s sharing platforms.
Why do car companies share platforms?
We spoke with Stephanie Brinley, Principal Automotive Analyst for IHS Markit, to learn more about why manufacturers choose to build cars this way.
“If you make things in common, you can reduce complexity, which can do a few things. One of them is reduce the cost to make the vehicle and how much the parts cost because they’re shared,” Brinley said. “The other thing that can happen is you can make processes, the way things are put together, the order they’re put together, common in a way that eventually improves quality as things get more repetitive.”
By producing parts and chassis in higher volumes (i.e. scale), as we see in the platform sharing world, these vehicles become more profitable. The most money is saved in the planning and development phases. The Center for Automotive Research explains why profit has so much to do with platform sharing: “The development of vehicle platforms is quite expensive, requiring a minimum sales threshold to be reached before the engineering and equipment costs are recouped. This is an important driver to increase the number of of platforms in an OEM’s portfolio, and with an emphasis on global platforms to be able to produce the largest number of units of common platforms and component sets.”
If a manufacturer can sell many different car models with the same platform, it will be easier to make a profit than if each model had different bones. This is especially true when the same platform is shared between expensive luxury models and more mainstream models that must adhere strictly to a specific price point. The production process becomes more cost-efficient because there are fewer differences between vehicles. Parts procurement and procurement have been streamlined for the same reasons as before.
There are counter-arguments to building high volume platforms. First, it can tarnish the reputation of a luxury car. People would be less likely to choose the luxury version of a car if they see too many similarities between the car and the more economical choice.
A variety of regulations and requirements worldwide makes it more difficult to build a single platform that can be used globally. A car company has to design the entire architecture of platforms to comply with the rules in each market where it wants to sell the vehicle. According to Brinley, regulatory nightmares can arise in these situations. She points to the example of the Tesla Model 3. The huge screen on the dashboard meets US safety standards, but according to some European regulations it can’t stay as high as it does. This forces Tesla to redecorate the interior so that it can be sold in certain countries.
Post-sale stakes are raised for platforms intended to support millions of cars as well. Takata airbags are a prime example of problematic parts sharing between platforms.
“If you have the same part in a vehicle that you build different vehicles with, if you have a recall of that part, the cost of that part is much higher. That’s a risk,” says Brinley.
Regardless of these platform sharing pitfalls, it will still be our future. More and more electric vehicles coming through the pipeline could lead to even more sharing. Brinley believes that due to the reduced complexity of electric vehicle platforms, manufacturers may expand the practice further.
“There’s potential that there’s more flexibility in that (electric car platforms) and actually build more cars out of that. If you go to something where the battery is in the frame and low, and the motor is much easier to place, you You have more flexibility with what you do with everything and above, because you have a pure electric vehicle that doesn’t need as much space for an engine and a transmission like we do now. What you need is much smaller,” says Brinley.
There are limits to how far we can go with platform sharing. Manufacturers will continue to push those boundaries, at least until they stop making money.
“They include it to the extent that it makes sense. If you try to stretch one platform too much, the cost of customizing it can be more expensive than just creating another,” Brinley says.
Our opening example of the Tahoe vs. Escalade perfectly illustrates one of the concepts of platform sharing. Looking at both SUVs, it’s not a difficult task to see that the Escalade borrows a huge amount of parts from its cheaper Chevrolet brother. Savvy consumers will likely be able to spot similarities between brands that share platforms. Don’t expect to notice it any time soon, as fewer platforms also means less costs for auto companies if they do it right.
“The drive to reduce platforms is ongoing. It will continue,” says Brinley.
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