Chevrolet Sends Hard-Top Convertible Corvette Into Market Headwinds

(Bloomberg) -- The 2020 Chevrolet Corvette Convertible, which debuted on Oct. 2 at the Kennedy Space Center in Florida, is the first Vette in history to have a hard, retractable roof, rather than one made of canvas.

The hardtop on the new mid-engine Corvette Stingray Convertible folds seamlessly into the body, maintaining the fighter jet-inspired lines of the coupe version, providing a quieter cabin, and—in a feat of automotive alchemy—offering the same storage space as the coupe, even with the top down.

That’s 12.6 cubic feet, or enough to stow two sets of golf clubs in the trunk during open-air driving. An additional storage compartment in the front of the car, like those found in Lamborghinis, fits a single, carry-on roller bag and laptop case. It’s a triumphant update to a model millions of fans consider as American as apple pie.

“Our goal from the beginning was to make sure customers didn’t have to sacrifice any functionality, performance or comfort when choosing the hardtop convertible,” Josh Holder, Corvette program engineering manager, said in a written statement about the new car.

By transplanting the engine to the middle of the car, evening out its center of balance, GM is positioning it to handle better on the track and take on the likes of Porsche, Ferrari, and Lamborghini. The tactic harkens back to the origin of the car, which also has European roots: American GIs returning from World War II had seen the MGs and other European sports cars across the ocean and wanted something similar once they returned home.

Designer Harley Earl persuaded GM to build a sports car to capitalize on this interest; the finished product was the first Corvette. All 1953 examples were two-seat roadsters that had white exteriors with red interiors. Their fiberglass-reinforced plastic bodies set a precedent that GM would carry on through generations of Corvettes.

The introduction of the convertible edition comes relatively quickly after the July debut of the coupe. (It can take a year for automakers to pull the trigger on the “spyder” versions of their cars.) But considering the 66-year history of GM’s most-collected model, it’s an apt decision; when that first Corvette roadster debuted in 1953, it didn’t even come in an optional coupe form. A fixed-roof coupe version didn’t come until a decade later, when GM added it to the second generation of its wildly popular chrome-grilled, single-headlight cars.

A Necessary Risk

The 2020 Corvette, with the first-ever mid-engine placement of the line, is a huge risk for a company that has seen sales decline and has suffered recent labor disputes, because it plays such an important role. While the Vette accounts for just 4.7% of GM’s total volume of cars sold, it represents 11% of GM’s car retail revenue year-to-date, according to Kevin Tynan, lead automotive analyst for Bloomberg Intelligence.

Corvette has the highest retail revenue per unit for car nameplates at GM. With an average transaction price of $76,057 in 2019, the Corvette is by far the most expensive car GM sells, second only to the Escalade SUV in the entire GM portfolio. The convertible starts production by the end of first-quarter 2020, just three months after production begins of the coupe; it will certainly help augment early sales of the car.

But Corvette buyers are a notoriously aging demographic, apt to be even more discouraged by the fact that the new model—in a bid to emulate its European counterparts, attract younger drivers, and conserve production costs—does not offer a manual transmission. Corvette sales in the U.S. have declined in every quarter since 2016. In 2018, dealers sold just 18,791 of them, down 44 percent from 2015. At peak sales in 2006, Corvette sold 37,000 total units in the U.S. The brand hasn’t come near that number since.

Christopher Bonelli, a spokesman for General Motors, says he expects the convertible’s sales to account for more new Corvette sales in 2020 than it does currently—hopefully goosing the car’s bottom line. He declined to specify an exact percentage, but in recent years, convertibles have made up fewer than 20% of total Corvette sales. 

Collectors Prefer the Convertible

A bigger question for those relative few who are still excited enough about Corvette to spend the roughly $60,000 required to get one is how the open-top version will hold its value, long-term.

At the dealership, current models such as the Stingray, for example, come with deep discounts—never a good indicator for the strength of demand. The appetite for hot rods in general has shrunk to 2.3% of the nation’s total vehicle market, about half what it was a decade ago, according to Edmunds.

These are not nice realities for Chevrolet to face. But they won’t matter to the true Vette enthusiast, who might liken driving this excellent car to celebrating Independence Day every time they get behind the wheel. It’s difficult to overstate the amount of devotion the Corvette engenders, a feeling that, for many of its owners, mixes patriotic pride with personal freedom. And if you’re asking, you’re probably better served buying the convertible version. (That is, unless you can find a Stingray coupe that has never been driven.)

“Convertible Corvettes are typically worth more than their coupe counterparts,” says Jonathan Klinger, a spokesman for Hagerty Insurance Co. “Except for the 1963 split-window coupe, which has, on average, been worth 21% more [than the convertible counterpart], convertibles have been worth, on average, 13% more than their coupe versions.”

Corvette values at auction and in private sales vary widely, depending on the generation and model year. Generally, though, a convertible is a significantly better bet: For model years 1968-1975, the convertible premium has averaged 28% over coupes; from convertibles from 1986-1996, the convertible premium is, on average, 29%, according to Hagerty.

And unless you choose that famed split-window coupe from 1963, which can cost from $56,000 for entry-level versions in good condition to $386,000 for the Z06 “big tank” version, according to Hagerty, you won’t have to pay much for a good Vette at all. The values of the absolute best fifth-generation Vette in the world—the ones made from 1997-2004, for instance—don’t surpass $30,000.

Those from more recent years have brought near bargain-basement levels, though the open-top options will bring in a little more dough: A base-level 2000 Corvette V8 is worth an average of $16,300, according to Hagerty. (The car cost $3,498 when it first went on sale in 1953.) The convertible version of the same car is worth $17,600, on average.  And for the sixth-generation cars, those made from 2005-2013, the convertibles have averaged considerably higher values 25% better than the coupes.

Serious collectors will tend to amass convertible examples of earlier models, Klinger says, since they have been more tested on the collecting market over time. But the most important thing for interested parties is to buy what they genuinely like. A car just gathering dust in a garage isn’t fun for anybody.

Pricing on the entry-level 2020 Chevrolet Corvette Coupe starts at $59,995. The starting price on the entry-level convertible is $67,495. If you keep it long enough, odds are you’ll more than recoup the difference.

To contact the editor responsible for this story: Chris Rovzar at crovzar@bloomberg.net

©2019 Bloomberg L.P.