Does DJI lose money on DJI Care

[stratos]

well, now you know how insurance work.
They work on risk knowing that most of the people will never use the service, and no they dont loose money, completely on the contrary.

 

[Warlord13]

I can only hope that at the end of a year my $99 Care Refresh plan is still sitting unused on the shelf! I would prefer that DJI got to put the money in the bank rather than crash my Mavic and have it replaced with somebody else totaled but repaired bird. At least I'll know what condition mine is in at the end of the year. Care Refresh is cheap insurance in my opinion.

 

[pjd900]

Can you point me to that?
I read the thread and all I see are a lot of guys talking about the clauses in the DJI refresh saying that you may get back a used Mavic or a new one. So far every single return I have heard about involved the person getting back a brand new Mavic. I would love to see the post and the pictures of one that was sent from DJI with scratches and an already registered serial number.

Just need to vent. Horrible CS

 

[pjd900]

Curious to read about it, too.

And is the buzz online about the program similar to the online phenomenon, "I only write about something to complain". Maybe this is a small proportion of claims? I guess we'll never truly know unless DJI tell us themselves.

Just need to vent. Horrible CS

 

[finalfantasyfans]

If you think DJI loses money on DJI refresh care, what about StateFarm insurance which offer full refund($1299) without trading in the drone for $60 only?

 

[adiru]

If you think DJI loses money on DJI refresh care, what about StateFarm insurance which offer full refund($1299) without trading in the drone for $60 only?

Statefarm will drop you after the first claim.
DJI will send two new Mavics, or so they say.

 

[iride4u]

Lets look at costs from a manufacturers point of view. If you take a normal mark up the cost of a Mavic to a retailer would be $500.00.
So with a base Mavic package you have a drone and the controller. With Refresh you only send in the drone. So you remove the cost of the controller at $200.00 this would leave the cost of a new bird at under $300.00. If you figure 1/4 of the people that get Refresh use it then DJI is coming out ahead but the customer is also happy.
I bought Refresh with my bird and hope that I never have to use it.
My cost for repairing a crashed Typhoon H was around $200.00 with a broken landing gear and a broken arm plus a bunch of smaller parts.

 

[dewster]

I guess someone did some math. It could be based on the amount of sales and the ability to track drones still in use by consumers. I think it's amazing. Either that or they have complete confidence in their technology keeping flyers out of trouble.


Sent from my iPhone using MavicPilots

 

[Robbyg]

Just need to vent. Horrible CS

Thanks, I am still wondering if that guy was just a one off case. Until I hear a few more stories I still think that DJI is basically still giving people new drones. I expect that to change as soon as the market gets saturated and they start retooling the factories for the Mavic 2. At that point I am sure the policy will definitely be shifted towards rebuilding old units and stocking them separately for exchanges.

 

[adiru]

I guess someone did some math. It could be based on the amount of sales and the ability to track drones still in use by consumers. I think it's amazing. Either that or they have complete confidence in their technology keeping flyers out of trouble.


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this is not making me too confident at the moment

https://i.imgur.com/z1cldWd.jpg

 

[AlanTheBeast]

LOL I was thinking the Opposite of the OP. How much money is DJI raking in with DJI care

AlanTheBeast in his post above lays out most of it. So keeping in mind that a $750 Mavic most likely cost DJI about $500 to produce. The main expense is the two main board inside the unit and in about 80% of the crashes those seem to be fine so they just get dumped back onto the assembly line were they are tested and inserted into a new drone. The second costly part of the Mavic is probably the Camera and Gimal. Those are probably always rebuilt at a special division of the company. The Plastic parts are probably in total a $20 cost and that's the parts that are most often damaged.

It's a win win for DJI because most most people will never use the refresh and those that do are most likely returning an item that they can salvage the expensive bits from and throw away the cheap stuff.

Actually, by my guess, the MP costs DJI $250 to get to the factory door. That's a rule of thumb that fits pretty much all consumer electronics coming out of China.

The only hedge I'd add to that is that the MP design criteria to engineering may have been: "do whatever it takes as long as the US retail price is $999 and you have permission to lower the margin because we're facing GoPro soon." So maybe the DJI cost is closer to $333 per unit. Still, a fraction of what we pay at the gate.

 

[AlanTheBeast]

Hmmm, let me do some back of the hand gorilla maths .......

..... there is absolutely no way it costs the world's largest drone manufacturer $500 to mass produce 1 unit. I know it's not an equal comparison but when I build a drone the retail cost for components amounts to $200-$300 depending on features (GPS, etc). And yes, I get that I didn't develop an app, or design a drone that's even remotely similar in specs as the Mavic Pro but the costs of the individual components are almost always less than $30 each (Edit: $30 retail, might I add).

Actually, I might look into this a bit more and write an article haha

Your $200-$300 averages to $250. Common rule-of-thumb is that the manufactured cost is about 25% of the US retail price for manufactured electronics. This doesn't account for "strategic pricing" that DJI may have wanted to use ($999) as a push back to the soon to be released (at the time) Karma.

 

[AlanTheBeast]

Statefarm will drop you after the first claim.
DJI will send two new Mavics, or so they say.

They'll send you "new or equivalent to new" - that means out of all those MP's coming back they are salvaging the expensive stuff for the Care Refresh. To be sure some people will get completely new kits - others will not.

 

[PropPilot]

Another viewpoint

I received the terms and conditions email from DJI yesterday for refresh for a second Mavic that just shipped. DJI states that the refresh program is underwritten by an insurance company. In that case, they would have a fixed cost associated with the offering and would not have to accrue warranty costs for Mavvies coming in under this program.


Flying a Mavic Pro with an Acer Iconia One 7" tablet running latest Android OS

 

[AlanTheBeast]

Another viewpoint

I received the terms and conditions email from DJI yesterday for refresh for a second Mavic that just shipped. DJI states that the refresh program is underwritten by an insurance company. In that case, they would have a fixed cost associated with the offering and would not have to accrue warranty costs for Mavvies coming in under this program.

Thanks for that.

Comes to: they've laid off risk and pay an ins. premium for it. Now you know they're making a profit on the $99 as well as the deductibles of $79 and $129! And so is the underwriter!! If the underwriter pays out too much the premium will go up and so will the CR fee and the deductibles.

Warning: Quibble ahead.
Warranty is (usually) a separate cost item built into the retail price.

 

[MavicFrank]

I think the key to this is the fact that you are sending back a drone that has some percentage of working parts. A parted out drone is worth more than a newly purchased drone. Look on eBay, lots of folks have made this their business model. Now I doubt seriously that DJI is reselling those parts, but I wouldn't be surprised at all if they weren't using them for refurbishing. It just makes sense as it lowers the cost of repairs significantly.

 

[AlanTheBeast]

I think the key to this is the fact that you are sending back a drone that has some percentage of working parts. A parted out drone is worth more than a newly purchased drone. Look on eBay, lots of folks have made this their business model. Now I doubt seriously that DJI is reselling those parts, but I wouldn't be surprised at all if they weren't using them for refurbishing. It just makes sense as it lowers the cost of repairs significantly.

I don't think their model would work if they weren't salvaging parts.

 

[integlikewhoa]

Some of these maybe older posts but I still like how a bunch of people think DJI Refresh means only "new" or "Brand New drone". And they keep using the word "NEW" every time they post about refresh. I paid for refresh myself and hope and think I will probley not end up using it, but who knows at this point. I'm not the best flyer but have racked up a ton of flights and miles in the last few months so maybe my confidence is a bit to high now.

But I know the chances of getting a "BRAND NEW MAVIC" off a refresh are probley not so great and might even have to do with whats in stock at the time. I have read many posts saying the same thing that they go back someone elses drone not theirs and not a new one.

 

[tpop24]

It doesn't have to be "brand new" but it should have a new appearance. I've gotten referbs from other companies and it's impossible to tell a difference from new. They should clean it up, reset all data and repackage it like new so it at least looks and feels new. Presentation means a lot.

Sent from my SM-G920V using MavicPilots mobile app

 

[MavicFrank]

It doesn't have to be "brand new" but it should have a new appearance. I've gotten referbs from other companies and it's impossible to tell a difference from new. They should clean it up, reset all data and repackage it like new so it at least looks and feels new. Presentation means a lot.

Sent from my SM-G920V using MavicPilots mobile app

I agree with this and it's why I bought the plan. I mean, if I want a hack job, I'll buy the parts and repair it myself.