Klaus From Germany, joined Jul 2001, 21346 posts, RR: 54 Reply 8, posted (7 years 2 months 6 days 17 hours ago) and read 9018 times:
American prices are without sales tax, european prices are usually including VAT. Warranties are different, standard equipment vs. added features may differ and the markets are very different. American car manufacturers have already almost ruined themselves by undercutting each other, so price pressure is higher.
LTBEWR From United States of America, joined Jan 2004, 12670 posts, RR: 13 Reply 9, posted (7 years 2 months 6 days 17 hours ago) and read 9018 times:
There are number of reasons:
Purchase Taxes: Most countries may have National sales taxes of 12-30% on cars. In the USA, the prices you see for cars do not include State sales taxes which may be none to 8.5%, but even at 8.5%, a lot lower than most countries.
Competition and advertising: The large number of brands and models available including imports and Foreign brand cars made in the USA along with heavy price advertising encourages lower advertised and Suggested Retail prices.
Lower labor costs: Yes, USA based, unionized companies have tremendous retirement benefits costs that most companies outside the USA and Toyota, Nissan and others don't have within the USA (not UAW plants). We have much more labor flexibility than in the EC. BMW operates a non-union plant in South Carolina so 3-series models will have much lower labor costs than when made in Germany.
Lower component cots. We have more flexibility with outside suppliers of major and minor parts, and including their manufacturing in Mexico, Brazil, China, elsewhere in Asia so lower costs there.
Dealer competition: Within the USA, there is a lot of competition from dealer to dealer for each brand of dealers or of competing brands and models. Except for models in limited supply and high demand, almost all cars are sold below Suggested Retail prices, so lower costs as well. In the EC, you don't have as many dealers, less shopping around for price.
CPDC10-30 From United Kingdom, joined Feb 2000, 4761 posts, RR: 25 Reply 13, posted (7 years 2 months 5 days 17 hours ago) and read 8853 times:
Quoting Klaus (Reply 8): Warranties are different, standard equipment vs. added features may differ and the markets are very different.
As in the European warranties are much skimpier..at least they are in the UK. I've seen cars with 1 or 2 year warranties, in North America there are very few that don't give at least 3 years comprehensive and 5 years powertrain warranty.
However, it is true that for example ABS is standard on even small European cars whilst it remains optional in North America for the lower end models.
Although new cars are expensive, I find that used cars in the UK are quite a bit cheaper than in Canada...mostly because of the high fuel prices and road taxes that encourages newer, more efficient cars.
Adh214 From United States of America, joined Sep 1999, 353 posts, RR: 0 Reply 15, posted (7 years 2 months 5 days 15 hours ago) and read 8810 times:
You are on the wrong path talking labor costs, taxes, fees, etc.
Pricing of cars has little to do with what they cost to produce and everything to do with what the seller thinks they can get.
The net net of this is:
BMW does not think they can get $47,000 for a BMW 3 series in the US. Since very very few Germans will come to the US to buy a BMW, they can price differently in different markets.
Since, I was recently in the market for a car, believe me BMW would have a very hard time selling the 3 series for $47,000. We have too many other cars competing with it such as Lexus, Mercedes, Infiniti, Acura. All of these makers have similar cars available for between $30,000 and $40,000 that compete directly with the BMW 3 Series.
DeltaGator From United States of America, joined Sep 2005, 6341 posts, RR: 14 Reply 16, posted (7 years 2 months 5 days 7 hours ago) and read 8753 times:
Along the same vein I have a question about the Honda Odyssey. I bought my wife one a month or so back and I got a 2006 for about $27,000 USD (no leather unfortunately.) The reason I ask is because I saw new Odyssey's in Australia and Singapore that were much smaller than ours (perhaps based on the Civic instead of the Accord like ours) and when I looked up the price in Singapore they were $100,000 SGD which is about $70,000 USD. What gives with that? Why the huge price differential for a smaller car with the same name?
Quoting 777DadandJr (Reply 11): I believe that the Z3 was, now the Z4, and the X5 are built in SC.
You are correct. IIRC they are going to expand the plant even more and build a few more model lines there. As a side note the SC Highway Patrol got a bunch of unmarked 5 series as part of the incentive deal to bring BMW to the Upstate.
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Checkraiser From , joined Dec 1969, posts, RR: Reply 17, posted (7 years 2 months 5 days 7 hours ago) and read 8747 times:
The price difference is insane. I bought a new Volvo S60 T5 in 03 and paid $30,850. The same car sold in the UK for a pinch under $50k.
Labor may not be as big of a driving force - but I think Europe's high taxes definately play a part.
Another reason to toss into the equation could be higher dealer costs. A dealer in Europe pays more for everything, from labor to land.
Competition is likely the biggest force at work though. As pointed out earlier, you're never going to sell a 3 series for $47k. While a lot of US/Canadian posters on this forum constantly blast American cars, the fact is their quality has improved drastically over the past five or ten years.
UTA_flyinghigh From Tunisia, joined Oct 2001, 6495 posts, RR: 51 Reply 18, posted (7 years 2 months 5 days 3 hours ago) and read 8709 times:
Quoting DeltaGator (Reply 16): The reason I ask is because I saw new Odyssey's in Australia and Singapore that were much smaller than ours (perhaps based on the Civic instead of the Accord like ours) and when I looked up the price in Singapore they were $100,000 SGD which is about $70,000 USD. What gives with that? Why the huge price differential for a smaller car with the same name
Singapore is a bit of an exception in Asia, huge taxes are levied on personal transportation in order to promote mass transportation.
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57AZ From United States of America, joined Nov 2004, 2550 posts, RR: 2 Reply 21, posted (7 years 2 months 4 days 3 hours ago) and read 8535 times:
Don't forget that many people do not consider the operating cost of the vehicle. Kind of like having an airplane-you have to add the cost of servicings, fuel and insurance to the purchase cost. Fuel doesn't vary significantly from location to location but the insurance does. Moved to Arizona from Tennessee and the insurance rates tripled. In Tennessee I could literally carry commercial vehicle insurance on THREE Jeep Cherokees with the premium payment I pay on my Jeep here. Of course, the risks here are different than in Tennessee-thus the extremely high premium.
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