I don’t know if anyone told the motoring industry in South Africa that there is a recession out there but something seems horribly wrong with this group of people. The statistics are in, car sales are down by around thirty percent month on month from the year before but yet still no one in the motoring industry is getting the message. I think I’ve worked the issue out here. It’s a very subtle problem and it’s taken me many, many hours to work this one out. I hope most people are not overly shocked by this realisation but here it is:
Cars cost more money than people can afford
Lets take a look at the numbers here. A new Golf 6 costs R214400 for a 1.6 liter engine with no extras. Now if you add something such as a GPS built into the car (which costs around R2500 if you go down to the local computer store) it costs a ridiculous R28,290. I think this is a minor indication that the people that set car prices, are clearly off their rocker. How on earth can a GPS cost nearly thirty grand? The price for the current range topper, the 2 liter diesel, is R298000. Now considering the nearly ninety thousand rand difference you’d expect some extra’s thrown in such as leather seats or something for your trouble? Nope, the only difference is the two grand cruise control. Considering the diesel is the same as in the previous generation Golf, surely it should be cheaper since there were no development costs?
Do I not understand how these things work or someone is getting horribly ripped off.
Seriously though, who the hell has three hundred grand to spend on a hatchback car? It’s an absolutely ridiculous amount of money in this day and age. Using the three hundred grand analogy you’ll need to pay over six grand a month for 54 months to afford this car. I don’t know anyone who, at the age of 24 could comfortably afford that without not living in their parents basement. That’s a lot of cash and the simple logic is this: imagine if you charged less for cars and then maybe you’d sell more of them? I’d love to know the profit margin on vehicles as it must be totally ridiculous. I say ridiculous purely because the current Golf 6 is supposedly cheaper to build than the outgoing Golf 5 yet it costs a substantially larger amount more.
Guess I don’t get how the world works.
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Great post, but poor example. The Golf 6 is hopelessly overpriced all over the world. Becasue they know that people will buy it because people like Golfs.
But agreed. Despite the mess that the car industry is in worldwide, the prices are a joke. And their excuses are terrible. They’re doing themselves no favours.