Chrysler 200

Pricing In The Automotive World Is All Wrong

Chrysler 200

The Chrysler 200 at the New England International Auto Show

This weekend the New England International Auto Show came to Boston, which if you haven’t attended, make a note of it for next year because it’s great for the entire family and well worth the experience. Auto shows give the consumer access to cars from an array of different brands so they can compare them in terms of price, comfort, and options in real time and in person instead of comparing them online. As a student of business and marketing, and also being financially aware, I took notes on the prices of some of the cars and their brands. Needless to say I was stunned at the findings.

When it comes to buying a Hi-Definition television, you’re already aware of the fact that you’ll be spending more when you look at bigger screens. With furniture, you know that leather seats will cost more than other materials. You also know that if you want a powerful gaming computer or laptop, you’ll be spending top dollar as opposed to the typical laptop that comes with standard specifications and options. So then why can’t the auto industry be like the rest of the product related markets?

High quality brands sell, that’s just fact. People are going to buy cars from Mercedes Benz, Audi, and BMW before others. So why is a fully loaded Chrysler 200 the same price as Mercedes Benz CLA or well equipped Audi A3? We can argue that some consumers have certain preferences and tastes, but to buy a car that’s priced as a luxury car that really isn’t will undercut sales for these companies in the long run. I’m sorry, but Chrysler and Buick are just not going to compete with the Germans, they can’t. The sales figures are overwhelmingly pointing to consumers choosing foreign cars over domestics, but still American brands continue to fight an uphill battle.

While there are companies like Chrysler and Buick who are trying to be something they’re not, Infiniti and Lexus are paving their own path that separate themselves from the Mercedes Benz’s of the world and continue to march to the beat of their own drum. While their prices are in the range of Audi and BMW, their cars don’t resemble what’s coming out of Germany.

In the hatchback market, Volkswagen continues to thrive off their Golf and GTI line, but consumers have other choices that are more affordable and practical. A fully equipped GTI will set you back close to $32,000, while a fully loaded Kia Forte Hatchback is priced at $25,000. Most consumers will buy based off horsepower and performance, but when it comes to legroom and comfort, the Forte gets the point.

The last observation from the car show is GM’s brands competing against each other, which is something Buick is trying to end by introducing cars made by the German automaker Opel. Chevrolet always seems to take a model from Buick or had taken similar concepts from other GM’s subsidiaries and sold them cheaper, undercutting Buick’s, Pontiac’s, GMC’s and Saturn’s sales. Cadillac is moving in their own direction, and by moving headquarters to New York they’ve separated themselves from Detroit and GM.

In the final analysis, all the car companies are manufacturing top quality cars for every type of consumer. Unfortunately because of that, most car brands are all competing for the same market instead of dominating a market that they’re good at and can sell many cars without much competition.

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