BMW and Daimler pledge to keep prices high when chip crisis ends

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42

Especially given the fact that any true coordination of production levels (OPEC style) will attract a helluva attention from regulators.

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Companies forget…

OPEC members = Governments
Car Companies = Not Governments

& even OPEC members can’t adhere to the quotas they agreed to.

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Edit: missed @jeisensc post. Duplicate point.

Of course. The idea that the the monetary policy of the Fed is what’s causing production shortages and increased prices in England and the eurozone doesn’t make any sense.

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45

I don’t know about the “cash only” part, but I think getting rid of lease programs would be a complete non-issue for people getting full-fledged AMG/Ms.

Agree. Genesis’s MSRP advantage was fairly meaningless b/f; not so now both for leasing and for financing, one presumes… It will actually be interesting to see how the Germans respond, at that point.

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46

Exactly. & if these manufacturers were really not going to budge on prices, the risk of reduced profit is even lowered as they can still raise prices & undercut the competition at the same time with the increased market share as the cherry on the top.

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47

I’m sure it was unnecessarily wordy just to make me sound smarter than I am.

I understand why people are looking for simple answers to complex problems, and there is some overlap between a couple similar problems; but correlation isn’t causation.

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48

let’s focus on profit

Right, so let’s limit the supply and hope people will pay sticker so we’ll make more profit? This is a million dollars question and only time will tell if it works or not.

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I wish the correlation between # of people drowning by falling into a pool and movies Nicholas Cage appeared in was stronger. Just seems weak at 66% in a sea of 90%+ correlations.

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“If you torture the data long enough, it will confess.” —Ronald H. Coase, Essays on Economics and Economists

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51

Although we (consumers) may not like it, they are running a business. If you don’t want to “over” pay for a Beamer or a Benz, I am sure Audi or any other brand would be happy to have your business.

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52

Correct, until of course BMW and MB want the business back…

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I was close to snagging a 5-Series earlier in the year (custom order), but I ended up leasing an A6. Penfed had $3k in incentives on top of the Audi lease cash. I could not say no. It is my second Audi. Had an A4 before.

As long as I can keep getting deals on Audis, I will keep driving them. If BMW or MB wants to offer me a better deal, I am all ears.

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54

Well doesn’t sound like they want your business :joy:

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FTFY…

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Incentives were non-existent. BMW’s Penfed certificate was only worth $500.

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Isn’t Kia/Hyundai already doing it? Add in the VW Chattanooga plant in 2022 cranking out VW EV’s, while Toyoda confesses JIT wasn’t really real?

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They are actually not undercutting them but actually raising prices to equivalent.

I don’t think Toyota did anything like that, they had the most buffer i think 6 months out but the chip shortage just outlasted their contingency.

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59

Where is Toy’s Electrify America equivalent? Where is Toy’s Palisade? They’re busy making excuses.

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I am curious why we keep talking about JIT and chips, my undergrad was in Industrial (imagery) Engineering though I never practiced it, but I remembered that was a hot topic even in the 80’s. But automotive chips are relatively cheap and they don’t need a lot of space to warehouse them so the holding cost must not be high, why would you apply JIT principles to chips?

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I’m not an expert on the pricing or the technical aspects of these chips but

Even the new age ones with all the new safety features relying on the cameras & radars etc?