Why so expensive?

[Small_Fryz]

Why is the price difference so vast?

BMW M5 here is 240,000 AUD or 215,000 USD

When the RRP in USA is only 82,000 USD.
2.5 times more expensive!! WTF

Same can be said for 911 GT3 and many other European luxo's.

i just dont understand.

 

[GT Pro]

It was only about 3 months ago that I posted the same question.

You know what is really screwed up?

Our home-grown car (Holden Commodore) cost more here than it does in the U.S (Pontiac G8). Enough said.

I'm fed up with it too, as the disparity seems to increase despite the fact that our dollar is coming ever the more closer to the U.S. Atleast it's a good excuse to go and live in the U.S of A. 👍

 

[the Interceptor]

Well, I think it's mostly import taxes and the market that set a cars price. You'd expect the M5 to be pretty cheap in Germany, as BMW is a german company. However, the german car market has pretty high standards, the prices are pretty high as well.

The M5 comes at a price of 92,500 Euros. That equals 134,135 US$ and 149,870 AU$, according to current exchange rates. That's much more than in the US, but still significantly less than in Australia. Why cars are so expensive down there is unknown to me ... maybe Google helps. What about local cars though, like Holden or models from the Asian market. They are cheaper, right?

 

[Casio]

As I said in the other thread.

In Australia the 'Luxury Car Tax' kicks in at $57,123 for imported cars. The tax rate is 25% on every dollar over $57,123. Then when you get into big dollar cars, even the 2-5% stamp duty can be $20,000 - $40,000 depending on the vehicle. Put another 10% GST on, etc, etc, etc....

It's also just due to the general economy I guess. I don't know how it works, but something must stop say Dodge Australia from buying cars from the US at about the quarter of the price, and selling cars here for half the price of competitors. The government would stop that instantly anyway.

 

[Small_Fryz]

So what would be the price break down according to your post casio on a 240,000 M5?

 

[Casio]

So what would be the price break down according to your post casio on a 240,000 M5?

Why I'm doing this at 2am I don't know.

For a start, in Germany (from what I can tell from the german site), the M5 goes for about 90,000 euros, which approximately 150,000AUD. So we'll start from that.

Transport here would be quite considerable. I ordered a 50gram T-Shirt from the states last week and that cost me 25$. So that'd have to factor into the price somewhat.

Then you have stamp duty, which on a 150k-200k car is going to be an extra 5-10k in most states.

Then again, the luxury car tax on top of that, so on a 250k car, you've have 200,000$ worth of value taxed 25c to the dollar. or 50k.

Then you have the GST. Which is another 10% on top of that.

Finally of course there is the supply and demand. I can't find the latest figures, but in 2000 BMW sold over 20,000 M5s in the states, and I'd think that figure would be even more now. Audi who as far as I know hold a greater market share than BMW here sold 7,227 cars AS A WHOLE. If BMW M5s sold in the number here as they did in the US every third car would be a BMW M5. With less numbers selling, obviously dealers need to retail the cars more to make more profit out of them. A dealer in the US selling 100 M5s a year, can afford to mark up his cars a lot less than an Australian dealer selling 5.

Of course all the cost of testing for ADR compliance, and conversion to RHD and all that other stuff.

 

[YSSMAN]

You know what is really screwed up?

Our home-grown car (Holden Commodore) cost more here than it does in the U.S (Pontiac G8). Enough said.

As I recall, the exchange rates and the understanding of the tax codes ends up putting the prices of the cars (Commodore SS vs G8 GT) at about the same $30K-ish price tag in American Dollars. So its not all that different... Thank your government for making things more expensive with your taxes and such.

 

[Diego440]

even funnier:

Levi's Jeans in the US: Between 28 and 36 dollars... although some models can go up to around 60 dollars (US)

Levi's Jeans in Europe: Rarely will you find them below 60€ = 90 dollars.

Polo shirt from Gap: $6
Polo shirt from Zara (similar to Gap): 35€

 

[TheCracker]

even funnier:

Levi's Jeans in the US: Between 28 and 36 dollars... although some models can go up to around 60 dollars (US)

Levi's Jeans in Europe: Rarely will you find them below 60€ = 90 dollars.

Polo shirt from Gap: $6
Polo shirt from Zara (similar to Gap): 35€

How long is since you lived in the US?

Looking at GAP's website, a Polo shirt averages $30 - where as you'd probably pay £20-25 in the UK for the same item. Zara in the UK at least, i've found to be even cheaper.

 

[superberkut]

A hat in Norway: 550 krones (I think), or $110 CAD
The same hat in Canada: $40-50 dollars

Simply put, import taxes are huge for clothing, and seeing that Australia is a long way from the producing countries, the prices will naturally be high, also considering the country's geography as a possibility.

 

[Keef]

One of the reasons things are cheaper here is because tons of people are going to buy it. There's surely many, many times more M5s on the road in the States than in Germany, or any other European country. Plus, Americans hate paying out the ass for stuff, so the cheaper it is the more they'll sell.

 

[YSSMAN]

Quite right: I work at Steve and Barry's, litterally everything in our store is $8.98 or less. These really aren't crappy clothes either, we have brands that are ran by Sarah Jessica Parker, Amanda Bynes and Venus Williams, and the stuff just flies off the shelf.

Low overhead costs keep prices down, and its the key to success. We tried doing everything $14.98 or less, but it just didn't fly. Sales were down pretty consistently.

 

[Azuremen]

As I recall, the exchange rates and the understanding of the tax codes ends up putting the prices of the cars (Commodore SS vs G8 GT) at about the same $30K-ish price tag in American Dollars. So its not all that different... Thank your government for making things more expensive with your taxes and such.

Yup, government regulations and taxes.

See, you do pay for all those wonderful socialist perks many like to tout, like healthcare and the likes.

Honest.

 

[Casio]

Quite right: I work at Steve and Barry's, litterally everything in our store is $8.98 or less. These really aren't crappy clothes either, we have brands that are ran by Sarah Jessica Parker, Amanda Bynes and Venus Williams, and the stuff just flies off the shelf.

That's crazy. I've never paid under 10$ for an item of clothing. Ever.

 

[Azuremen]

That's crazy. I've never paid under 10$ for an item of clothing. Ever.

I generally won't pay over $25 for something. My cargo khaki's cost $20 I think, and most of my shirts are $10 to $20 dollars. Some of my nicer clothes have been about $40 for decent slacks and about the same for a fairly nice button up shirt. My blazers and sports coats all run about $80 dollars I think though, but those are items you keep for a good while.

Basically, blame your government.

 

[Casio]

Basically, blame your government.

I'd like to but they pay for my College, and pay me for going to College.

But, I guess it's how much you're willing to pay, and like cars, if idiots like me will shell out 150$ for a pair of jeans then they'll keep charging it.

 

[the Interceptor]

One of the reasons things are cheaper here is because tons of people are going to buy it. There's surely many, many times more M5s on the road in the States than in Germany, or any other European country. Plus, Americans hate paying out the ass for stuff, so the cheaper it is the more they'll sell.

Unfortunately I couldn't find any figures about the M5, but I found some about the overall sales of BMW cars:

http://www.bmwgroup.com/e/nav/index...porate_news/news/2008/Umsatzmeldung_2007.html

The USA remained the largest single market for BMW and MINI cars in 2007. With a sales volume of 335,840 units (2006: 313,603 units /+7.1%), the BMW Group sold more vehicles there than ever before. On top of this, BMW was the most popular European premium brand among US customers in 2007. In total, 293,795 BMW brand cars (2006: 274,432 units, +7.1%) were sold in the United States, making it the most successful European car brand on the US market in 2007.

Germany is the second largest market in volume terms, with 284,523 new registrations of BMW Group vehicles (2006: 296,930 new registrations). As a result of the higher value added tax rate and the uncertainty caused by the on-going CO2 debate, it was not quite possible to match the previous year’s high level. With a 4.2% decrease, the BMW Group nevertheless performed significantly better than the German market as a whole (-9.2%).

(I apologize for the dry marketing babble, but that's the way they are )

The figures for the USA and Germany are quite close together. As the price difference is equal for all the BMW models (not only the M5), selling more units in North America doesn't seem to be the reason for the lower prices.

 

[Sureboss]

I generally won't pay over $25 for something. My cargo khaki's cost $20 I think, and most of my shirts are $10 to $20 dollars. Some of my nicer clothes have been about $40 for decent slacks and about the same for a fairly nice button up shirt. My blazers and sports coats all run about $80 dollars I think though, but those are items you keep for a good while.

Basically, blame your government.

So a government has to set prices for items?

Also, salary should be taken into account. I'd imagine that the average Aussie wage is higher than the average American wage.

 

[Azuremen]

So a government has to set prices for items?

Also, salary should be taken into account. I'd imagine that the average Aussie wage is higher than the average American wage.

Governments have regulated imported goods for along long long time. England does much the same thing as well. Its generally in an attempt to protect domestic business.

Its generally done with a variety of taxes and tariffs.

BTW, with current exchange rates, the average Australian household makes, from what I can tell, several thousand dollars less than a US person. So thats shot down. Same with the UK compared to the US. Only Switzerland ranks higher from what I can find.

 

[YSSMAN]

That's crazy. I've never paid under 10$ for an item of clothing. Ever.

It really is nice clothing, but personally speaking, I only buy the shirts we sell. I'd happily pay the extra cash for a $25-30 pair of Levi's that fit me much better and last a lot longer.

 

[Diego440]

That's crazy. I've never paid under 10$ for an item of clothing. Ever.

I buy almost all of my clothes at Gap and Old Navy... polo shirts are around 6-10 dollars.

 

[Dave A]

I generally won't pay over $25 for something. My cargo khaki's cost $20 I think, and most of my shirts are $10 to $20 dollars. Some of my nicer clothes have been about $40 for decent slacks and about the same for a fairly nice button up shirt. My blazers and sports coats all run about $80 dollars I think though, but those are items you keep for a good while.

Basically, blame your government.

A nice suit costs quite a bit over that doesn't it. What will you wear if you ever get married. Tracksuit and Hush Puppies, you'll have to spend a bit them.

My work suit cost me £220 which is roughly $440 and my special occasions suit cost nearly twice that but I'm generally not a high spending person when it comes to cloths. If I look smart and tidy then I'm happy regardless of the brand or price tag status. Besides that you don't get much change from £200 just buying general going out clothes if you are big brand happy.

 

[///M-Spec]

So a government has to set prices for items?

Also, salary should be taken into account. I'd imagine that the average Aussie wage is higher than the average American wage.

If you do a straight up median household income comparison, the US and Australia are about even.

If you apply a concept such as PPP (purchasing power parity) to per capita GDP, it isn't even close.

Here's a list of countries by GDP PPP per capita from a variety of sources. This US per capita GDP is consistently ranked higher than Australia, with Luxembourg and some of the smaller Gulf States trouncing them both.

GDP (PPP) is not precisely the same thing as net personal income, but is close enough for comparison's sake.

More info on US income here: http://en.wikipedia.org/wiki/Household_income_in_the_United_States


M

 

[Casio]

BTW, with current exchange rates, the average Australian household makes, from what I can tell, several thousand dollars less than a US person.

And most Australians are paying 30% between and 45% income tax.

 

[Azuremen]

And most Australians are paying 30% between and 45% income tax.

I believe the figures I collected is gross income, so before taxes are considered. Its hard to tell because every nation has different ways of reporting information.

A nice suit costs quite a bit over that doesn't it. What will you wear if you ever get married. Tracksuit and Hush Puppies, you'll have to spend a bit them.

My work suit cost me £220 which is roughly $440 and my special occasions suit cost nearly twice that but I'm generally not a high spending person when it comes to cloths. If I look smart and tidy then I'm happy regardless of the brand or price tag status. Besides that you don't get much change from £200 just buying general going out clothes if you are big brand happy.

When I married (yes, I've been married already, and divorced too!) I simply rented most of it.

Nice suits do cost between 200 to 400 USD, but I certainly do not need to be buying those often. I can put together a good business casual look for about 80-120 USD, including shoes, belt, tie and sports coat. I've seen decent made sports coats for 40 USD.

Now, if you want some brand name high and mighty suit, except to spend thousands of dollars. But thats hardly the standard in business around here.

 

[Dave A]

When I married (yes, I've been married already, and divorced too!) I simply rented most of it.

I walked into that one eh.

 

[YSSMAN]

Now, if you want some brand name high and mighty suit, except to spend thousands of dollars. But thats hardly the standard in business around here.

...One recalls a trip to Louis Vuitton and having a look at a nice suit that was tagged for $2500, exactly what I had just paid for my '96 Jetta at the time...

Personally speaking, I'm willing to pay a premium for some stuff. I shop at Armani Exchange on occasion, $50-70 for a nice shirt never seems too outrageous. Depends I guess. I know people who spend $300 on a pair of Polo jeans, I can't fathom that.

When I can get two nice tee shirts (Colleges, Brands, Events) for $11 at work, a pair of Levis for $25 at Macy's, a pack of underwear for $10 at Target, and a really nice pair of shoes for $50 at DSW... Yeah, it feels good getting a pretty flexible outfit together for less than $100. The only time I ever pay more for a tee shirt is if I go to Hot Topic ($20) or a concert ($20-30)...

 

[Casio]

It's really personal choice when it comes to expensive clothing, though if you've got the money to spend why not? Like I said, I've spent over 150$ on Jeans, but many people will spend $2000+ on a set of rims for their car, which I can't fathom.

 

[GT Pro]

Clothing is expensive here for all I know. A decent set of jeans retails for a minimum of $70, a shirt $45-65 (depending on the material), a jumper/jacket to keep you warm $70 and shoes $100. Just one set of good clothes will set you back roughly $250-300, which is why I only have about 2 sets of clothes.

 

[ROAD_DOGG33J]

Clothing is expensive here for all I know. A decent set of jeans retails for a minimum of $70, a shirt $45-65 (depending on the material), a jumper/jacket to keep you warm $70 and shoes $100. Just one set of good clothes will set you back roughly $250-300, which is why I only have about 2 sets of clothes.

If you compare it to the cost of an old GTR, it doesn't seem like much.