How much does a car actualy cost
Discussion
It's a fair chunk more than £1000.
I've heard £8k being bandied about for a Focus.
The key is that the price doesn't really go up much. 6000euros is apparently the difference in build cost between a vanilla Boxster and a fully loaded 911 Turbo. Staying on Porsche it was revealed during the VW take over that Porsche were paying 22k euros per Cayenne that VW were making for them.
I've heard £8k being bandied about for a Focus.
The key is that the price doesn't really go up much. 6000euros is apparently the difference in build cost between a vanilla Boxster and a fully loaded 911 Turbo. Staying on Porsche it was revealed during the VW take over that Porsche were paying 22k euros per Cayenne that VW were making for them.
CampDavid said:
I've heard £8k being bandied about for a Focus.
No way is a Focus anywhere near £8k to build.Most of the showroom price is made up a dealer margin. Advertising takes a fair wack too.
Having said that I may be getting confused with the profit the maker gets - which is definately in the £hundreds region for a shopping car.
skilly1 said:
Ignoring design, development, testing, tooling, advertising costs, how much does it actually cost to build a car to come off the production line? So include parts and labour only?
Take for example a bog standard Fiesta costing £10,000.
Cant possibly exclude tooling and running cost and just work off a parts and labour figure as that would make the figure incorrect.Take for example a bog standard Fiesta costing £10,000.
RJDM3 said:
skilly1 said:
Ignoring design, development, testing, tooling, advertising costs, how much does it actually cost to build a car to come off the production line? So include parts and labour only?
Take for example a bog standard Fiesta costing £10,000.
Cant possibly exclude tooling and running cost and just work off a parts and labour figure as that would make the figure incorrect.Take for example a bog standard Fiesta costing £10,000.
I was on a flight once and met a guy whose company made assembly lines.
At the time IIRC correctly something mainstream like a Mondeo cost £5k or something whereas a 3 Series was not much more - £7.5k?
Margin on the Bimmer was much higher, of course. Hence huge profits at BMW and Porsche, for example.
At the time IIRC correctly something mainstream like a Mondeo cost £5k or something whereas a 3 Series was not much more - £7.5k?
Margin on the Bimmer was much higher, of course. Hence huge profits at BMW and Porsche, for example.
The problem is, the question is too vague.
Do you mean the raw production cost to make one car (just the parts and the labour)
Or a fully loaded cost - ie, the proportional costs are included in teh manufacturing of:
R&D
Model development
Head office / HR / Finance costs
Training
End of life parts management
Marketing
etc
Will get you two vastly different costs but both equally valid; though the raw cost only is a misleading number, as it can't exist without the wider costs of development etc being taken into account.
Do you mean the raw production cost to make one car (just the parts and the labour)
Or a fully loaded cost - ie, the proportional costs are included in teh manufacturing of:
R&D
Model development
Head office / HR / Finance costs
Training
End of life parts management
Marketing
etc
Will get you two vastly different costs but both equally valid; though the raw cost only is a misleading number, as it can't exist without the wider costs of development etc being taken into account.
You can't really ignore tooling and end up with a fair or useful figure.
An anonymous gromit for a focus might have a piece cost of 5p, but the tool that makes it cost £1m. So you could price it at 5p, but the total you end up with is pretty meaningless.
Unless you're selling 100,000,000 focuses, in which case your price is 6p. (but your tool wore out long ago....)
An anonymous gromit for a focus might have a piece cost of 5p, but the tool that makes it cost £1m. So you could price it at 5p, but the total you end up with is pretty meaningless.
Unless you're selling 100,000,000 focuses, in which case your price is 6p. (but your tool wore out long ago....)
trickywoo said:
CampDavid said:
I've heard £8k being bandied about for a Focus.
No way is a Focus anywhere near £8k to build.Most of the showroom price is made up a dealer margin. Advertising takes a fair wack too.
Having said that I may be getting confused with the profit the maker gets - which is definately in the £hundreds region for a shopping car.
My reasonably educated guess is that mainstream cars are costing maybe 50-60% of their recommended showroom price to build. Once you knock off the dealer's small slice, transportation, tax and discounts, most manufacturers are around 5-10% profit per unit.
ETA - This being with tooling taken into account.
Edited by McSam on Thursday 27th January 10:39
t!CampDavid said:
It's a fair chunk more than £1000.
I've heard £8k being bandied about for a Focus.
The key is that the price doesn't really go up much. 6000euros is apparently the difference in build cost between a vanilla Boxster and a fully loaded 911 Turbo. Staying on Porsche it was revealed during the VW take over that Porsche were paying 22k euros per Cayenne that VW were making for them.
Porsche make as an average £14k profit on every single unitI've heard £8k being bandied about for a Focus.
The key is that the price doesn't really go up much. 6000euros is apparently the difference in build cost between a vanilla Boxster and a fully loaded 911 Turbo. Staying on Porsche it was revealed during the VW take over that Porsche were paying 22k euros per Cayenne that VW were making for them.
As above. Depends on the length of the production run - it must cost a billion or so to develop a new car, underlying components, tooling and the production line - and then those costs are shared between each car. At a guess £1bn / 50000 cars = £2k per car. Assuming a modern factory produces 100 cars per worker - then that's only £500 per car (assuming cost of employing a worker is £50k p.a.).
McSam said:
My reasonably educated guess is that mainstream cars are costing maybe 50-60% of their recommended showroom price to build.
You're close. It's just under half of the pre-tax price.McSam said:
Once you knock off the dealer's small slice, transportation, tax and discounts, most manufacturers are around 5-10% profit per unit.
The manufacturers gross margin is way higher than that. Net, once everything else has been taken into account, is much lower. It's complicated because of the way car manufacturers move cars around through different companies - ie you buy a car off a dealer who may be owned by the UK arm of the manufacturer, and then you get finance, also from another company owned by the manufacturer.
sleep envy said:
CampDavid said:
It's a fair chunk more than £1000.
I've heard £8k being bandied about for a Focus.
The key is that the price doesn't really go up much. 6000euros is apparently the difference in build cost between a vanilla Boxster and a fully loaded 911 Turbo. Staying on Porsche it was revealed during the VW take over that Porsche were paying 22k euros per Cayenne that VW were making for them.
Porsche make as an average £14k profit on every single unitI've heard £8k being bandied about for a Focus.
The key is that the price doesn't really go up much. 6000euros is apparently the difference in build cost between a vanilla Boxster and a fully loaded 911 Turbo. Staying on Porsche it was revealed during the VW take over that Porsche were paying 22k euros per Cayenne that VW were making for them.
Also, you can't ignore the initial costs, you just can't, the manufactures also take a gamble on the amount of units they will sell, break even point may be on 100,000 units sold, so no profit at all up to that point, by 200k units they are making maybe 20% and it might not be till they get to 1,000,000 units that they start to make a decent 50% profit. But then the profit goes into the development of the next car, so it is just a cycle that keeps everyone being paid and keeps people in jobs as well as pleasing the shareholders.
gizlaroc said:
sleep envy said:
Porsche make as an average £14k profit on every single unit
Porsche make more profit per unit than any other manufacturer though don't they??The £14K figure was from a few years ago when they had large one-off gains added to their bottom line.
Deva Link said:
McSam said:
My reasonably educated guess is that mainstream cars are costing maybe 50-60% of their recommended showroom price to build.
You're close. It's just under half of the pre-tax price.McSam said:
Once you knock off the dealer's small slice, transportation, tax and discounts, most manufacturers are around 5-10% profit per unit.
The manufacturers gross margin is way higher than that. Net, once everything else has been taken into account, is much lower. It's complicated because of the way car manufacturers move cars around through different companies - ie you buy a car off a dealer who may be owned by the UK arm of the manufacturer, and then you get finance, also from another company owned by the manufacturer.
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