Top Gear

[BOF]

The manufacturing methods will differ hugely from country to country. In the UK (and Germany, Italy, Spain etc.) the lines are heavily automated. In China they will be very labour intensive. The cost per unit will vary hugely.

You misunderstand. What I meant was, if 2 Renault cars are built in Turkey and one is subsequently sent to the Irish market and one is sent to the Portuguese market, both of those cars will leave the Renault factory in Turkey for very different unit prices.

Now obviously they both cost the same to build as they're both built in the same factory by the same workers on the same production line, but because of the different taxation in the destination countries, the unit cost (before tax) will differ greatly to both countries in order to keep the final customer price affordable. So it can not follow that a car is being sold in both Portugal and Ireland at close to cost, when it is being sold to the dealer in both markets at very different values.

[Genie]

The manufacturing methods will differ hugely from country to country. In the UK (and Germany, Italy, Spain etc.) the lines are heavily automated. In China they will be very labour intensive. The cost per unit will vary hugely.

You misunderstand. What I meant was, if 2 Renault cars are built in Turkey and one is subsequently sent to the Irish market and one is sent to the Portuguese market, both of those cars will leave the Renault factory in Turkey for very different unit prices.

Now obviously they both cost the same to build as they're both built in the same factory by the same workers on the same production line, but because of the different taxation in the destination countries, the unit cost (before tax) will differ greatly to both countries in order to keep the final customer price affordable. So it can not follow that a car is being sold in both Portugal and Ireland at close to cost, when it is being sold to the dealer in both markets at very different values.

Yes, I see what you're saying, I wa just making the point that it just wouldn't be possible to'shake up' the european industry to compete with china. The have a much lowe cost base for raw materials and labour.

[Xela]

They flock to Bicester for the brand names. A lot of the Chinese (and other Asian races) are obsessed with brand names. Its prevalent when you visit these countries. Thailand is very much the same. The girls who work in an office will often live in cramped accommodation with no air con, poor washing facilities etc but will happily splash 6 months wages on a designer handbag or an iPhone. Its gives them a lot of kudos/status amongst their peers.

[Stevo985]

Take it from me, we sell cars pretty close to what they cost to make!

The base cost of the same car differs hugely from country to country. Take Ireland & Portugal as 2 contrasting examples. To the customer, a car is cheaper in Portugal. But that includes all the taxes etc because Ireland screws you on tax. If you exclude the tax i.e. the cost of the car from the manufacturer to the dealer, then the car is actually cheaper in Ireland. This is because the manufacturer reduces the cost of each unit so that when VAT & VRT are applied to the final cost, the car will still be affordable to the consumer. I know that dealers sell quite close to the wire. A lot of my friends work in the industry. But the cost from the factory to the dealer? I'm not so sure. We'll find out soon enough I'd say.

You don't have to tell me this stuff

Point is, the markup we, the manufacturer, put on our cars is minimal. In Europe and the US anyway. In fact in the US, we make literally no money on Range Rovers and Range Rover Sports. We just sell them so that we can say we sell them (probably shouldn't tell you that)

JLR are making huge profits, driven HUGELY by the far east, and more so now India and Russia.

If the Chinese start making the same cars, for dirt cheap, and selling them to us, our ability to compete (on value at least) will be small. Merc, BMW etc will have better chance because of their huge size. But us? It'll be tough. We won't be able to rely purely on our Luxury image because that image will still exist, but at a lower cost.

Sure we can lower costs here and there, but not on that scale.

The idea that car manufacturers charge more because we can is way off the mark. We do that in China etc because we can, but definitely not the rest of the world.

[BOF]

I never said the correction would bring everything down to Chinese levels. I know that's not possible. But a correction would take place to lower costs to some degree. Anyway, we won't have to wait too long to find out. Though something tells me the European (or non-China) courts will be less sympathetic towards the blatant X5 ripoff and it's ilk if it ever tries to leave China

[Amsterdam_Neil_D]

I don't think I will recover from seeing a Maestro / Montego dna splice.

I know both of these cars very well and I actually was given a Maestro (VDP) for nothing once. This was the one that talked to you, I had it for 4 weeks:

I lost the metal sunroof on the Aston Expressway at 65 mph (or warp speed)

I lost something off the car almost every day.

The thing would not shut the F*** up.

The electric windows went down OK, but I had to push them up with my hand.

After 4 weeks the drive shaft fell into 2 pieces 40 metres from work, the people who gave it me so I pushed it back and gave keys in.

Montego 2.0l ( I drove about 10,000 miles in this for work) -

This was a massive car of epic proportions

It used about 4 litres of petrol to get to 5 th gear

I could turn the wheel 70-80 degrees before the steering kicked in.

The older it got the higher the suspension went.

It was a nice colour, hearing aid beige I think it's called.

It was surprisingly fast but id not like slowing down much, so much so it shook in an angry way if attempted too quick.

Those were the days.

[The_Rev]

At least it didnt have a square steering wheel.

[Amsterdam_Neil_D]

At least it didnt have a square steering wheel.

What was that car ? I drove one a few times, the wheel was kinda unforgettable......was it the big Rover 3500 VDP or something ?

Rover rings a bell, I have invented a square wheel sounds like Longbridge to me.

[The_Rev]

It was the Allegro. An utter turd of a car which did more damage to the British car manufacturing industry than almost any outside force? We never recovered from 15 years of badly designed poorly built vehicles under British Leyland.

[BOF]

Ahh the Allegro. Officially more aerodynamic going in reverse than going forward. With a truly epic turning circle. The British car industry... Seriously, when you remind yourself of what came out around that time via a google image search (when they weren't striking of course), they only ever had themselves to blame.

[Eames]

Ahh the Allegro. Officially more aerodynamic going in reverse than going forward. With a truly epic turning circle. The British car industry... Seriously, when you remind yourself of what came out around that time via a google image search (when they weren't striking of course), they only ever had themselves to blame.

Mum had two and swears they are/were good cars...... :shock:

[BOF]

I thought the Rover SD1 was a lovely car and a tidy Ambassador was alright but by and large they were all junk. I'm sure in isolation there were good examples of every car (even the Viva) and obviously they were being judged to a far lesser standard than today's cars, but ze Germans and the Japaneezers eventually knocked them into a cocked hat (and bought them), and here we are today.

[Stevo985]

I never said the correction would bring everything down to Chinese levels. I know that's not possible. But a correction would take place to lower costs to some degree. Anyway, we won't have to wait too long to find out. Though something tells me the European (or non-China) courts will be less sympathetic towards the blatant X5 ripoff and it's ilk if it ever tries to leave China

The ripoffs go even further than that.

We've seen cases where they've just made shitty cars, and whacked a Land Rover badge on it (or Jaguar)

That's even worse for us, because a lot of people over there don't know any better. Pretty damaging to the brand, especially when we rely on our luxury image so much over there.

Oh, and another word on the margin stuff, found out today (out of curiosity), in the US BMW make 45p profit on every £1 they invest in making a car.

JLR make....well I shouldn't tell you the exact figure. But let's just say if you divide that by 20 you're not a million miles away...

[BOF]

Well there you go. BMW are rife for a 'correction'. Or should we call it a Chinese burn

[Genie]

I wouldn't mind a correction at BMW

In seriousness though, JLR will probalby smash all its own records and produce aboutu 400,000 vehicles this year. BMW will produce closer to 1.5million. They have this massive margin because they're producing more vehicles per site than JLR and are able to drive down piece costs better with their suppliers.

[tonyh29]

talking of BMW this new ED 5 series has a Co2 rating of 119 and 62 mpg and a reasonable(ish) 0-60 in 8.2 secxs

for a company car driver paying their own private fuel and in the 40% tax bracket that comes in at £175 a month benefit in kind tax

can see that being a winner for them

[Genie]

BMW don't get very much wrong. Seems like everything they touch turns to gold.

[BOF]

And they produce the X6 just as the exception to prove the rule

[tonyh29]

and the X1

[BOF]

The X1 has at least got a semblance of a point to it. It's a more affordable version of the bigger crossovers. The X6 has no point. Actually I lie. It's point is to instantly identify total and utter cockends.