Re: Price fixing among manufacturers

The cost of building a vehicle depends on the drive type and the amount of materials as well as the assembly line time to put it all together. Contrary to what many believe it costs more to assemble a FWD vehicle than a
RWD vehicle of the same size because of the off assembly line pre assembly required for FWD vehicles When Chrysler first began building small FWD cars they sold for as much or more than they larger RWD car they replaced. The line worker putting a front fender get the same pay, regardless of the MSRP of the vehicle. Material cost are by weight. When I was still at Ford in the mid eighties the cost of building a T-Car over a CV is less than $2,000 dollars yet the T-Car sold for $10,00 more. The cost a building a V6 Camry today is not much less than a V6 Lexus built on the same body. Toyota spends far less then GM on building their cars let a comparable Toyotas in size and equipment sells for 20% more. The fact is those that buy larger cars and trucks are subsidizing the sales of smaller cars, by keeping the MSRP down so that companies can met CAFE. If it were not for the greater profits earned by lager cars and trucks the price of small cars would be thousands more than they are. Look at Toyota, ALL of their growth over the past ten years has been in lager cars, SUVs and trucks, not in small cars. Toyota knows American buyer prefer larger save cars ant that has been what they are building. Today Corolla in larger than the first Camry but buyers buy more Camry than todays larger Corolla
When GM introduced the Saturn line of cars they set up an entirely new network to build and sell the vehicles. The reason was to determine the true cost of building a small car in the US and still earn a profit. GMs economies of scale were so low they could not determine the true cost of any of their brands.
When they teaching economies in colleges Procter and Gamble and Bethlehem Steel are two companies that are referenced in teaching economies of scale.
When Procter and Gambel fist developed detergents to clean close they based the selling price on the cost of making Duz Soap. When they stopped making Duz they discovered the same economies of scar did not transfer to detergents. Bethlehem steel made the finest Tool Steel in the world. When the bean counters considered the cost of spending billion to make the process meet up coming environmental laws, they got of the Tool Steel business because the profits would not be support the costs. Within a year the cost savings they expected never materialized and the discovered they were making much more profit on tool steel they thought.
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Must be extremely thin skin for gasoline is over the $3.00 mark. I remember in the '60s the "bone" was about forty cents a gallon.
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Record profit come from record sales. Americans are buying more gasoline and other oil based products than at anytime in our history. They are buying more gas a $3 a gallon than they did when it was only $1

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Mike hunt wrote:

Actually, compared to last year, gasoline demand is almost the same this year. And per capita demand is down (the population is up).

Gas was about $1 a gallon in 1995. Between then and 2003, 1995 and 2003, per capita gasoline consumption was essentially flat (up about 0.1%).
http://earthtrends.wri.org/text/energy-resources/variable-292.html
The greenhouse gas emissions per capita has remained essentially flat at 24 ton per person in the US between 1990 and 2003.
http://globalis.gvu.unu.edu/indicator_detail.cfm?Country=US&IndicatorID 9#row
This makes me think that people got more energy efficient overall.
Jeff
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You always like to pick and choose points in most posts so you can make a comment on most every post. What I said was, Americans are buying more gas at $3 a gallon than they did when it was only $1 That is a fact, even of it was only up about 0.1% FIVE years ago. One percent of millions of gallon is a $#it load of gas. Try reserching the total amount of gas consumption in the US. LOL

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More likely why my 2004 Ranger only has 21K on the odometer. Too expensive to drive any distance & since I'm disabled, I have no daily commute to deal with.
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