If it is the union wages are costing GM so much money why is it the Toyotas
assembled in the US os mostly lower cost imported parts and material by non
union labor, cost 20% more to buy than similar sized and equipped GM cars?
I don't know, but I'm sure it is not a very simplistic answer. GM complains
they spend too much on labor, workers complain about too low a wage and
benefits, but that is only a portion of the entire picture. We don't really
know about the comparative efficiency of the plants, the distribution
system, the cost of parts, funding of new developments, and hundreds of
other factors that affect the cost of building a car and getting it to the
You buy a car that costs
two years later you sell it for
then resale value goes down by
every year after that and the car lasts
average repair and service costs
buy two year less per lasts yearly Total
price year years repair cost yearly cost
$30.000 $25.000 $1.000 15 1.000 $3.000
$30.000 $24.000 $2.000 10 2.000 $5.000
If you have to choose between two cars that costs the same initial
price it can be difficult to choose.
If you do know from experience that one lasts longer in general, has
better resale price, cost less in repairs then the Total yearly cost
is surely lower and that is what matters most to you.
If besides these costs you like the idea of having a reliable car that
gets you were you want to go when you want to go plus that it draws
less fuel will also affect your decision.
The differences may not aways be this obvious but in the long run you
will get the general idea and that is what has been happening over a
very long time.
Resale value on a particular model doesn't show the big picture. I sold a 96
Impalla SS last year for 19K. Bought a 89 GTA Indy Pace car new, kept it for
11 yrs and sold it for 22500, bought a 82 Porsche 924 new sold it in 84 for
9K at about 55% loss, have a 04 Pontiac Montana that I bought new and its
worth nothing. Smaller production numbers generally drive up resale. If
there are 10000 vehicles with 1 buyer they are cheap, 1 vehicle with 10000
buyers and you are gonna pay. Solid late 70's to late 80's 1/2 ton Chevy
trucks fetch 10 grand around here. Thats pretty good resale value. How many
G37's can they sell at 35K each. In a slowing car market probably not as
many as last year which was somewhere in the neighborhood of 15000. Yes that
will keep resale up. In 62 14531 Vetts were produced for a base price of
$4038 resale is high on them.
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