Are Luxury Automakers Jacking Up Prices in China?

on August 15 2013 | in Auto | by | with 1 Comment

Rolls-Royce, luxury, luxury cars

Are Chinese consumers being charged too much for foreign cars? It’s a question that’s been intriguing – and bothering – a lot of the Chinese luxury car-buying community.

International Business Times writer Angelo Young brought into focus an editorial published by China’s state-run Xinhua news agency, in which a man identified as “Qu” shared his experiences of buying an Audi. Qu paid $78,000 Canadian ($75,794 US) for a Q7 luxury crossover. Back in China, he did some price comparison. “The same car in the U.S. market sells for a little more than $60,000,” he said. “A third of the price in China.”

IBT compared prices of a sample of luxury cars using the Chinese-language website and the U.S. equivalent, Here are the results:

For the Audi A4L, the extended wheelbase version of the A4 is available exclusively in China. Prices ranged from $44,490 to $94,282, while the A4 in the United States retailed between $33,290 and $54,690.

The Ferrari 458 Italia listed for anywhere from $632,789 to $723,923 in China, while stateside the same model can be had for just $230,000.

The BMW X5 luxury SUV crossover ($330,000 in China, while about $103,000 in the U.S.) and the standard Mercedes-Benz E-class sedan ($70,000 in China and about $48,000 here). Even buyers of the Mini Cooper can’t catch a break in China, where a fully loaded model can cost $85,000 compared to $52,500 in the U.S.

While taxes, import fees, and surcharges are usually cited as the reason for the difference in prices, Qu believed that the automakers deserved most of the blame. The China Passenger Car Association estimates that foreign auto companies make profits up to 30 percent on the sale of imported cars in China. Rao Da, secretary general of the China Passenger Car Association, told Reuters, “Foreign carmakers have chose to set prices of luxury cars excessively high in China, where the rising ranks of the rich are willing to buy expensive foreign brands to show off their wealth, and where there are no domestic luxury brands to compete with.”

While an official inquiry into the cause of the price differences has yet to be conducted, public opinion seems to think luxury auto makers are jacking prices in China.

image credit: santi mb photos

photo credit: caranddriver

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One Response to Are Luxury Automakers Jacking Up Prices in China?

  1. Benjamin says:

    Haha, you think? There are Chinese consumers happy to spend more money than their neighbors in foreign luxury cars, why would the industry let that opportunity go? Plus, the quality of Audi cars made in China is far lower than those made in Germany. But who cares? There still are gullible buyers.

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