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When an option is not an option

Car Insurance

When an option is not an option

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Rewind to the days when something like a Conquest was all you need. In 2005, the prices for a new Conquest or Tazz ranged between R60,000 and R90,000 while the modern equivalent of the day sold between R130,000 to R200,000. Fast forward to 2017 and the range topping model costs north of R400,000. So, why are cars so expensive?

There are many factors influencing the showroom price of new cars. It is possible to mention inflation, currency fluctuations, dealer margins, sun, moon and many mysterious economic forces while sweeping our long list of feature requests under the carpet. This Zonotho post highlights our requirements and the ability for car manufacturers to meet some of them as a factor that drives up the retail price for your dream machine.

At one point in time, a range topping Tazz was equipped with air-con, cassette/radio sound system, immobilizer and optional metallic paint. Power steering, rear headrests and Bluetooth connectivity were an obvious omission to the standard equipment list but the vehicle still handles the daily commute of some South Africans out there without breaking a sweat. The story is completely different when we look at today’s range topping Tazz. It is a vehicle with a myriad of standard features like an automatic gearbox, USB port, keyless entry, heated foldable mirrors and a silent all electric driving mode for sneaking past the neighbour’s vicious dog.

Agreed, life is not the same as when we grew up and some of the features are necessary to complement the way we interact with loved ones and the world. However, take note of the extra features in your next set of wheels that make you creative when you are justifying why you want to need it because you are indirectly inflating the price of your purchase.

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Ipeleng is a co-founder of a start-up company that develops engine parts. One of his core responsibilities is researching marketing and pricing strategies employed in the automotive industry. He enjoys monitoring trends in the industry and sharing his observations.

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