Dealer said beware price increase
10-23-2007, 09:02 PM
#11
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VAG "Fully Hedged for 2007 and more or less fully hedged for 2008" ...
As the dollar continues its long slide against the euro, prices of vehicles made by such auto companies as BMW AG, Porsche AG and Volkswagen AG's Audi unit have steadily crept upward ahead of U.S. and Japanese vehicles over the past few years. But while car makers have largely avoided substantial price increases so far, some analysts are warning that could change as soon as next year.
They "can't make money at the current exchange rates, so they either have to raise prices or start building them here," says David Healy, an analyst at financial-services firm Burnham Securities.
"It's going to start to bite soon," says Nigel Griffiths, who directs European auto market analysis for Global Insight, a research firm in Lexington, Mass.
So far, European car makers have been able to hedge against currency fluctuations by buying contracts that guarantee certain exchange rates. But many of these contracts are set to expire soon, analysts say. Hedging lessens the Europeans' need to quickly change prices with every currency fluctuation, but the strategy is of limited value during long periods of weakness for a particular currency, Mr. Healy says. "They offer mitigation but nothing more," he says.
Increasingly, auto makers are seeking so-called natural hedges by building factories in the U.S., as BMW and Mercedes-Benz parent DaimlerChrysler AG have done, and boosting capacity at existing U.S. plants.
Some companies are combining strategies. BMW has taken a profit hit on cars it builds in Germany and Austria and sells in the U.S., thanks to the weak dollar, but its factory in Spartanburg, S.C., has helped it avoid some of the negative effects. Now the company says it plans to build more models and nearly double production in the U.S. to help insulate itself from currency fluctuations.
Volkswagen says it is also considering building cars here if the dollar remains weak. The company has cut costs by building vehicles in Mexico for years, but says its Mexican plant lacks the capacity to satisfy the entire U.S. market.
A Volkswagen spokesman says the euro-dollar exchange rate "certainly doesn't help" the car maker's business in the U.S., but the company is still "fully hedged for 2007 and more or less fully hedged for 2008."
He also says the company is studying the possibility of building vehicles in the U.S. "You have to look into it," he says.
They "can't make money at the current exchange rates, so they either have to raise prices or start building them here," says David Healy, an analyst at financial-services firm Burnham Securities.
"It's going to start to bite soon," says Nigel Griffiths, who directs European auto market analysis for Global Insight, a research firm in Lexington, Mass.
So far, European car makers have been able to hedge against currency fluctuations by buying contracts that guarantee certain exchange rates. But many of these contracts are set to expire soon, analysts say. Hedging lessens the Europeans' need to quickly change prices with every currency fluctuation, but the strategy is of limited value during long periods of weakness for a particular currency, Mr. Healy says. "They offer mitigation but nothing more," he says.
Increasingly, auto makers are seeking so-called natural hedges by building factories in the U.S., as BMW and Mercedes-Benz parent DaimlerChrysler AG have done, and boosting capacity at existing U.S. plants.
Some companies are combining strategies. BMW has taken a profit hit on cars it builds in Germany and Austria and sells in the U.S., thanks to the weak dollar, but its factory in Spartanburg, S.C., has helped it avoid some of the negative effects. Now the company says it plans to build more models and nearly double production in the U.S. to help insulate itself from currency fluctuations.
Volkswagen says it is also considering building cars here if the dollar remains weak. The company has cut costs by building vehicles in Mexico for years, but says its Mexican plant lacks the capacity to satisfy the entire U.S. market.
A Volkswagen spokesman says the euro-dollar exchange rate "certainly doesn't help" the car maker's business in the U.S., but the company is still "fully hedged for 2007 and more or less fully hedged for 2008."
He also says the company is studying the possibility of building vehicles in the U.S. "You have to look into it," he says.
10-24-2007, 01:08 AM
#12
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I agree, our pricing is very good. Here are some different pics.
<img src="http://pictureposter.audiworld.com/14368/s5pics_10.jpg">
<img src="http://pictureposter.audiworld.com/14368/s5pics_15.jpg">
<img src="http://pictureposter.audiworld.com/14368/s5pics_11.jpg">
.
<img src="http://pictureposter.audiworld.com/14368/s5pics_15.jpg">
<img src="http://pictureposter.audiworld.com/14368/s5pics_11.jpg">
.
10-24-2007, 05:36 AM
#17
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Thank you - but a small disclaimer.
You can see flakes in the paint when up close. It does resemble metallic. However in these pictures, the contrast was altered a bit to differentiate between the aluminum bits and the paint. It really only looks like this in low light conditions (dusk, dawn, shadows). I didn't alter the brightness or colors of the pictures.
