We still have the cheapest car's in the world here in the U.S

Cars are getting more expensive because there are more rich people. People from BRIC (not so much the R) are coming to wealth. They can afford more, its only natural that with a bigger market you need to have more offerings.

 

And there are two other major reasons why vehicles, in general, are getting more expensive. First, because of the huge liabilities (and liability costs) that today's automakers incur. Look, for example, at what Toyota/Lexus paid out on the unintended acceleration issue, GM is paying out (or will pay out) on the ignition-switch issue, Ford and Hyundai paid out on the advertised-gas-mileage issue, and, of course, what VW will probably be socked with once this diesel-emissions scandal fully plays out. Those costs, of course, are usually passed on to the sticker-prices on their vehicles....as much as market-competition will allow.

Second, the auto industry, because of both public pressure for more comfort/convienience features, and because of government regulations adding more mandated equipment, have to spend more and more money simply designing and producing their vehicles. There's no free lunch....the more that vehicles cost to produce, in most cases, the more they are going to cost when you buy or lease them.

Case in point....when I learned to drive, decades ago, unless you had a luxury car (and luxury cars, in those days, were a block long and weighed 5000 lbs.), you rolled up your own windows, locked your own doors, adjusted your own seat, hand-adjusted your own mirror (most cars didn't even have a passenger's side mirror), wrestled with unassisted steering/brake systems, turned an AM radio on and off with a ****, opened a window (or vent window) in hot or stuffy weather, turned around and looked behind you before you backed up, checked for traffic before you changed lanes, checked the pressure in your own tires with a gauge, and did (or didn't do) any one of a thousand other things that are now done by electronics or motorized gear. Now, the latest governmant-mandate for new cars (taking effect next year) is standard back-up cameras in every vehicle, regardless of price. Obviously, that is going to drive up prices even more.

 

I agree with Bitkahuna's post. There is a HUUUGE (Donald Trump) disparity between the 1% and the 99%, and there is a great opportunity for automakers to reach that 1% that control a very large portion of the wealth. However, I think the challenge is still that the 1% have some Great Recession hangover and may still feel guilty about flaunting their wealth. They also don't want to be seen a conspicuous consumers by the other 99% (Can you say "target"?) It is that next "aspirational" tier that tends to lease the S Class and 7 Series. It is also the new money made primarily through technology and companies like Uber and Airbnb that want to reward themselves. They are part of a younger generation that has no qualms about flaunting their wealth on Youtube or Instagram.

Wow, this has gotten so philosophical!

 

Donald Trump doesn't represent the 1%. To put it in perspective, he is in the 1% of the 1% of the 1%. In other words, you need to go up a whole TWO more levels of 1% to get into the right ballpark.

I still don't at all buy that automakers are chasing the ultrawealthy when 60% of S-Class and 7-Series owners can't even afford or are too illiquid to buy outright. The demographic of people that are being are talked about in this thread seems to be what the MB-Maybach and other ultra-lux brands are after. I mean, even looking at inflation-adjusted MSRPs for the S-Class / 7-Series seems to completely debunk the argument.

 

You don't need to put anything in perspective for me. I used the Donald Trump word as a joke, not as an example of the 1%.

 

So was the joke the "Donald Trump" part or the "HUUUGE" part? Because I just don't think the distinction is nearly as big as you are making it out to be given the type of people that are buying the types of luxury cars brought up in this thread, and that was my point.

 

i don't understand though. why does lease automatically translate into "not rich enough"?

i can only speak about those around me who are for sure in the 1%. they lease because they still see better value in that because they like to always have the latest, and given the current model of depreciation a lot of these cars have, leasing makes more sense. being in the 1% doesn't mean they throw away money like nothing

 

Don't see how that's absurd at all. Lots of people want to keep getting new models every 2-3 years, esp. If they can write off the lease payments.

 

Oh and to debunk your idea gengar, steve jobs leased a new mb sl every 6 months. Was he rich enough?

 

Yea, people rich enough don't care to pay off the cars and keep them over 3 years, and they don't want to since they wanna change and have new cars often. And especially for higher end cars, the depreciation out runs the lease payment, so it's wise to lease than buy if they for sure going to dump it in 2-3 years. It's not like S class, 7 series are collectibles that worth to keep, now on your LFA is different

 

Paris apparently leased her LFA too. Fair enough, I guess I can't account for stupidity in the statistics we have.

 

If you're talking about Paris Hilton, that yellow LFA was (supposedly) a gift from her then-boyfriend.

 

On a made-up "reality" TV show, sure. That yellow LFA that was a "gift" was really P014 that Toyota supplied for filming.

http://jalopnik.com/paris-hilton-pay...exus-453384313

 

This recent quote from Fortune does indicate it is indeed HUUUGE...
"
The statistics that describe the magnitude of economic inequality are stark. Before taking into account the effects of redistributive government programs, the richest 1% of Americans make 20% of the income. Wealth inequality is even more extreme, with a recent study estimating that in America, the wealthiest 160,000 families have as much as the poorest 145 million families."

 

technology in particular has enabled more people (but a tiny percentage) to make MUCH MUCH more money employing (or contracting) fewer and fewer people.

then we have growing 'industries' like finance, accounting, and law that essentially contribute NOTHING to the economy, but take in VAST sums from others.