October 2, 2007
collapsing US dollar will make european cars expensive
Euro-Trashed? Why You May Want to Buy That BMW Now - WSJ.comDrivers who have been thinking about buying a European luxury car may not want to wait too long.
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.
The dollar's weakness against the euro makes European products more expensive for consumers using dollars. If the trend continues -- and many analysts expect it will -- European car makers ultimately may have to raise prices on vehicles they build in Europe and sell in the U.S., shift production to the U.S. or other countries with lower costs, or simply live with lower profit margins.
Oh great
Posted by TY at October 2, 2007 1:21 AM
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