Just been looking at a report on the Hyundai i40 saloon. Handsome beast.
tinyurl.com/6cauwq6
This caught my eye: "...it's expected a mid range model will cost from around £17,000 around £1,500 less than the estate."
All manufacturers charge a premium for estates over the saloon equivalent, of course, but it got me thinking. Do estate cars really cost THAT much extra to produce? There are only three possibilities.
1) The premium is about right to give the same profit on both saloon and estate.
2) The premium is actually too low, due to *real* extra costs of production
3) The premium is too high. and manufacturers are making a bigger profit on estate cars.
Which one is generally the truth, and are there any notable exceptions to the rule?
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Good question, i'm inclined to think the price difference is about right, though it could be argued that the windowed van should be be cheaper as compensation for owning such an ugly contraption..;)
Clever seat folding mechanisms, substantial parcel area/dog guard etc coverings with supports and fittings. Often uprated suspension. More metalwork, supports for the heavy tailgate, longer roof requiring more strength, more glass. Better quality floor/seat back coverings.
It all adds up.
edit..indeed this new Hyundai and it's Kia sister will be serious contenders, previous models were very good but were not cloned Mondeos/Vectra/Passat, now they look like all other cars in this sector private buyers will be more tempted.
Last edited by: gordonbennet on Wed 11 May 11 at 23:01
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>> edit..indeed this new Hyundai and it's Kia sister will be serious contenders, previous models were
>> very good but were not cloned Mondeos/Vectra/Passat, now they look like all other cars in
>> this sector private buyers will be more tempted.
Not at £18.5k it wont. You are firmly into discounted Mondeo territory.
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>> Not at £18.5k it wont. You are firmly into discounted Mondeo territory.
>>
Warranty.
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>> Not at £18.5k it wont. You are firmly into discounted Mondeo territory
You wouldn't pay full list for the Hyundai or Kia though. £15k closer to the mark I would have thought.
Last edited by: Dave_TDCi on Wed 11 May 11 at 23:35
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I think the premium is based mainly on what the market will pay. I remember doing the sums that led me to choose my Volvo. With prams and such kit to carry I'd have liked an estate, but at the time Volvo was trying to break into the saloon sector dominated by the A4 and the BMW 3, and pricing (and company car lease rates, which I was looking at) on the S60 was keen to reflect that.
On the other hand, Volvo knew buyers would queue up for its estates, so the V70 was priced well out of my reach - more like £4,000 extra, model for model, and this was in 2002.
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Estates always fetched better money secondhand, although that was when the 'other car' would more often have been a saloon, not a hatchback.
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A similar thing arose last week regarding the Qashqai:
"£16,195 for 1.6 petrol Visia to £27,895 for Qashqai +2 2.0 dCi Tekna Auto"
Given the price of the base model, how can you justify a 70+% uplift for top of the range.
There is no way that you can have this amount of extra labour and/or materials between the two versions of the car. Either the base is underpriced (unlikely) or the top of the range is a real moneyspinner.
Last edited by: lancara on Thu 12 May 11 at 07:59
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>> Not at £18.5k it wont. You are firmly into discounted Mondeo territory.
It's a nice looking car; prettier than the Mondeo by a long chalk. I reckon it will do well.
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Its is a nice looking car, and looks better than the mondeo. Trouble is 18.5k cars are bought by image concious buyers and the korean badge has no image. Discounted at 15.5k it will probably shift, that puts it into good value territory. Korean marques are never going to be able to sell outside the "good value" territory.
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Making a glass van pretty is not easy, but I think the Mondeo estate is one of the best-looking.
Merc estates look smart, too.
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>> I think the Mondeo estate is
>> one of the best-looking.
The current estate is the best looking Mondeo that Ford have produced so far.
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If anything it looks just like a direct copy of the Mondeo.On the link, picture 6 looks like a totally different car to the other pictures.On the first pictures the grill is facing down where as the 6th picture shows the grill facing up with different lights.
Last edited by: Videodoctor on Thu 12 May 11 at 09:15
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...it looks just like a direct copy of the Mondeo...
That was my first impression.
The Koreans are going back to basics - produce a clone of the best Europe has to offer.
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Hard to say who is copying who with the estates in this size class. Taking the Mondeo as a standard I think the i40 rear end lacks the subtle touch and seems overstyled.
3.bp.blogspot.com/-FWI4hQtQgFM/TW2__6H8EfI/AAAAAAAAIrM/XFRkenVsCCc/s1600/i40-estate-2.jpg
I was very drawn to the C5 Tourer before I bought mine as I thought they'd managed to make a fairly large car look neat... better than the saloon to my eyes so worth a premium for space, practicality and looks.
Last edited by: Fenlander on Thu 12 May 11 at 09:31
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"seems overstyled"
I think so too. They've over done it.
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I have a neighbour with a new saloon and another with a new estate. The latter looks far prettier to me.
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>> Just been looking at a report on the Hyundai i40 saloon. Handsome beast.
Looks like an MG6.
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'Handsome beast'?
Should've gone to Specsavers...
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I agree; you should have!
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What (affordable) cars do you reckon are handsome then Mike?
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I think saloon cars that disappear towards the back end (IYKWIM) like the i40 are very ugly indeed. But then I like estate cars.
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Would that include the Jaguar XF? Or the Citroen C6? Two very handsome two-box saloons - although arguably either might have been usefully designed as a hatchback instead.
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You are right about the Citroen C6 on both counts - such a wasted opportunity.
Citroen fell into the old trap of "Lets abandon the hatchback format for mid/large cars 'cos it is considered down-market. Lets make saloons like the Germans and move up-market".
And of course now, having persuaded most challengers to give up the hatchback, the Germans have started making them! (BMW 5 GT, next 3 series, Audi A5, A7)
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You forgot possibility no. 4. Production costs depend on the quantity being produced. The smaller the quantity the greater the cost for each unit. There are possibly less estates made than saloons.
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Good point, l'Es - and possibly why the hatchback Audi A7 is priced higher than either the saloon or estate version of the A6 with which it shares most of its components.
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But they usually don't share rear suspensions, sometimes being unique to the estate only, fitting the less made - costs more equation.
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When I ordered my present company car, the business leasing rate for the saloon and estate versions was almost the same, despite a higher list price for the estate. I guess this reflects the expected higher depreciation on the saloon version. I opted for the estate for practicality reasons. I would have preferred the saloon for the styling, better ride and quietness.
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>> When I ordered my present company car, the business leasing rate for the saloon and
>> estate versions was almost the same, despite a higher list price for the estate.
When I worked for big corporate, Audi A4 TDi saloon was in the list. I got a quote from the leasing compnay for the estate (Avant) and it was £10/mth cheaper - but I couldn't have it as it "wasn't on the list".
I got a Peugeot 406 Exec estate instead, and that was £30/mth more. It was also a turbo petrol engine, so used immensly more fuel than the diesel A4 would have done. Muppets.
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I'm sure the difference in production costs between saloon and estates must be minimal. I think it's all down to market perceptions and what the market will stand - i.e. you appear to be getting more for your money with an estate, and they have traditionally been more expensive.
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Having read all the replies, this is what I think (I think).
There really are extra costs involved in producing an estate car (and loss of economies of scale) compared to the saloon. The same issues are faced by coupe and cabriolet versions, of course. Therefore some premium *is* justified, merely to make the same unit profit on an estate variant.
That said, I believe that the premium actually charged is too big. What I think has been happening is that manufacturers have set the price of estates to make a bigger unit profit than the saloon, and then followed a two-pronged strategy to persuade people to buy the estate:
1) Glamourise the "lifestyle" image, backed up with posh sounding names like "Avant" and "Sports Tourer",
2) Remove the hatchback variant, so that if you can't make do with a saloon, then you have to buy the estate.
Examples of this in the last ten years are the Accord, Citroen C5, Avensis.
Honourable exceptions to this include Skoda, Mazda and Ford, who provide excellent hatchbacks AND estates. Their estate cars are particularly big and practical, and just the job for 'old-school' estate buyers.
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Why would anybody want a saloon or hatch?
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>> Why would anybody want a saloon or hatch?
>>
Blimey! You don't have much imagination, do you?
Here are a few reasons.
1. Because they don't like the looks of an estate car (Not everyone does - I think that they are hideous).
2. Because they don't actually need the space that an estate offers, and therefore don't see the need to pay the "estate premium"
3. Because they find it hard to find an estate car within budget due to the fact that more saloons and hatchbacks get produced, especially a used one. (Maybe asking a forum of car enthusiasts might help in this case)
4. Because they like the extra quiet/security/refinement that a saloon offers.
Of course the ideal car is neither a saloon or a hatch, but a sportback.
(Puts on tin helmet, and dives in foxhole)
Last edited by: Londoner on Fri 13 May 11 at 15:08
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...Because they like the extra quiet/security/refinement that a saloon offers...
I know of a government department which abandoned Granadas in favour of Vauxhall Senators when the Granny became a hatch.
The VIPs in the back complained of draughts around their necks.
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>> The VIPs in the back complained of draughts around their necks.
yes, well, when you a brass neck its not suprising.
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The Estate Premium - -
