Not Just The UK Stealers

[Rory]

In the past it was more expensive to employ people in France or Germany than in the UK but not these days. Lots of employment tax increases have been passed on to employers rather than employees.

I mentioned Paris & Munich because I employ people there - the UK is *way* cheaper. Employers social costs are pretty well 50% on top of gross salary in France, and Germany isn't far behind.

 

[television]

I was just thinking of my local recycling center who pay £1200 a week for customer liability insurance, that with a staff of four

 

[Mudster]

I mentioned Paris & Munich because I employ people there - the UK is *way* cheaper. Employers social costs are pretty well 50% on top of gross salary in France, and Germany isn't far behind.

How much do they pay in business rates and insurance in either of these countries?

 

[big x]

If the dealer rates are cheaper in Tokyo then I would suggest that the margin model on new cars is different in Japan which allows the dealer to make money from selling cars rather than just after sales.

The high labour rates in the UK (and especially London) are the direct result of EU competition regulations brought in as a result of the 'rip-off Britain' campaign. Historically cars were priced higher in markets that had higher operating costs so that dealers made money from 3 areas of their business - car sales, service and parts - to cover the overhead cost of the dealership and, hopefully, leave a profit.

Over the last few years car prices have been harmonised across Europe (save for fluctuations in exchange rates and purchase taxes). Also the profit margin available to the dealer has been fixed across Europe. This means that a car sold in the UK is sold to the dealer at the same price as it would be supplied to a dealer in any other EU country and the dealer has the same profit margin. This works well in most EU countries but is a particular problem in the UK due to very high property costs and subsequent high cost of labour (higher property prices = higher cost of living = higher cost of labour). The profit margin on the sale of a new car in the UK barely covers the cost of employing a sales team and running a demostrator fleet. In order to cover the overhead cost of their facilities dealers have been forced to dramatically increase their labour rates to boost profitability in the service department to replace the loss of profits from new car sales.

If you think that Central London labour rates are a rip-off then there is nothing to stop you setting up your own business as a Mercedes-Benz Authorised Repairer and charging a lower labour rate. The Authorised Repairer option has existed for several years but to date no-one has tried to set one up in London.

Also, if you think that it must be possible to make money selling just new cars then consider that there are no Mercedes-Benz Authorised Resellers (i.e. independent car sales only operations) in the UK. Off the top of my head I can't think of any Authorised Resellers for any major brand in the UK but there may be some out there somewhere.

When the price differentials where at the widest I bought a new Golf from Denmark where the pre-tax prices where 60% less. At the time the operating costs of Danish dealers where far higher than the UK. Wages were higher there as were social costs.The price differential was due to VW UK greed and long term refusal to lower prices to dealers despite the strengthening pound, the so called orderly market approach. Since then the gap as narrowed due the makers increasing prices there and holding them steady here.(Denmark is not in the Euro) The market is also distorted of course by the the unique UK company car market where the private buyer is excluded from bulk discounting.
The pan European pricing scheme has also resulted in things like the RHD surcharge (despite 25% of the World be RHD) and options being more costly here. A quick check on the MB DK site shows prices 6% higher here.

There are no authorised repair facilities because once outside the warranty period there is a large network of specialist charging from £35 hour competing for business.

There are no Mercedes-Benz authorised resellers because they wouldn't have access to MB UK special dealer promotions and incentives.It wouldn't be a level playing field.I've also read of hindrances by manufacturers in supplying specialist equipment ,training and expensive rules on premises meeting the corporate look which would put such companies at a disadvantage compared to brokers sourcing from official dealers but with no actual sales premises.

The only point of agreement is that profit margins on new car sales are very slim.It's Lucky for good salesman then that the used car business is so lucrative !

adam

 

[DC_insider]

When the price differentials where at the widest I bought a new Golf from Denmark where the pre-tax prices where 60% less. At the time the operating costs of Danish dealers where far higher than the UK. Wages were higher there as were social costs.The price differential was due to VW UK greed and long term refusal to lower prices to dealers despite the strengthening pound, the so called orderly market approach. Since then the gap as narrowed due the makers increasing prices there and holding them steady here.(Denmark is not in the Euro)
The pan European pricing scheme has also resulted in things like the RHD surcharge (despite 25% of the World be RHD) and options being more costly here. A quick check on the MB DK site shows prices 6% higher here.

Denmark tends to have lower pre-tax prices due to very high taxes applied for purchases in Denmark (and not exported).

From the EU price comparison website:

C220 CDI in the UK 27,143 Euro before tax, 31,893 after tax.
C220 CDI in Denmark 28,664 Euro before tax, 90,750 after tax.

There are no authorised repair facilities because once outside the warranty period there is a large network of specialist charging from £35 hour competing for business.

There are Authorised Repairers outside of London and they manage to compete with Independents. There is no reason why it shouldn't work in London if the labour rates really are a 'rip-off'.

There are no Mercedes-Benz authorised resellers because they wouldn't have access to MB UK special dealer promotions and incentives.It wouldn't be a level playing field.I've also read of hindrances by manufacturers in supplying specialist equipment ,training and expensive rules on premises meeting the corporate look.

I don't see why an Authorised Reseller would not have access to DCUK support. They would be purchasing the cars from DCUK so would be the same as any other dealer.

The only point of agreement is that profit margins on new car sales are very slim.It's Lucky for good salesman then that the used car business is so lucrative !

adam

 

[big x]

EU price comparison website ? Just go to http://www.mercedes-benz.dk/
and press Personbiler then Nye biler.

SLK 200 K price 228,569 Kr which is £21390 before delivery and tax

How much is the UK pre-tax price ? I went to the UK website but in typical British fashion it was not working !

I believe the pre-tax price here is £24478 which is 14.4% HIGHER than Denmark.



adam

 

[DC_insider]

EU price comparison website ? Just go to http://www.mercedes-benz.dk/
and press Personbiler then Nye biler.

SLK 200 K price 228,569 Kr which is £21390 before delivery and tax

How much is the UK pre-tax price ? I went to the UK website but in typical British fashion it was not working !

I believe the pre-tax price here is £24478 which is 14.4% HIGHER than Denmark.



adam

SLK200K in the UK £23,779 pre tax which is still higher but it varies from model to model.

For example, E220 CDI in Denmark is 264,874 Kr or £24,788 but £24,179 in the UK.

 

[television]

EU price comparison website ? Just go to http://www.mercedes-benz.dk/
and press Personbiler then Nye biler.

SLK 200 K price 228,569 Kr which is £21390 before delivery and tax

How much is the UK pre-tax price ? I went to the UK website but in typical British fashion it was not working !

I believe the pre-tax price here is £24478 which is 14.4% HIGHER than Denmark.
adam

Hang on Adam, we had this crisis when I lived in Sweden,where the basic price is lower than other countries due to the high duties and tax. It once paid Swedes to buy in Denmark, but this has been squashed and no longer viable as your car never comes.
the actual price paid in Denmark for a dansk buyer is awful

take a SL500 basic price 666,226 dkr, add the moms (tax)116,556dkr that makes 832,782 dkr. It cost you 1,481,350 to register it, the on the road price is believe it or not is 2,258,233 dkr @ 10,670 to the £ that works out at

£213,040 thats not bad is it for a SL500

but a house over there is only half the price of here and better built

 

[big x]

SLK200K in the UK £23,779 pre tax which is still higher but it varies from model to model.

For example, E220 CDI in Denmark is 264,874 Kr or £24,788 but £24,179 in the UK.

I think MB in Germany have pretty much put a stop to Germans nipping over the border and buying in Denmark.The Kroner is pegged to the Euro which cuts out any favourable changes in the exchange rate. Bad news for the Danes. Their pre-tax car prices must have shot up since 2000 whereas in real terms ours are the same or less when inflation is taken into account.

When it comes to used cars the UK is very cheap. I've done comparisons with Germany and the States and depreciation is higher here.Britain is a very good country to buy a 3 year or older prestige car.

adam

 

[big x]

Hang on Adam, we had this crisis when I lived in Sweden,where the basic price is lower than other countries due to the high duties and tax. It once paid Swedes to buy in Denmark, but this has been squashed and no longer viable as your car never comes.
the actual price paid in Denmark for a dansk buyer is awful

take a SL500 basic price 666,226 dkr, add the moms (tax)116,556dkr that makes 832,782 dkr. It cost you 1,481,350 to register it, the on the road price is believe it or not is 2,258,233 dkr @ 10,670 to the £ that works out at

£213,040 thats not bad is it for a SL500

but a house over there is only half the price of here and better built

Lucky for me you only have to pay 17.5% VAT importing a car from the EU plus registration costs.Taking into account the ferry etc I saved around 50% on the Golf.
These days the savings are so small it would not be worthwhile particularly with brokers like Drivethedeal able to supply UK cars at good discounts.
I also bought an Aprilia RSV100R when they first came out in Denmark for £5200 when the UK price was something like £9000k. The UK importer got very annoyed as that was less than the factory was charging him ! These large differentials are unsustainable in the long term and with the transparency the internet offers I think may be a thing of the past.
Having said that Japanese 4x4 pickups are much much cheaper in Indonesia than here.Toyota are ripping off Europeans big time.

adam

 

[lexuscol]

I don't mind paying a fair price and accept the fact that if I run an expensive car, I have to pay a bit more than the guy with the run of the mill motor. My objection is to the lies and bull we are given by the dealers/service personnel. (here comes another sucker, he won't know any different.
Being treated like you have no right to come into the garage once you have made the initial purchase of the car.
It isn't just Mercedes Benz its them all, Mercedes are a bit dearer is all.
I would make a bet that if the guy in the video had found a stone to be the culprit in the customers sun roof, he would still have charged for a new mechanism without blinking an eyelid.
Thats the rip off bit.
Like the advert for the Nationwide, Sorry mate it doesn;t work like that, It works like that.

 

[Baschurchbill]

I had a customer ring me a couple of days ago. She had lost drive on her 53 plate Discovery coming out of an island. She had rung the main dealer who had told her it would need a recovery and a new transmission at £1500. I told her to re-select high range and it was all ok. It is a common fault the high low range lever get knocked towards neutral and jumps out!

 

[prprandall51]

I had a customer ring me a couple of days ago. She had lost drive on her 53 plate Discovery coming out of an island. She had rung the main dealer who had told her it would need a recovery and a new transmission at £1500. I told her to re-select high range and it was all ok. It is a common fault the high low range lever get knocked towards neutral and jumps out!

Not one of those women who use their 4x4 off road regularly then..... I imagine the dealer supposed the owner of the vehicle knew it had a high / low range selector and 4x4 capability. That kind of presumption is unforgivable I bet the dealer assumed the owner had read the handbook, too. Shocking.

 

[Baschurchbill]

Yes she is one that rarely if ever uses the low range but often off road with a horse trailer. Think it is more likely the customer facing dealer staff are to inexperienced to give out real advice and are conditioned into "big" repairs.

 

[Ron . B.]

Yes I do thank you, I have a flat there. I've spent some time with a Japanese friend with a place in central Tokyo where property prices are almost as high and the dealer labour rates are much cheaper there.


adam

Quite true,the Japanese merc dealer/service centers ( the ones with the big Ferris wheel ...) are remarkbly cheap. A friend in the Dip.Service had a ABS light come on in his old merc. The car was placed in the ferris wheel,taken down stairs,diagnosed and the offending relay replaced.Car was given a quick clean and handed back 1 hour later....$75 US,thank you very much....