Why Can't We have a Cheap Car?
Overregulation makes us all poorer.
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The International Herald Tribune reports that Tata Motors, an Indian conglomerate which is about to buy Land Rover and Jaguar from Ford, has announced a $2,500 automobile.
The 4-seater Nano, with an engine around 625 cc, will have a dealer price of 100,000 rupees, or $2,500, and will go on sale later this year. Taxes and profit margins will push up the price for buyers, but it will still cost about half the cheapest car currently on the market, a 25-year old model from rival Maruti Suzuki.
The compact but curvy Nano stands in sharp contrast to the luxury Jaguar and Land Rover brands that Tata is negotiating to acquire from Ford Motor.
Why can't we Americans buy cheap cars? The cheapest car in the US costs about $20,000, about 8 times the cost of Tata's offering. Are the Tata engineers 8 times as smart as the Japanese and Korean engineers who designed the cheapest cars we're able to buy?
They didn't cheap out on safety. Auto Savant says:
...the end result is a conventional automobile that meets international offset and side-impact tests.
On the other hand, it doesn't have air bags. Even though it would reduce carbon footprint compared with other cars, it probably won't meet our finicky EPA regulations. Its bumper height is probably wrong. Business Week said:
It meets domestic emissions norms and will soon comply with European standards.
International carmakers and media doubted Tata's ability to meet international environment and safety standards.
Being very small and having a small engine helps meet environmental standards. If it meets crash tests, do we really care about details like bumper height?
It's well known that being poor shortens life expectancy. By making our cars cost SO much more than necessary, our regulators and bureaucrats have made us all a lot poorer. Let's hope that the Tata example gives us an incentive to demand that our government let us drive cars that cost a lot less.
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What does Chinese history have to teach America that Joe Biden doesn't know?
Its hard to believe you're basing an article on a car with a top speed that wouldn't even be able to meet minimum speed requirements on some our freeways. And then comparing that with the solid, reliable $10-$15k cars available new in the US.
You also fail to mention things the tata nano lacks, like a radio, air conditioning, electric windows etc. No safety features like air bags. No power steering.
This car might be a good replacement for Indians trying to pack a family on a motor scooter, but can't come close to a car any American would want driving on our roads.
$20,000 may be a little high. But once you add tax, title, delivery fees, and so on to your "$13,000 car", it's not so very off.
True, tax, title, delivery fees, etc will add cost to the $13k car. But not $7k... more like $2k, max -- bringing it to $15k _total. If that's the way you're comparing, you also have to take those into account with the nano... that would probably about double the cost, as a big chunk is the freight cost.
The equation ends up being pretty much the same... A safe, reasonably performant car with all the features Americans have become accustomed to (and with a good warranty) for $15k vs a tiny, crappy all around car for $5k.
There isn't even a comparison. A more apt piece of American hardware to compare to would be a midrange John Deere ride on lawnmower. That's basically what you get with the nano.
Right on. When they say "top speed 65" that doesn't mean that it will be doing that all the time and therefore is useable on highways or even boulevards. The average American car has a top speed of 120-130. This thing is a little go-kart with enough safety parts stapled on to pass regulation.
Could we make cars cheaper? Sure. But for what Americans want, it wouldn't even come close to this.
I'm not even going to address the vast and sweeping political changes you arbitrarily suggest. Next time you may want to actually have a grasp of the "problem" you are trying to fix before suggesting a "solution".
Kia Rio $11,515
Hyundai Accent 10,775
Toyota Yaris 11,350
Even after tax and title it's still not $20k
The question is NOT whether the cars being sold in America are 2-3 times as good, the question is WHY we permit all those regulations which boost car prices so much. For example, air bags add a lot to the price of each car and cost at least $5 million per life saved based on the number of cars sold and the number of lives saved. Is that worth it? I say no, we should spend the money on something else.
AS I SEE IT, we ought to let someone import these cars to the US and let consumers decide. If a person driving a few miles to work can get a car that's 1/3 as good for 1/3 the price, and can use the extra money for something else, he ought to be permitted to do it. Individual choice is the American way, but the bureaucracy no longer lets us to choose to buy cheap cars.
That's my beef.
There are many US cities where public transportation is less well developed than in NYC or Boston; people in those cities would benefit from being able to get cheap transportation. We'll grow REAL OLD waiting for public transport in most cities.
Again, the point is that buyers should decide, not bureaucrats. Real Americans buy what they want.
I live in India and i think Nano is a path breaking invention. its just what the public needs, it cheap, has an extremely high fuel economy, and is small and sharp which it makes it ideal for our narrow congested raods. what it lacks in basic amenities, it makes up in versatility and design. its perfect for the Indian driver who only cares about price, period!
as far as other countries are concerned, its going to do great in any city across the world that faces crazy traffic, albeit it will definitely be more of a hit in not-so-affluent neighborhoods
as far as Americans are concerned, i know the initial shock with the size will be a difficult pill to swallow. but rest be assured that it will definitely meet all emission and safety regulations before they launch it in the country. so it will defeintely be as safe as other compacts availabel for $15,000 and will have all the basic features like air conditioning, air bags, music player, foldable seatbacks etc as standard features. that may bump up the price tag a tad but it will be way way cheaper than any other car available in US today
will the American people accept it? well, as jackkeats puts it, there are many cities in US, like New York, DC are the 2 i have driven in and i know traffic jams are a given and parking can be a real pain. i have personally had so many evenings out where id rather metro it than take my car coz i know illland up sending 40 mins looking for a parking space. what would i give to have a teeny tiny lil Nano in moments like those! besides, of course there are people out there who cant afford even a $10,000 car.. especially the ones who lost their jobs recently.. its better to buy a small cheap car than run up huge home mortgages dont you think?