European demand in general is weakening again and vehicle manufacturers make more money by strictly matching supply and demand. For this to be successfu,l production planning volumes must be predicted accurately and conservately before the project kicks off. VW are experts is predicting demand, controlling future value of there products. Complex statistical models are developed so they can maximise profit. Only by manufacturing for accutal demand can they maximise profit. They know exactly what they're going otherwise they would plan differently. Long waiting times and high sale prices protect future values of out going models therefore protecting and maximising dealer revenues. The larger the car company the more important it is to 'control' demand. With so many options available to customers, complexity results in extended lead-times. I suppose anyone who went through this long wait for their mk6 will not be surprised with the current situation at all. I can't wait pick mine up..........
Exactly.
VW are the masters of competitive running costs through clever financing and engineered high residual prices in the used market.
They charge a lot of money for their car, given the age-old status of the VW badge as a “people’s car”, but make them affordable to finance due to their relatively low depreciation. Would you pay up to a £5k premium for a GTI/GTD over its Ford/Alfa/Seat/Vauxhall equivalents if the residuals were 35-40% after 3 years and you ended up paying £150 a month more as a result.
They can charge top whack for a product to maximise profit and have customers satisfied that the residuals will keep monthly prices low – everyone wins to the point until the car’s price-point in the used market is unmaintainable e.g. a Focus ST can be bought for 30-50% less than a GTI of the same age, something has to give.
VW see themselves as established semi-premium now, if not premium. The only way VW can maintain such cracking residuals on a GTI (51% GFV) or GTD (56% GFV) and keep the cost to run one at a pricepoint that many will accept is to limit production. The masses of SE and GT Golfs mean that high GFV is hard to maintain – all the lower Golfs come in at between 44 and 47%, to the point where a GTD can cost a few quid a month less on finance than a GT TDI150 if you can be bothered to wait for one.
In the last 4 years we’ve seen a 30% rise(£20k to £26k) in the cost of a GTI between MK5 and MK7 (most of it being loaded onto the MK6) despite massive savings in the assembly costings (simplified multilink rear suspension being the most memorable).
There aren’t many marques that would stomach that in a period of recession and stagnation, VW almost caught up with BMW and Audi prices in that period. If Audi weren’t so tight with their standard equipment and staid in their generic styling (not saying the Golf is a true beauty, but it’s far easier to tell a GTI/GTD from a lower model than can be said for the A3 (S3 excepted) ) I’d probably be looking to get an A3 over a Golf.
Anyway, the main point is, if the GTI or GTD was as common as any other Golf with all feelings of exclusivity gone and paying out more per month via lower residuals – would we still buy one over a BMW123D/125i or Audi A3? That’s some consolation as to why we have to wait so long for one!
