The Monterey auctions are mostly about high-dollar dream cars passing from one millionaire to another. These…
There are sub-$10,000 new cars out there, but you can’t have them
Remember the “low-priced three”? Younger readers will recoil at the notion, but until fairly recently it was common for products to be unashamedly marketed on their purchase price and/or cost of ownership. This was particularly true of cars, which were relatively short-lived and expensive items. So you had the “low-priced three” of Ford, Chevrolet, and Plymouth. The phrase even appeared in advertising during the ’60s.
The past, as I never grow tired of saying, is another country; they do things differently there. So the “low-priced three” of the era weren’t low-priced because of overseas manufacturing, or outsourcing, or “right-sizing the workforce.” Instead, they were cheap because they contained fewer amenities and less raw material in designs which were deliberately less complex to manufacture. I cannot find anything to suggest that the men and women who assembled the Plymouth Fury were paid any less than their counterparts on the Chrysler Imperial line, for example.
As I’ve discussed, nobody really knows how much it costs to build a car, so it’s no surprise that today’s market pricing is mostly driven by how much people are willing to pay. Take Buick as an example. Its vehicles are made in the United States, Canada, South Korea, and, in the case of the Envision SUV, by a joint venture between GM and China’s SAIC, in China. I don’t believe that anybody at Buick is trying to claim that building an Envision in China is just as expensive as building, say, a GMC Terrain in Mexico, or a Chevrolet Equinox in Ontario—but the Envision costs more than either the GMC or the Chevrolet, presumably because the Buick brand has some equity with SUV buyers.
Are you surprised that Chinese assembly is being used by automakers to boost profits, rather than lower prices? You shouldn’t be; if you’re reading this on an iPhone, you are already intimately familiar with a business model where the raw cost of the product is a minor component and the bulk of profits go to relatively intangible activities like marketing, advertising, and social media.
That “Apple model” is the envy of every industry on the planet. American-branded automakers, in particular, are unrepentant about their desire for a future where they spend most of their effort doing marketing while the (dielectric) greasy bits are assembled in mysterious Far Eastern factories out of both sight and mind. I guarantee you that at no point in these wistful discussions does anyone at the table suggest that the price of four-wheel transportation be lowered. Cars are a luxury item now. If you can’t afford one, then feel free to eat cake, or at least to pay a dollar a minute for a rental scooter with a wholesale price of $165. We call that a “mobility solution.”
How did we get from the past to here? That’s a topic for another time. For the moment, however, I want to discuss the fact that the “low-priced three,” or at least their spiritual successors, are very much in business on the other sides of both oceans.
Take, if you will, the Dacia Logan MCV. It’s a five-door wagon about the size of a Nissan Versa (that’s not an accident, the Versa is a platform relative), which can be had for about $10 grand in the UK. Even the snazzy versions with A/C and USB ports sell for the equivalent of $12,000. Mind you, this is in England, where everything else costs more than it does in heartland America.
The Logan is made in Romania, which is definitely a low-cost producer compared to Germany but perhaps not so much when compared to China. It’s modestly equipped, like the old “low-priced three,” and you get a low-power engine and a stick-shift transmission because those items are simply cheaper to make. The windows roll up and the doors are locked the old-fashioned way, by operating a mechanical switch. It does have anti-lock brakes; it even has “emergency brake assist,” something which I recall non-fondly from a few trackdays in modern Mercedes-Benz sedans.
Could the Logan succeed here? Nissan tried doing a sub-$10,000 version of the Mexican-assembled Versa hatchback a while back. Most of the buyers ended up getting a slightly better-equipped version. At the time, I considered the experiment to be an indictment of American consumers and their obsession with prestige, convenience, and, ah, not being seen hand-cranking a window in the Mickey-D’s drive-through. I thought the Logan, and its relatives, would flop in the Land of the Free.
Now, as Kenny Loggins once sang, I’m not so sure. Used-car prices have been pretty strong these past few years, which suggests that there’s room for cheaper new cars. The media is working day and night to convince us that we’d all be perfectly fine with a short-range electric-only commuter box; wouldn’t all of their arguments also support something like a Dacia Logan? Sure, the Logan can’t do 110 mph with the A/C blasting down a Texas freeway while cradling its occupants in F-250 King Ranch comfort—but will the prole-mobiles of our electric singularity be much better in that regard, particularly if they are rented to us minute-by-minute in some deranged “Mobility-as-a-Service” business model where you get to drop 10 bucks a mile and clean someone else’s vomit off your seat?
With that in mind, therefore, I’m announcing my willingness to spend $9999 on a no-frills Logan MCV the minute Nissan and/or Renault can be bothered to bring one over. I think it would help the economy. I also think it would help the economy even more if they were made in the United States. I’d pay more for that. Say $12 grand. If Nissan can’t make the numbers work, it could cut the marketing and social-media budget, because these bad boys will sell themselves.
Nissan’s introduction of the Logan as a U.S.-built budget contender might force the hands of its competitors. VW could try doing their Brazilian Gol in Tennessee. And maybe, just maybe, GM could knock together a bare-bones version of the Cruze for us, the way they do in overseas markets. What would we have then? Why, dear reader, we would have a “low-priced three”! Just in time for a generation that’s struggling with lowered job expectations and mountains of student debt. Given the choice between an ancient Corolla and a new Dacia, why not try the latter? And think of all the new jobs created by low-priced-three car production.
I know, I know. It’s crazy. But what if it happened? And what if all the suppliers around those plants started making other things as well? Like televisions, or clothing, or… cell phones. Sure, we’d start missing the benefits of globalism. Someone remind me, what were those again?
Last but not least, we might all do better as a society, and as human beings, if we rid ourselves of the notion that every single thing we did has to be social-media-worthy. Maybe people aren’t showing-off their new Dacia on Instagram. Maybe they’re spending that time with their families, or volunteering, or just reading a book. Heck, they might even pack their Dacias full of children and go off to explore the country. I can see it now…
See the U.S.A… in your Logan MCV!