Vehicle Questions and Answers
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The profit margins for vehicles are quite slim and can vary depending on the specific model and year. Take, for instance, the 2021 Ford Mustang with a listed price of $27,122 - it costs Ford around $25,000 to produce. This cost can fluctuate based on various expenses such as raw materials and parts, which make up approximately 57% of the total price. Additionally, there are expenses for research and development for each new model year, even for well-established products like the Mustang, constituting around 16% of the vehicle cost. Other costs to consider include labor, advertising, sales tax, depreciation, logistics, overhead, and dealer markups.
The typical car requires around $20,000-$23,000 for production by the manufacturer.
What do you think about a price range of $12,000 to $15,000? Let's break down the car into three parts: 1. From the engine hood to the bottom of the tires, priced at $5,500. 2. From the roof, through the cabin to the ground, priced at $3,500. 3. From the trunk lid to the bottom of the rear tires, priced at $2,500. This includes plastic, rubber, aluminum, leather, and metal components.
It costs $40,000 to construct a 2020 Ford Mustang Shelby 500GT.