How can Korean car companies afford to sell their cars so cheap over?

[NFS4]

I mean, they come with all these standard features (side airbags, ABS, AM/FM cassette, A/C, fog lamps, 10 year warranty, etc.) for like $10,000 or something like that. Then you can get one with a microwave, fridge, and a cardboard cutout of Heather Locklier for about $15,000. Are they making ANY money?? Seems like they would lose big on the 10-year warranty, but who knows.

You KNOW they've got to be skimping somewhere...I just can't put my finger on it...

 

[Urinal Mint]

It's called "slave child labor"

 

[natto fire]

quality?

I know that it is covered by the 10 year warranty but isn't that only on powertrain. Other parts can break that are expensive too.

Just my $.02

 

[Pepsi90919]

<< You KNOW they've got to be skimping somewhere...I just can't put my finger on it... >>

Quality maybe?

 

[JohnnyKnoxville]

Easy just look at the build quality

KIA = POS

 

[Helpless]

Damn, if that's the case, where can I get some of that?

 

[bigd480]

ever seen their crash tests? u gotta use the jaws of life for a 5mph collision <exaggerating>

skrimping is on build-quality, R&amp;D (just take free ideas), materials, # of models/trim-lines...

i haven't figured out the warranty... maybe the dealer is who you buy the warranty from (meaning they add their cost to the vehicle cost) and they figure they can screw you on non-warranted services?

 

[warcleric]

Yeah, KIA=PoS, especially since they use those mitsubishi motors. Guess that makes the eclipse a PoS too....oh wait, I already knew that.

<<EDIT>>

Let me just add that I was bored the other day and stopped by the Hyundai dealer, they are making some nice cars now. I would take a new Hyundai over a Honda any day for the value. Honda's are so overdone....so go rush out and buy one and be just like the rest of the herd.

 

[Mikal]

Dumping below cost to increase market share.

 

[Fausto]

They keep costs down by using outdated japanese car technology and skimping on the build quality and materials. They may be cheap, but I'll take a 2 year old Altima for the same price as a new KIA anyday.

 

[bigd480]

<< They keep costs down by using outdated japanese car technology and skimping on the build quality and materials. They may be cheap, but I'll take a 2 year old Altima for the same price as a new KIA anyday. >>

true that, and as warcleric mentioned hyundais are kinda tempting (as far as &quot;bang for the buck&quot... but i think mainstream autos are one category where &quot;you get what you pay for&quot; really applies... you can't really make &quot;hot deal&quot; cars by the millions... the closest thing, for young guys anyway, were the fbodies, but not for long...

 

[tontod]

They probably just operate on a lower profit margin than the Japanese car makers.

 

[NFS4]

<< Easy just look at the build quality

KIA = POS >>


I was trying to give them the benefit of the doubt with build quality b/c everyone seems to belive that their build quality has gone way up in recent years. I've been reading some good things (shocking:Q) about Hyundai. In fact, Hyundai's XG300 recently won a comparo between the Honda Accord!!! and Dodge Stratus over at MT. And they loooooooooooooooooooooooooooooooooooooooove Japanese cars like crazy.

 

[RaoulDuke]

I believe they make them out of japense and chinese people?

 

[CivicSiRider]

You know that before KIA came to the US to sell cars, Korea use to just sell them as a kit. You could buy a KIA kit and build the car yourself. What does that tell you?

 

[MrMojo]

I consider myself a car buff I've been reading about and taking note of cars for years, and I have to say the current crop of Korean cars like the Kia Optima/Hyundai XG300 are built to really high standards. The amount of car you get for the money surpasses any Japanese/American car in that price range. However, I've yet to drive one so I cant speak on the driving dynamics, but I am very impressed with the quality of the materials and features.

 

[freebee]

Korean car companies really can't afford to sell their cars so cheap. However, if they don't sell them at a discount, along with a substantially longer warranty, consumers simply wont buy them because of past lapses in quality and reliability. The gaining of market share and most importantly dealer support and establishment of distribution channels will be vital in any future attempts to succeed in the US market. Unfortunately with so many good used cars coming off 2,3 year leases even the practice of selling at prices below the competition is not always a succesfull practice. Consumers often equate price with quality (especially in cars) and an aggressive pricing structure may even be detrimental to overall sales.

 

[NFS4]

<< I consider myself a car buff I've been reading about and taking note of cars for years, and I have to say the current crop of Korean cars like the Kia Optima are built to really high standards. The fit and finish and solidity of the cars surpasses any Japanese/American car in that price range. However, I've yet to drive one so I cant speak on the driving dynamics, but I am very impressed with the quality of the materials and the build quality. >>


I'd say that their build quality is right below or on par with American and Japanese cars...but NOT surpassing Japanese standards.

I consider American vehicles and Japanese vehicles to be equal in build quality...but there is one area where Japanse cars excel (at least in the interior department). They use higher quality materials on the dash, switchgear, etc. and the interior in general than American makers of the same price class...

i.e. a Camry interior compared to a Ford Taurus, Civic compared to a Focus, Explorer compared to a Highlander. The Japanese come out on top every time with materials choice for the interior. Everything just looks and feels much nicer to the touch. And compared to the Explorer and Highlander, the Chevy Trailblazer interior looks as cheap as a Cavalier.

And since you spend 99% of your time inside your car than outside looking at it, the interior materials quality is important to me.

 

[HardcoreRobot]

Perhaps Korean cars arent cheap but its peers are overpriced?

 

[MrBond]

My cousin just bought a new KIA (the quasi-suv kia). Had it about a month now, and last weekend I noticed it making a strange noise when she turned into a parking spot. Just about turned me off to them.

I've heard Daewoo made decent cars for the price, weren't they Korean? Can you even get them anymore?

 

[Mikal]

&quot;Made with Care by Prison Labor&quot;

 

[frizzlefry]

I agree with some that are saying it is to increase market share. If the car has a 10 year warranty, that means they just may hold onto that car for ten years. If at the end of those ten years (or even before that) and they need another car either for themselves, or maybe their children, and they found the car reliable as well as the customer service, then what do you think they will buy. I'm a strong believer in that most people will buy a vehilcle of the same make if they found the experience pleasing enough. It doesn't have to be perfect, just good enough that putting up with a few problems here and there are not big issues.

My father's purchased american cars and I was raised on them Oldsmobile was what he always bought. It was also my first car. What happened even after my car burned up (spontaneous combustion )? I to bought an oldsmobile. Of course there were incentives to do so. But kia, daewoo, etc are in the business of building market share. Daewoo has lost so much money that they have the debt of some small countries (i think they surpass israel). But in order for any company to get a foot in the door, they need to sell at a low profit, or for no profit.

Thake AMD for example. In order to build market share, they were welling 486 chips at cost. Why? Well they could then take this money and fund their research for faster chips (which they have done a great job). but even though they have good market share, they still undercut intel pricing in order to continue to build market share.

I would love to go and test drive the new hyundai. I've heard really good thigns about it and for the money, all those extra options? How can you beat it? Also with a ten year warranty, would you rather get the base civic or loaded hyundai/daewoo for the same price?

 

[Aenygma]

*sigh*

Interior pieces? The civic is such cheap plastic, man go out and look sheesh.

Their prices are a lil less then the competiton for a number of reasons.

1. The labour they employ gets paid substantially less.
2. They have to be more competitive to gain market share. ( Which they have pretty much acheived already, hence thats why we are now seeing the introduction of the 20K+ models.)
3. Their warranty is 10K for powertrain this is true, but then they still give 5 Years bumper to bumper, pluse free rental, roadside assistance etc.

It all comes down to what you like, get what you like.

 

[MrMojo]

I changed my post right after I made it, but I tend to disagree about cars like the XG300 its interior finish is way above that of Camry's and Accords in the same price range. I'm not saying it drives as well as a Acura TL or Lexus ES300 but its quality of materials is more in line with those cars than with a Camry.

 

[NFS4]

<< *sigh*

Interior pieces? The civic is such cheap plastic, man go out and look sheesh. >>


I have looked, sheesh!

All car interiors are made out of plastic, it's just that 9 times out of ten, compared to American cars Japanese models tend to have higher quality materials than cars in its same price range JUST LIKE I SAID. Sit in a '01 Focus, then sit in a '01 Civic. You'll see what I mean. I test drove the new '02 Explorer XLT and the '01 Highlander Limited. The Highlander's interior materials choice, feel, and finishing is much better than the Explorer.