So what is so different about the EU market that makes German Automakers think that their vehicles will do better in EU than in the US? The Audi line-up is amazing unless you live in 'merica.

WEAK.

the profit margins...

the profit margins...

Exactly Profit Margin

Audi Q5 new in states is around $42,000
The Audi Q5 I ordered in Feb. is 56,000 euro ($79,000)

Why is Europe getting so gauged in pricing?

Why is Europe getting so gauged in pricing?

Ever hear of VAT?

Nearly 20% built into the price of each product sold.

I don't get the VAT thing... a tax is a tax, profit margins should be more related to what the market can bear, and a higher VAT, if anything, should cause lower profit margins. People have XX amount of money to spend on a car, if more goes to VAT, then they buy a lesser car with a lesser profit margin. Now i agree that prices are definitely higher in Europe/England even after taking VAT into consideration, but i'm not sure we can blame VAT for that.

past discussions have concluded that...

1. profit margin
2. certification
3. not enough buyers to offset (1) and (2).

But if using that logic, why bring the R8 over? wouldn't that have cost a hefty money to get certified for a small volume? Maybe the margins are like 50%. who knows Audi logic.

My 02 allroad was low volume and it made it over.

-ThinkMac-

In Europe you can buy individual options whereas we (in the NA) have option packages. I believe the intent is to group high and low margin options into more profitable packages to ensure that they get the money that they don't on the base price.

The VAT is a national sales tax and it varies between countries. What is different in the European approach is that all prices already include that country's VAT. Here in the US we don't usually quote prices with sales tax. I wish that we did. People would realize what they are actually paying in the end, and we like to hide that.

VAT in Europe makes things much more expensive. I use to live in Scandinavia where tax was at 25% of everything you buy.

The reason why Europe collects a lot of taxes is that the government takes care of you and your medical needs, especially when you retire. College education for your kids are also shouldered by the government. So, there's less need for Europeans to save for retirement.