The new car pricing formula has been unveiled by the Competition Council after months of waiting, while not only does it not seem to be a cure for the car industry, but it will fuel market inflammation and reduce purchasing power.
Khodrocar - According to Reza Shiva, head of the Competition Council in the new pricing formula, car prices are supported by the organization every three months, and inflation no longer plays a role in determining prices, and will focus on the average market price. Accordingly, in the winter quarter, price changes will be based on market prices.
According to forecasts, the important point of the new pricing formula will be the issue of production, and if production does not increase, the price will not increase, so the pricing of 55% of cars will use the old formula of the Competition Council and 45% of the new formula. .
Experts in the automotive industry believe that this pricing formula, like other decisions of the council, will not only not cure the pain of this industry, but will also cause short-term inflammation of the market, but ultimately purchasing power will determine the prices.
"Undoubtedly, the market IQ is very high and it makes very smart decisions, and no matter how much the prices fluctuate, the market will go its own way.” Farbod Zaveh, expert of auto industry told khodrocar reporter.
"Since there is no change in these sectors, we certainly can’t expect inflation to decrease and prices to stabilize, and the monthly price floor will see a 4% increase in prices, but sometimes it is far from this average price. This gap creates the ability for some goods to return to a fraction of previous prices. On the other hand, there is a limiting factor called purchasing power, and it is not the case that if people increase uncontrollably, they will continue to buy.” He said.
"These conditions are not limited to the car market, and in all markets, we see even basic goods, which increase sharply with increasing prices and decreasing purchasing power.” He said.
"Shiva's remarks in a special June news interview about a 40% reduction in car prices with the implementation of a new pricing formula, while today, despite a 40% reduction in car prices compared to November, it is still twice the June price, so he is qualified to comment. The price of the car can’t be confirmed.” Says Zaveh.
"The price increase after the new pricing formulas of the Competition Council has always been attributed by the chairman of this council to the traders and intermediaries of the market, so I believe that as the market has never reacted to his statements, this time with this decision. It will be inflamed, but this inflammation will not last long, and the market will return to normal.” He continued.
"Compared to 1996 and the implementation of fiscal policies, it is clear that we are now at the bottom of inflation and there is a possibility of further price reductions, which is not operational for car companies because the prices of their raw materials are not such that Reduce the price by increasing the circulation because the price of raw materials is defined based on the international market, so if nothing happens in the country's macro-area or a decision is not made about JCPOA and even the FATF, we will see a creeping slope in the price of high-volume cars. There was and there will be no leap.” He said.
"These cars are still a long way from their inflationary price, and companies are trying to maintain this gap with new pricing, so that all these companies announced their new prices last week to this distance. The price will remain the same, which does not seem to be a success, as the prices of Chinese cars at the factory and the market are currently 10 to 15 percent different, so the market price is lower than the factory price. They are still a long way from their real prices, and they have calculated the price of cars in dollars around 50,000 tomans, and they had already gone to the second round of Trump.” He added.
"Therefore, the market will not see a jump in prices, except for an increase in the price of inflation, which is lower than the general inflation rate of goods due to a decrease in purchasing power.” He said.
According to forecasts, the important point of the new pricing formula will be the issue of production, and if production does not increase, the price will not increase, so the pricing of 55% of cars will use the old formula of the Competition Council and 45% of the new formula. .
Experts in the automotive industry believe that this pricing formula, like other decisions of the council, will not only not cure the pain of this industry, but will also cause short-term inflammation of the market, but ultimately purchasing power will determine the prices.
"Undoubtedly, the market IQ is very high and it makes very smart decisions, and no matter how much the prices fluctuate, the market will go its own way.” Farbod Zaveh, expert of auto industry told khodrocar reporter.
"Since there is no change in these sectors, we certainly can’t expect inflation to decrease and prices to stabilize, and the monthly price floor will see a 4% increase in prices, but sometimes it is far from this average price. This gap creates the ability for some goods to return to a fraction of previous prices. On the other hand, there is a limiting factor called purchasing power, and it is not the case that if people increase uncontrollably, they will continue to buy.” He said.
"These conditions are not limited to the car market, and in all markets, we see even basic goods, which increase sharply with increasing prices and decreasing purchasing power.” He said.
"Shiva's remarks in a special June news interview about a 40% reduction in car prices with the implementation of a new pricing formula, while today, despite a 40% reduction in car prices compared to November, it is still twice the June price, so he is qualified to comment. The price of the car can’t be confirmed.” Says Zaveh.
"The price increase after the new pricing formulas of the Competition Council has always been attributed by the chairman of this council to the traders and intermediaries of the market, so I believe that as the market has never reacted to his statements, this time with this decision. It will be inflamed, but this inflammation will not last long, and the market will return to normal.” He continued.
"Compared to 1996 and the implementation of fiscal policies, it is clear that we are now at the bottom of inflation and there is a possibility of further price reductions, which is not operational for car companies because the prices of their raw materials are not such that Reduce the price by increasing the circulation because the price of raw materials is defined based on the international market, so if nothing happens in the country's macro-area or a decision is not made about JCPOA and even the FATF, we will see a creeping slope in the price of high-volume cars. There was and there will be no leap.” He said.
"These cars are still a long way from their inflationary price, and companies are trying to maintain this gap with new pricing, so that all these companies announced their new prices last week to this distance. The price will remain the same, which does not seem to be a success, as the prices of Chinese cars at the factory and the market are currently 10 to 15 percent different, so the market price is lower than the factory price. They are still a long way from their real prices, and they have calculated the price of cars in dollars around 50,000 tomans, and they had already gone to the second round of Trump.” He added.
"Therefore, the market will not see a jump in prices, except for an increase in the price of inflation, which is lower than the general inflation rate of goods due to a decrease in purchasing power.” He said.
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