No one has ever thought of the Bugatti Veyron as a steal with its $1 million plus price tag. New research released suggests that it actually costs the brand roughly $6.24 million for each Veyron it sells. This is according to data from the Wall Street research firm Bernstein Research. So why would a company take on such a catastrophic loss and continue to produce?
The estimated loss figures are said to be “very approximate” for the Bugatti Veyron money pit. Bugatti has responded that the figures released are “not plausible”. The numbers are derived from a large R&D cost of $1.62 billion USD and low sales volume. With around 40 Bugatti Veyron cars sold annually since 2009, that does not begin to make a dent. The Veyron is a specialized supercar, however, and was never intended for the masses. The company knew their market limits when creating the beast, and likely planned accordingly.
The Bugatti Veyron Super Sport model is the current fastest production car on the planet. Though there was a bit of a scuffle recently when that title was stripped and then reinstated. The reason the title was stripped after holding it for 3 years was because some argued that the actual production version had a limited top speed. The rules for the fastest production car indicate that the actual car rolling off the production line ought to have the same speed offering, hence the name of the title. Both sides went back and forth, and eventually the title was given back to the Veyron Super Sport.
Overall, the study was an effort to examine the top 10 European automobile models that produced the largest losses for their parent companies. The resulting list suggested that the Volkswagen Group has lost approximately $2.2 billion on the hand-built Bugatti Veyron since its birth. It is unclear if they have taken into account all of the pricey special edition Veyrons that have emerged over the years, like the one-off L’or Blanc and others.
In the end, the parent companies know which models are their moneymakers and which ones they can experiment with and compensate those losses. The 1200 horsepower Veyron has been a gift to the automotive industry with a rich history and is certainly worth the investment.
Post by Imagine Lifestyles Luxury Rentals