what is the cost?

[jan tomaswaki]

Anyone aware the manufacturing cost of a Car and handphone?

[Naka]

Anyone aware the manufacturing cost of a Car and handphone?

Maybe the made & in which country is important to start with.

[HTCHONG]

Anyone aware the manufacturing cost of a Car and handphone?

This is a very broad and subjective question, it is not just a "one sentence" lanswer.
However, viewing from OM (operating margin) perspective, electronics like Handphone should be around 25-35%
and if not mistaken for car industry should be around 60%.

[jan tomaswaki]

This is a very broad and subjective question, it is not just a "one sentence" lanswer.
However, viewing from OM (operating margin) perspective, electronics like Handphone should be around 25-35%
and if not mistaken for car industry should be around 60%.

from what i gather,those days "brick" type handphone only cost USD$2.50 to make when they cost RM6500 each. i was shock ! they tell me the high cost of R&D. For local cars it only RM5-6K to make ,the most expensive part is the gearbox. Believe it ? up to you

[opulant]

from what i gather,those days "brick" type handphone only cost USD$2.50 to make when they cost RM6500 each. i was shock ! they tell me the high cost of R&D. For local cars it only RM5-6K to make ,the most expensive part is the gearbox. Believe it ? up to you

Not possible.. even you exclude fixed costs, only calculate the variable costs, a RM6500 phone cannot cost USD2.5 to make. !!

For local car with price tag less than 30k , maybe it is possible to make a car with 6k manufacturing cost after ALL the investment costs have been completely amortized. What left is just variable labour cost and material cost.

[HTCHONG]

from what i gather,those days "brick" type handphone only cost USD$2.50 to make when they cost RM6500 each. i was shock ! they tell me the high cost of R&D. For local cars it only RM5-6K to make ,the most expensive part is the gearbox. Believe it ? up to you

About USD1300 to make a car or USD2.50 to make a phone?! Are you talking about toy phone and car?!

Does it makes sense when someone quoted this manufacturing cost?! Think from the perspective of raw material, labor cost, overhead and other sunk cost.

Bearing in mind, a manufacturer can't produce every single piece part by himself. If some parts need to be outsourced from skill of economics perpesptive, then the piece parts are even more expensive as your suppliers need to earn too.

Dismantle the car yourself to see how many piece parts are there to be assembled?!

Those with some sense of manufacturing will tell you if making a car is cost less than USD1500, I guess most of them will laugh till drop.

Another piece of information, since Opulant touches on armortization. The standard duration of armotization is between 4 to 7 years depend on the industry. From here you can roughly tell the ROI. Hope it makes sense.

[Henry T]

Cost and pricing are two different things.

A product can cost me RM5 but I will sell it for RM50 if the market can accept this price.

People tend to look at big ticket items but forgetting the small ones. A China made paint brush may cost RM1.00 at wholesale but when you buy it from a neighbourhood hardware store it is RM3.00. Don't forget at the wholesale price there is already a profit margin for the manufacturer.

[opulant]

Cost and pricing are two different things.

A product can cost me RM5 but I will sell it for RM50 if the market can accept this price.

Mooncake is one good example. ..

The cost likely is less than RM2 for one mooncake but it is selling at at least RM15.. and is selling like hot cake...

[jan tomaswaki]

Let's look at the mobile phone, nowadays those branded basic phone selling at RM60-70. How much is their cost to make ? The car ,example engine and gearbox RM3000, tires RM1000,i guess the rest is cheap or no value . When the finish products it goes thru, dealership, sales and marketing, branding etc....so the cost will defintely goes up.

[HTCHONG]

Mooncake is one good example. ..

The cost likely is less than RM2 for one mooncake but it is selling at at least RM15.. and is selling like hot cake...

Seasonal products are unique due to surge of demand by season. Therefore, the selling price can be a vast different but whether are they profitable or not that is next question because some Mooncake manufacturier can't finish selling their products at the end of the season. So, I guess this is a factor of consideration by the mooncake manufacturer.

[HTCHONG]

Let's look at the mobile phone, nowadays those branded basic phone selling at RM60-70. How much is their cost to make ? The car ,example engine and gearbox RM3000, tires RM1000,i guess the rest is cheap or no value . When the finish products it goes thru, dealership, sales and marketing, branding etc....so the cost will defintely goes up.

I know one of the car engine manufacturers, Nidec. The products are not cheap, I am not sure Proton got the car engines from who but I am quite sure Proton don't produce their car engine.

[opulant]

Seasonal products are unique due to surge of demand by season. Therefore, the selling price can be a vast different but whether are they profitable or not that is next question because some Mooncake manufacturier can't finish selling their products at the end of the season. So, I guess this is a factor of consideration by the mooncake manufacturer.

Yes. .. they have to sell at discounted price after the Mooncake festival.

I think the mooncake business here is run as a "cartel". They don't have price war among themselves and each of them selling at very similar pricing. Consumers practically have zero choice in price comparison..

I like mooncake especially the icy skin mooncake.... where can I buy them now..

[HTCHONG]

Yes. .. they have to sell at discounted price after the Mondale festival.

I think the mooncake business here is run as a "cartel". They don't have price war among themselves and each of them selling at very similar pricing..

I like mooncake... where can I buy them now..

Pardon to digress to talk about Mooncake.

In fact all mooncakes taste about the same regardless of brand. Therefore, innovation is crucial for different flavour from others.

Also, mooncake manufacturers spend a lot of money on packaging and advertisements to attract consumers. This is where part of the price we are paying. Right? But I guess it is a tough business, I wonder can they patent the flavour they invented? Or else someone will just copy.

[jan tomaswaki]

Pardon to digress to talk about Mooncake.

In fact all mooncakes taste about the same regardless of brand. Therefore, innovation is crucial for different flavour from others.

Also, mooncake manufacturers spend a lot of money on packaging and advertisements to attract consumers. This is where part of the price we are paying. Right? But I guess it is a tough business, I wonder can they patent the flavour they invented? Or else someone will just copy.

i love mooncakes and the margin is pretty high exclude packaging. Last year my friend sold 50K mooncakes to one of the China Clan Asscociations in Guongzong.

[tupai]

its a cartel for sure. And they are laughing all the way to the moon. But i have to admit to be 'part of that profiteering culture' as we were pioneers in introducing elaborated packaging designs to the industry (learnt from the Japs lah). With expensive marketing consultancy & design cost, obviosly the cost is passed onto you, the eager consumers.

There is this 'shoplot bakery' which only open 3months outta 12. Yup, just to manufacture mooncakes. And thats how high the profit margin is...

BTW, Jan, u going into manufacturing car now? JV with mainland pendatang China? Or selling specially constructed parts? I am sure the margins are good...
which reminds me of a tale (inspired by true event) told of a simple rear signal case O-ring quoted at Shringgit2...is finally invoiced at Shringgit 11...and sold to ploton car blur sotongs for Shringgit20...But thats just a bolehwood movie script lah Believe it or not?