MotorAuthority

EU to create single car market?

Posted Thu Mar 22 2007 9:03 AM by Viknesh Vijayenthiran

It’s no surprise that the price of a car can vary greatly between different countries around the globe. A BMW M3 in the US, for example, is approximately the same price as a 325i Coupe in Australia. What’s strange is the price disparity between member countries of the EU. The supposed ‘single’ market is actually wildly different when it comes to cars, and the European Commission aims to put an end to this.

Wards Auto has reported on a new study that claims the difference in price on a new car between neighboring countries can be as great as 40% - as is the case with the VW Passat, which is much cheaper in Denmark than in Germany, where the car is actually built.

The differences are mainly because countries charge rates of tax on vehicles differently. But because of the EU’s open border policy this has resulted in buyers going to the cheapest country to buy a new car and avoid the high tax rates at home.

Apparently, car makers are keen on the idea as it will reduce complexity and allow them to sell more cars to the right markets. Now it’s just a matter of getting the governments on board.

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• Industry

Reader Comments

• Sat Mar 24 2007 4:28 PM

  NaBUru38 says

  Car prices are different because wages are different, too. A Dacia Logan bought in Germany is obviously more expensive than one boughtd in Romania. If wage gaps are too wide across the EU, you can't expect cars to be sold at the same price everywhere.