And keep in mind that monthly payments have been reduced, in relative terms, due to financing for ever longer periods, from the 36 months that used to be the norm, to 7 or 8 years.
Steve
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Apple do make a cheaper phone: $429
iPhone SE - Apple
Yes, that’s “cheaper,” but not the budget market. Even the bottom of the iPhone line is twice as expensive as the decent (but not great) low-end market. There’s plenty of smartphones that are out there in the <$200 range.
Apple isn’t going to start offering a sub $400 phone just because interest rates rise, even if it might cut back on the number of people who can afford to shell out about half a grand for a cell phone. They might advertise their cheaper offerings a bit more, or perhaps run a few targeted discounts or packages to lure in bargain shoppers (though I don’t think so) - but I doubt they’ll alter their product line to add new, significantly cheaper models at the bottom end of their range.
I suspect plenty of people realize Apple is a cult, much like Tesla. Commodity electronics makers like Samsung will probably never see the margins Apple does, any more than Ford and Chevy will see the margins Tesla has shown.
Steve
It’s possible that Ford and GM didn’t mind the loss of production during the strike all that much. Pre-strike apparently there was something like 65-75 days of inventory on car lots. That’s probably been reduced somewhat due to the strike.
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Sure, but it wasn’t like they picked where to shutdown. They had parts factories idled, car assembly, very little notice, etc. It was disruptive…and meant to be.
But yes, lowering inventory, if it was the right cars could be good. But what if the most desirable models & trims are out of stock now?
Mike
Then they will build some and sell them for an extra 5k?
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By definition, the most desirable models/trims will be in frequent production (which is how they build those variations). So the real question is how long can the companies be out of general production? When the closures began, it was done to send a clear signal. It just took a while for management to figure out they would lose a lot more money when the ATP/GP essentially went to $0. They settled. What they will do next is unknown because there is a new cost formula for future cars. It may push the move to EVs because they are less expensive to build compared to ICE. But there is a 2-3-4 year “gap” until the ability to build the new EVs arrives. The advertising til then will be interesting (get ICE while you still can!!).
When the first plants were struck, the local news gave the days inventory on hand. from memory: Ford Wayne Assembly makes the Ranger and Bronco. The news reported something like 45 days on hand of Broncos, and a little fatter on Rangers. The first Stellantis plant was Toledo, which makes the Wrangler and Gladiator. iirc, Wrangler inventory was pretty fat, but the Gladiator was nuts, something like 180 days.
What I noticed, continually, through the strike, was the local “news”, particularly the “business editor” on channel 4, almost never talked about how much the workers gave up in 08-09, or how much their compensation has lagged that of management since then. It was overwhelmingly “ohh the strike is costing the companies umpteem Billions…ohh the strike is costing vendor companies umpteen Billions,ohh…the strike is making companies lay off thousands of workers…ohh the misery the strike is causing…so horrible”. Bah
Steve