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Australia is one of the most expensive places in the world to buy vehicles that wear a premium badge.
Compare models sold here from the likes of BMW, Mercedes-Benz, Land Rover and Ferrari with their counterparts in major markets such as the US, Europe, Japan and Britain and there are huge price disparities.
With all the taxes the Mercedes-Benz SLS AMG's price really starts to add up..
It's rarely a matter of tens of thousands of dollars. The same model can cost more than double or even up to three times as much in Australia.
In the most rarefied air of the luxury-car atmosphere, Britons can buy a Rolls-Royce Phantom limousine for the equivalent of $450,000; American buyers can waft along in the stately sedan for $373,000. In Australia, the Phantom costs millionaires more than a million: $1,068,000, to be precise.
Porsche's iconic 911 sports car starts here at $223,000. In Japan, its price tag converts to $134,000. Britain, $107,000. The US, ''just'' $77,200 - cheaper than HSV's Commodore-based GTS.
Range Rover Sport V8 SC is priced well above most other countries.
There's no respite, either, for buyers who can afford only to step into the ''volume'' end of the luxury-car market.
A BMW 320d, for example, requires Australians to write a cheque that's about $20,000 higher than the figure scribbled by British buyers. Or, put another way, nearly a 50 per cent premium.
It gets worse for local buyers, though, as even our home-grown sedans are cheaper when they are sold overseas.
BMW M3 Coupe is almost three times more expensive in Australia than in the US.
When Holden exported its Commodore SS to the US as the Pontiac G8 GT, it cost about $30,000, roughly $15,000 less than it costs here.
Audi TTS, will cost you more than double in Australia than it will in the US.
Inflated luxury-car prices are not a recent revelation but a rampant Australian dollar - continuing to break post-float records as it stretches beyond parity with the US ''greenback'' - has many car buyers again asking questions.
A strong dollar is typically great news for importers but the local subsidiaries of the German luxury car brands say currency rates are established up to a year in advance to keep prices stable.
''We do hedge to protect against currency movements going both ways,'' says BMW Australia head of corporate communications, Piers Scott.
Jaguar XFR is half the price in Britain compared to Australia.
''We don't put prices up when the currency is weak and neither do we respond immediately by putting prices down when the currency is strong. We have to hedge against these kinds of fluctuations for the customers' benefit [so new owners don't see their car discounted just months later]. As a manufacturer, we're not actually in a position to capitalise on a strong Aussie dollar - at least not in the short term.''
Mercedes-Benz Australia agrees buyers shouldn't get too excited about exchange rates.
''The exchange rate we pay for the vehicles, wherever they come from, is set a long time in advance by Stuttgart [the brand's headquarters in Germany],'' says the company's senior manager of corporate communications, David McCarthy.
Lexus RX450h is considerably more expensive in Australia than other markets.
''That currency price is locked in sometimes a year in advance.
''We're buying huge amounts of product; we're not buying some Travelex for Bali.''
BMW and Mercedes-Benz lay the blame for Australia's stratospheric luxury-car prices at the government's doorstep, citing that new cars are burdened with multiple taxes - notably the luxury car tax (LCT).
The LCT was introduced by the Howard government in 2000, with the launch of the goods and services tax (GST). It replaced the wholesale tax that existed during the 1980s - a decade when governments had only just started to dismantle protectionist walls that had been surrounding the local car industry, built from excessively high import tariffs. It was hardly a reprieve for buyers.
Then-treasurer Peter Costello's LCT placed a 25 per cent levy on vehicles costing more than $55,134, a tax that was increased controversially to 33 per cent by the Rudd government in 2008.
A local automotive industry analyst, however, says car makers are potentially taking advantage of the LCT and the fact Australians have essentially been conditioned in the past few decades to higher prices for luxury cars.
''Yes, we have a luxury car tax but other countries have different taxes as well,'' says a lead partner of the automotive industry group at lawyers HWL Ebsworth, Evan Stent. ''[There are] taxes for cars that have a high engine capacity, for environmental reasons.
''I think there's a perception that there's a higher price threshold for those sorts of cars in the Australian market but that's probably more governed by the very high import duties that we used to have and because of the traditionally high price paid for luxury cars, as opposed to the actual value of the car.
''With some of the German brands back in the 1980s, for example, when import duty was about 59 per cent, the imported German vehicles were very expensive in this country. So, because of market tolerance, they probably price them higher than they would otherwise in some other markets.''
Mercedes-Benz says that while its operations in Australia are profitable, the company's pricing set-up works comparably with other markets.
''It would be easy to say we're making huge profits at the expense of the Australian consumer. But that wouldn't be true,'' says McCarthy. ''The margin we work on is virtually the same as the one [Mercedes] works on in every other market.
''The prices of these [luxury] cars are [also] more competitive than they've ever been. If you compare the price of an E-Class, say the E200 CGI, to its equivalent 10 years ago, it is significantly better value now in terms of average weekly earnings and inflation.
''We had 18,500 passenger car and SUV sales last year.
''At the end of the day, if our cars are priced too high, we wouldn't sell them.''
If there's any consolation, Australian showrooms do not display the most expensive cars. Facing prices that, in many cases, are more than double those here, buyers in Thailand are even unluckier.
Note of import
It would cost you only a few thousand dollars to ship a vehicle to Australia, but government restrictions make a ''do-it-yourself'' importation a complicated, impractical affair.
One restriction is that Australians can only personally import a vehicle if they have owned and used it while living overseas for an extended period.
The car must have been purchased abroad, registered in your name, garaged in proximity to your overseas address and owned for at least 12 months continually - and that ''qualifying period'' must have immediately preceded a permanent return to Australia.
Even then, however, there's no escaping the luxury car tax if it's worth more than $57,466. You can apply for a revised value to be calculated for the car if it's not new, but if it's above the threshold personal importers will still be slugged with the 33 per cent tax, as well as GST and customs duty.
One of the few exceptions granted by Department of Infrastructure and Transport rules is the Specialist and Enthusiast Vehicle Scheme, which, subject to approval, allows the import of certain vehicles not sold locally in an official capacity, such as Ariel's Atom sports car.
An ever-changing list of cars that can potentially be brought here is on the department's website (infrastructure.gov.au).
There is another option that allows any Australian to import any vehicle. The catch? It must be at least 22 years old - made before January 1, 1989.
JEZ SPINKS
Edited by Trilogy on 10/02/2012 at 22:33
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