A Product. Three Organizations. Price Difference & Rationale Of
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A Product.
Three different organizations that provide the product.
The prices associated with the product.
What is the difference between the prices among the different organizations? What is the rationale for this difference?
Product: Vehicle Sedan
Maybach = approximately $327k (base model)-$367k
Mercedes-Benz S-Class = approximately $86k (base model)-$140k
Chrysler 300 = approximately $25k (base model) -$37k
Each vehicle was chosen based on similarities in vehicle type. These three vehicles consist of similar framework, which are offered in 8 cylinder, front-engine, and rear wheel drive design, and are four door 4-5 passenger Sedans. Each vehicle, in their respective class, is classified by Car and Driver as a Luxury Vehicle.
In the vehicle manufacturing/design/retail industry, the battle to satisfy the consumer taste, whether it’s for warranties, safety measures, or driving performance, base and overall price differences vary due to vehicle engineering brand, brand reputation, and brand demand. Some consumers ask, “why would I purchase a vehicle that’s the price of a $300k home, when I can purchase a vehicle with similar framework and characteristics for a tenth or a quarter of that price?” Every consumer is different and is unique in their specific fashion. While some consumers enjoy a modest living lifestyle, some consumers are pleasured with a lifestyle of opulence. Based on these lifestyles and the common or atypical demands/tastes of consumers, conglomerates emerge to satisfy each taste. With more than one entity attempting to satisfy one taste within diverse population of demands, competition is formed, and competitiveness is battled with demand production.
As per Car and Driver, the Maybach 57 is created with the finest materials and is made in Germany. European vehicle engineers are considered the ultimate specialists of automobile design and art. Based on their historical productions, Maybach aficionados and several who are consumers, have depended on the Maybach vehicle maker for their designs and attention to the finest detail; in turn, they elude the temptations to experience other vehicles. High performance is a manifestation of the vehicle and since the vehicle reflects extreme luxury, the production in large quantities of this product, is limited. Therefore, its limited availability and demand by certain connoisseurs allows its manufacturer to maintain its price well above $300k. For more affordable luxury, Maybach’s parent/majority shareholder, Mercedes-Benz/Daimler Chrysler, offers a Mercedes-Benz S-Class design. Although the S-Class possesses several similarities with the Maybach 57, it is more reasonably priced (as compared to the Maybach 57) at base of $86k due to mass production, a combination of cost-effective and fine materials, and greater demand. If neither of these vehicles fit within a consumers price scope, and would like to purchase a vehicle with class and performance somewhat similar (not identical) to the above mentioned vehicles, Daimler Chrysler also offers the Chrysler 300 at a modest price of $36k. It's decrease in pricing compared to the Maybach 57 and Mercedes S-class is due to cost effective materials, assembly line mass production, and triple demand over the previously mentioned vehicles
The Rationale for price difference?
Brand reputation, brand name, production, and demand.
~Chris LugTwo






