Thursday, March 02, 2006

The Price of Status in Korea

To follow up on yesterday's topic on Korean luxury cars and status. I've been asked "What do the luxury imports cost Koreans?'

Korea luxury import cars are disproportionately expensive in Korea compared to the U.S. or even Japan.

For example in Korea a Lexus LS430 costs around $115,000 including VAT. {There are about 11 VAT's in Korea} The same model costs half that in the U.S., where the price tag is about $56,000.

Even with all the extras, U.S. consumers can buy the LS430 for $74,000. That means Americans pay $40,000 less than Koreans.

The same is true for the Mercedes Benz SL600, which costs $261, 000 in Korea, but about $140, 000 in the states

This means that status can costs lots in Korea...a price tag many upwardly mobile Koreans will pay.

BTW My firm Bridging Culture did a study on the Korean import car tariffs and VATs. It's available upon request.

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