Low End Sedans (under $16k)

backy · December 2001

Sprint/Metro?

backy · December 2001

Coolguyky7, did you read the sedan comparo in C&D that you referred to? It was actually quite complimentary to the Hyundai. Now granted, these were mid-size cars, not low-end cars, but I take your post to refer to American vs. Korean cars in general. There were many positive comments made about the Hyundai's smoothness, quietness ("Lexus-like"), build quality, strong performance (bettered only by the 240hp Altima), fit and finish, interior (including "beautiful" leather seat seams), dash appearence, driver's seat comfort, driver's visibility, rear seat room, etc. Of course, the Hyundai finished fourth, so there were some things the editors didn't find so great, like the handling, and fuel economy (tied with Accord for the lowest in the test).

But I thought the most interesting part of the XG350 review was at the end:

"There's a sense of deja vu about this car--solidly constructed, fairly priced, and fully equipped--at an as-tested price of $24,572 with no options. Japanese cars built their reputations that way, remember?"

I think GM, Ford, and DaimlerChrysler should be more worried about this test than embarrassed.

protegextwo · December 2001

I think GM, Ford, and DaimlerChrysler should be more worried about this test than embarrassed.

Backy, I would purchase XG350 before a any Big 3 offering. I'm being "dead nut" honest. Hyundai, is getting credit all the time, for there vastly improved vehicles. I'm not convinced that KIA or Daewoo is able to build tight reliable cars, yet. However, Hyundai has converted me. I'm very concerned about their resale value. That would hold me back. But, if I had to choose between domestic and Hyundai,... Hyundai wins.

Nah, not a Sprint or Metro. It's so cool. You'll never guess. I was pretty sure what vehicle I was getting, however I needed to see if they could upgrade me for free. No go, soooo I drove my wife, son and myself from Ft. Lauderdale to Key West, round trip in a _________________?

-Larry

backy · December 2001

There aren't many choices left. InterAmerican advertises the Metro on their Web site. The only other verrry small new cars I can think of are the Lanos, Accent, Rio, and Esteem. Or maybe at that price, they're renting Yugos? ;-)

I once went for the "economy special" rental and got a Chevy Sprint 2-door with a 5-speed to drive between Houston and Austin. In July. At least it had A/C; the speed decreased about 5 mph when it kicked in. My wife was not impressed by my frugality. I made it up to her (sort of) last March on a trip to San Francisco; got a Lincoln LS (company-paid fortunately!). It was fine for cruising California 1, but I'd rather have a small car for daily use.

protegextwo · December 2001

OK, a KIA Rio!!! What a riot. Power steering, auto tranny and air. The rest you do yourself! That car put the Low End in "LOW END CARS: Japanese vs. American vs. Euro vs. Korean. HEHE, really not all that bad, I just forgot what it's like to drive a real small econo car!

-Larry

mdaffron · December 2001

Get your butt back over to the Protege topic and stop slammin' those Ko-reans.

(BTW Pat, how many Koreans-vs.-the-World topics are there, under different names, on Edmunds now anyway?)

Meade

P.S. Larry, you think that Rio was a small car, you shoulda seen ME (you know how big I am) in a 3-cylinder Geo Metro while my truck was in the shop in '99 ... all that thing needed was a cutting deck and a rear bagger!

mdaffron · December 2001

I LOVE my George Foreman grill. Takes the place of my Sunbeam outdoor grill all winter long. And cleanup's as easy as 1-2-3!

Happy eatin's,

Meade

mdaffron · December 2001

You could rename this topic:

"Grills, Kias, and Other Appliances that Generate Heat and Go Nowhere Fast."

;-)

majorthomecho · December 2001

I thought my suggestion to change the name to Free For All was okay, but I thought lleroi post about wanting to grill me was very funny.

Seriously, I think we should at least drop the European from the title as has been suggestion by another. And I would make one change to my serious title suggestion. It should be Low End Cars Under $15,000:.... Some people might not understand the lesser than sign from my original suggestion and changing it to the word under makes the meaning clear for everyone.

protegextwo · December 2001

"really not all that bad, I just forgot what it's like to drive a real small econo car!"
-larry

I would never buy a vehicle that small, so it's hard for me to compare it to other similar vehicles. The KIA RIO had some good qualities. Overall, after 600 miles of travel, I wouldn't recommened this car to others.

-Larry

mdaffron · December 2001

I'm interested in hearing why you wouldn't recommend it to others, Larry. That is what this topic is about, and I'm eager to learn.

Meade

claywaterfill · December 2001

That is a good question--why not? Please don't say things like road noise or loud engine because, remember, this is about a $9000 car. Which new car in the $9000 to $10,000 range would you buy in it's place?

shrique · December 2001

I would pick up a 97/98 Mazda Protege or Honda Civic. You get a decent car with excellent projected reliability and more features. You may have to look but I think the more car for the money part is worth it.

claywaterfill · December 2001

But I said new car. Say you were having to scrape together the $185/mo--or whatever it would be--just to buy a Rio. You don't have the money to replace the transmission in the Protege 4 years from now because the guy who had it first dogged it out too much. In a Rio, that transmission is covered. Remember, MOST Rio buyers are not buying them because it's the car they always wanted. They're buying them because they want a new car (for maintenance reasons) and this is the best they can do.

csandste · December 2001

The Rio IMHO is a step backward, even if it's based on the same platform. Don't like that shift linkage, the Festiva was much better--maybe because of its Mazda heritage. I've never driven an Accent, but sitting in one, it impresses me more than the Rio. I only paid $11.2 for my Elantra with group 2 convenience package. That extra 2 grand gets you a lot more car. Either that or a late model used Pro or Civic, or a 2000 Elantra which would still have the remainder of 60K in warranty.

protegextwo · December 2001

I'll review the 2001 Rio, however I'm not going to slam this car. It kind of grew on me as the week went on. I'm a little busy right now. I will get back to the review later tonight.

-Larry

coolguyky7 · December 2001

concerning that quote...

I didn't make any additional comment because I think it can be taken one of two ways. It can be complementary to Hyundai that it did better than the American makes and followed right after the Japanese. However, the writer did say it was embarrassing that the Hyundai outranked those American makes. The corollary to that would be that Hyundais don't have a reputation for being a good car. I just left it free for interpretation.

backy · December 2001

on the Edmunds.com Preview--the link is on the home page. They have the first pictures I've seen of the rear end and the interior, and more details than I've read anywhere else about this new design. If the car drives anywhere as good as it looks, and Hyundai can keep the price down (please, please) they should have a hot seller. But they'll probably ruin it for people like me who need seating for five in a pinch, and put only 2 seatbelts in the back.

bill_1 · December 2001

Backy, I am not sure how much attention you paid, but it looked like there was essentially no leg room for the rear passangers in that car. The Tiburon looks like its going to follow the same formula as most sporty coups, rear seats are for appearance sake or maybe children only.

claywaterfill · December 2001

I agree with you. I would rather pony up another 2 grand for an Elantra myself. I would also buy an Accent over Rio. I was just talking about the person scraping just to get the Rio. At least it's new and has a 100,000 mile powertrain warranty.

shrique · December 2001

Those are just for stuff anyway. (GRIN) I read in C&D that the outside had been designed by Pinafarina (sp) It shows! That is one pretty looking car. Compared to the old one it's like the catepillar and butterfly syndrome.

majorthomecho · December 2001

Clay, does this mean that you think only people whose car cost the same amount as another should judge the second car's engine noise?

FWIW, the Rio's engine is very noisy when you push it to the limit, imo. I have experienced the noise first hand.

claywaterfill · December 2001

It means of course there will be engine noise. Probably a lot of it. If you read my post again I tell you to remember it is a $9000 car. How much insulation and sound dampening do you expect to get for 9 grand? It's like on my Sephia. I don't expect it to perform or sound like a more expensve car. They could make the Rio "Lexus quiet" if they wanted to, but it would cost you.

majorthomecho · December 2001

Perhaps it is the amount of sound dampening material, I really don't know.

What I do know is that I was cleaning my Echo and there didn't seem to be much sound dampening material in it.

What I also know is that the noise of the engine under exertion in a Rio is more than the noise of the engine under exertion of my Echo.

backy · December 2001

And your ECHO cost how much more than a Rio? Take the difference and apply it to some engine refinements on the Rio, and that could make a difference. Sometimes I think we expect too much from cheap cars like the Rio, Lanos, and Accent that exist only to fill basic transportation needs--and do so very well, compared to comparable cars from years ago.

shrique · December 2001

I know you can get a stripper Echo for $10500. The Stripper Rio is $9000 even. About $30 a month difference.

claywaterfill · December 2001

I've seen Rios advertised in the paper at Mall of Georga Kia near Atlanta for $7990. At this price level, that is a huge difference.

shrique · December 2001

I could not bring myself to buy a car that was that low on the totem pole. I would still rather buy a better driving better feeling car that was used and take my chances. When you compare reliability of a new Daewoo and a used Honda I would still rather take my chances on a certified used Honda. Reliability and feel means a lot to me. I've purchased many used cars and never had any problems mainly because I've picked reliable well rated cars and done my research. I get more car for he money.

Now thats my opinion. I'm not attacking anyone it's just that I belive that a good used car is better than a cost effective new car.

shrique · December 2001

Heres a good link that goes in depth about the issues.

http://beta.cars.com/carsapp/national/?srv=parser&act=display&tf= /advice/shopping/newused/newusedindex.tmpl

Sorry It wouldn't let me post the link in full. the link has a space in the middle.

majorthomecho · December 2001

The base MSRP of the Echo and the Rio are not that far apart. It is options that cause the price difference to greatly increase and not the fact that one may have a more refined engine or more sound dampening.

At least that is my opinion.

backy · December 2001

engine refinement could $1500 per car buy? (Per month cost is moot when talking about what the manufacturer spends on the car.) My opinion is, quite a bit. And an earlier post noted the ECHO doesn't have that much sound insulation, and I doubt the Rio does, so that probably is not where the extra money goes. (I guess some of Kia's money goes for the spiffy driver's arm rest. ;-) )The ECHO, and all Toyotas, are noted for their refined powertrains; that takes investment.

protegextwo · December 2001

Ok, I rented this little pup for $105.00 plus lots of Florida taxes, etc. Still, I real nice rate for a weekly rental, over Thanksgiving week. When, I got to the TransAmerican rental desk, the agent offered to upgrade me to a Ford Focus for $5.00 more a day. Well, I really wanted to drive a Korean automobile! So, I declined the upgrade and saved the $35.00. The shuttle took my small family to the off airport rental lot. We hopped in a snazzy looking Classic Red Kia Rio and off we went. We drove south from Ft. Lauderdale to Key West.

To be continued-

-Larry

majorthomecho · December 2001

The title of your thread says Sephia, but the body says Rio. Which one was it?

majorthomecho · December 2001

Backy, the difference in MSRP between a base Rio and a base Echo is not $1,500. It is $900. My source is Carsdirect.com.

Anyway, don't you think that some of the price difference is attributable to non parts cost, i.e., labor and currency exchange rate?

The labor in Korea is cheaper than in Japan and the won is not as strong as the Yen against the dollar.

majorthomecho · December 2001

I should have finished my thought and pointed out that the weaker a currency is against the dollar, the cheaper (in dollars) a maker can price their wares and still come out ahead when the dollars are converted to their own currency.

Let us say that two makers want to get one thousand units of their own currency for the product they sell over here.

Let us further say that maker A's (Toyota) home currency is worth fifty cents in American money while maker B's (Kia) home currency is worth twenty-five cents in American money.

This means that maker B can sell his product for half the price (in American dollars) that maker A does and by these prices both would reach their target of getting one thousand units of their own currency after the exchange of dollars into their own currency.

claywaterfill · December 2001

There has been a lot of talk about quality and real world data. I went to alldata.com and found the 2001 Sephia had no recalls and only 2 Technical Serice Bulletins. The 2001 Echo had no recalls, either--but 11 TSBs. It looks like they are not too far apart. My 1995 Sephia also had no recalls, but only 10 TSBs. Even the 2000 Echo had 33 TSBs. I wonder went wrong at Consumer Reports?

majorthomecho · December 2001

Did you see what some of the TSBs for the Echo were? Some of them were on labels and manuals. LOL. Some did look serious though.

I don't have a subscription to Alldata so I can't get the complete story on the TSBs.

FWIW, none of these TSBs are on the NHTSA site. In fact, there are no TSBs listed for the 2001 Echo on the NHTSA site. Does anyone know why this is?

BTW, I also checked out the TSBs for the 2001 Sephia and they were pretty stupid too. I also checked out the TSBs for the 1995 Sephia and I found myself with a question. Alldata says that one of the TSBs covering the 2001 Sephia has a release date of November of 1999 and one of the TSBs for the 1995 model year was supposedly released in 1987. Just how long is the production run on a Korean car, anyway? : )

Seriously though, this little error seems to throw doubt on the validity of Alldata's reporting. And I am not talking just for what they report on the Echo, but what they report for ANY vehicle.

In regards to what happened at Consumer Reports, perhaps the TSBs do not affect every Echo out there and perhaps some of the issues the TSBs address had not shown up at the time of the survey.

In other words, these TSBs do not necessarily make the results of the Consumer Reports survey invalid.

FWIW, I seem to have escaped some of the problems that the TSBs for the Echo seem to indicate.

shrique · December 2001

Consumer reports is dead wrong on all accounts because it doesn't like your car as much as you do.

Enjoy your Sephia.

majorthomecho · December 2001

When I go to the NHTSA site and check for TSBs, I specify the vehicle as the first search criteria and then I select a specific year. I mistakenly thought that would bring up all the TSBs for that year.

I went back and did a new search for TSBs on the Echo. First I specified equipment which brought up two TSBs. I then did a search on the vehicle and specified the year 1900. Yes, I know that the Echo was not built in 1900, but this is evidently a way to tell the computer to bring up all the TSBs on a given vehicle. Ten TSBs came up, but these ten and the two I found by specifying equipment were for the 2000 model year and none affected the entire production run of that model year.

Thus my explanation as to why Consumer Reports' survey results can still be valid looks to be quite probable.

protegextwo · December 2001

"The title of your thread says Sephia, but the body says Rio. Which one was it?"
-Tom

Sorry, my bad. It was an 2001 Kia Rio.

-Larry

backy · December 2001

The MSRP of a base 2002 Rio 4-door sedan according to Edmunds.com is $9095. The MSRP of a base 2002 ECHO 4-door sedan is $10,585. That is a difference of $1490, not $900. It is not apples-to-apples to compare the price of a 4-door model to a 2-door model, since 2-door sedan prices are typically lower than their 4-door counterparts when equipped the same.

backy · December 2001

If labor rates and exchange rates are such a major factor in car prices as Major claims (and I agree they do factor in to some degree), why don't cars such as Focus and Sentra that are made in Mexico (low labor rates and exchange rates) cost less than they do? For example, the '02 Sentra GXE, when equipped comparably to an Elantra (with side air bags, ABS, and CD stereo), has an MSRP of $14,857. The Elantra GLS' MSRP is $13,774, over $1000 difference. Given the low labor rate and exchange rate in Mexico, shouldn't the prices be closer if your theory holds?

Here's another interesting fact, I think. I searched for labor stats for Japan, Korea, and Mexico and found some (but not for Mexico) on

http://146.142.4.24/cgi-bin/surveymost?in.

I used the "Manufacturing Unit Labor Cost Index, U.S. Dollar Basis" because it was available for both countries. Note that this is for all manufacturing, not just cars. The latest indexes, for 2000, were 102.5 for Japan and 67 for Korea. This shows that at least as of last year, unit manufacturing costs are considerably lower in Korea than Japan. But here is the real interesting fact: in 1996, the index was 109.6 for Japan and 123.3 for Korea--meaning that unit labor costs were higher in Korea than in Japan five years ago! Then by 1998, the index had dropped into the 60s in Korea, but was still close to 100 in Japan. Now consider how this index is calculated: by dividing hourly compensation by productivity. So if the index goes down, either hourly wages are dropping or productivity is increasing, or both. I find it hard to believe that hourly compensation in Korea has been cut nearly in half since 1996, but I suppose it is possible--perhaps a poster who knows more about Korea could comment. I find it more likely that the plunge in unit cost index in Korea is due mainly to increases in productivity.

In case anyone wonders, the index for the U.S. was 93.5 in '96 and 89.9 for '00.

majorthomecho · December 2001

Backy, you can compare the price of a 2 door Echo with the price of a 4 door Rio because the base 2 door Echo and the base 4 door Echo come equipped the same, have the same engine, and (presumably) have the same amount of sound dampening material. And these last two items are what we are discussing when it comes to engine noise.

The difference in price between the 2 door Echo and the 4 door Echo can be explained by the 4 door having two more doors.

Or do you think that when the line sees they are building a 4 door Echo, they put in a different engine and more sound dampening material because hey, it is going to be more expensive than the 2 door?

majorthomecho · December 2001

I briefly touched on something in my post about the Yen and the Won that might explain why Mexican made cars are not cheaper.

It has to do with the amount of their home currency a company wants to see after converting from dollars to whatever their currency is. Remember I brought this up.

But see, Ford's home currency is not Pesos. Their home currency is dollars. There is no difference in currency rate that Ford can exploit when selling in the United States.

Also, who knows how much profit Ford (maker of the Focus) and Nissan (maker of the Sentra) want to see. Perhaps they want the extra profit generated by the lower labor cost to go to themselves and are unwilling to pass the savings on to the consumer.

You bring up a good point, but it does not necessarily invalidate mine.

BTW, that point was that SOME of the difference in price between a Rio and an Echo could be explained by the exchange rate and labor cost. This does not necessarily mean I think it is the major reason which is how you characterized my possible explanation.

spiritz · December 2001

And allow me to add something.
Labor cost does not influence that much to prices of cars. If it did, almost every carmakers would have rushed to China.
Back in '60s labor cost means major factor, though.
Go visit modern automobile factory(I did several times)...like Toyota, Honda, or even Hyundai.
Robots(welding assembly or pincher attached to arms) and N/C controller do the MOST of the process(molding, carrying, assembling, painting, adjusting, you name it). In fact, there're very little room remained for real men.

Major, you are correct in the most part. Exchange rate is the keypoint. But I'd like to point out something else.
About Korean won - U.S. Dollar exchange rate, it moved from 1,370 to 1,600 Won against 1$ in 1998, and 1,250 to 1,300 in 2001, if I'm correctly recall. Hyundai HAD TO RAISE THE PRICE OF THEIR CAR by 15%-30% at laymen's calculation, but they didn't(they've kept the price low).
Neverthless, their net-profit/vehicle ratio soared by almost 150% in 3 years. It's profit/sales ratio is somewhere around 10% in 2001, which is phenominal in the industry(Big 3? I guess around 3% at best, or even below horizon in the last Q 2001_ due to desperate 0% financing, whatever).
To keep the balance with Big 3 or some Japanes carmakers, exchange rate should be worsened against Hyundai by 10% right now, and Hyundai should cut the price by 5% at the same time(It will break even).
But again, their productivity and efficiency have grown so rapidly, it might not break even in 2002.

So, I don't think Hyundai is just dumping their cars, and their ability to keep the price low is not mainly due to exchange rate.
I just envy that Hyundai earns lots and lots of money at the price level that we think it a great bargain.

spiritz · December 2001

I estimate Hyundai earned at least 1,200$ when they sell you an Elantra. So you do not necessarily need to feel guilty for having taken advatage of Hyundai =^.^=

I'll let you know something else.
Great amount of plastic parts(including gearshift knobs!), various sensor/controller, A/Cassembly, seat assembly, suspension assembly, even part assembly of powertranny used to make Japanes cars and Big3's, or even some European cars are made in Korea nowadays.

For example, Backy, you'd have noticed that the seats of Elantra felt more comfortable and supportable that competition. They(or same level quality and different design) are used to make $20,000+ cars in competition.

I laughed to death to read a message in this townhall, claiming that Hyundai does not produce all-aluminium engine, nor varriable intake system, etc, etc, and interior material is not up to Japanese "low-end" cars.
In fact, Hyundai designs & produces all-aluminium engine, adapting some advanced technology(compared to Chrysler, not quite Toyota's or Honda's level of technology, of course) and for interior materials, I bet they will definetly fail to distinguish Korean low-end(or even higher level) cars between any other low-end(or even higher level) cars on the planet if the cars were completely new to consumers and covered all over except interior by some materials.

How ridiculous.

-Spiritz-

backy · December 2001

Interesting and informative comments on exchange rates, profit margins, parts etc. Thanks much.

backy · December 2001

>>> The difference in price between the 2 door Echo and the 4 door Echo can be explained by the 4 door having two more doors. <<<

Exactly! Therefore, when comparing the price of a 2-door ECHO to a 4-door Rio and stating that the difference is only $900, please remember to add in the cost to Kia of two more doors.

bobbyknight · December 2001

The reason why automakers sell cars in Mexico is to take advantage of low labor costs. Because of NAFTA, many corporations moved manufacturing plants to Mexico for this reason.

"Labor cost does not influence that much to prices of cars. If it did, almost every carmakers would have rushed to China."

I really can't see how that sentence makes much sense. Of course labor costs contribute to the costs of a car, just as much as any other industry. The reason why they are not all flocking to China is because China is a quasi-Communist nation where there are barriers to manufacturing there. Labor rates are not only contributed to assembling cars but also the price of each component manufactured for the car. One reason why Japanese Automakers started manufacturing their autos in the U.S. is because of lower labor costs associated with the favorable exchange rate. Labor is incredibly expensive in Japan. But remember, exchange rates fluctuate rapidily which would explain why Japanese cars were so cheap in the late 80's and early 90's and why the tides have changed since then. Also remember, foreign cars are subject to tariffs and quotas so relocating manufacturing plants to other countries also has its strategic advantages of getting cars in the country.

backy · December 2001

Since there doesn't seem to be much interest in changing the name of this forum, I withdraw my motion. Besides, I remembered that there is at least one European car that sells for under our $15,000 ceiling, and there may be others in the future, so keeping "European" in the name seems like the right thing to do. And people who hang around long enough will learn about the $15,000 ceiling. Who knows, we may decide to change it at some point, just as Edmunds.com raised the ceiling on their low-end car category. Car prices do go up over time.

Low End Sedans (under $16k)

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