OT:Favor needed

[Mike Schwartz-PC Support & Services]

> It happened with motorcycles too.  Then there was a flurry of small
> cars being imported to the US and instead of making better cars
> the US auto industry got congress to limit the number of small
> cars imported each year.
> 
> But the foreign businessmen realized that if the could sell only
> NN hundred thousand cars each year they would make more money
> if they stopped making $5000 auto and built $30,000 autos.
> More profit per car to boot.  And then the luxury auto industry in
> the US started a decline.

     Actually, the congressional limit helped feed billions of excess
profits into the foreign car manufacturers pockets while they were still
making the smaller cars.

	For example, when the limit was first introduced, a small Toyota
might normally have sold for $3,000.00 or so, if all of the foreign small
car makers had been able to sell all the cars they wanted.  Since there was
a limit on how many could be brought in, Toyota dealers didn't have any on
their lots to sell.  So, Toyota approximately doubled the price of the car,
to $6,000.00 and people were still standing in line to buy more cars than
they could produce.  So, instead of raising the sticker price any more,
Toyota told their dealers (including one who was a friend of mine) that they
were no longer going to allow dealers a $750.00 per car markup.  Now the
dealers were only going to get a $200.00 per car markup.  Dealers had to put
an "additional dealer markup" on the price sticker of each car.  Dealers
kept upping that until they got to the $2,000.00 additional markup level
before the waiting lines for the cars finally tapered down to a manageable
size.  So, Toyota was able to advertise a car for $6,000.00, but when you
got to the dealer, you found out that the car would actually cost you
$8,000.00.  And you still had to wait for one!  

	So, in summary, the foreign car makers waltzed to the bank with an
*extra* $3,000.00 in profit on each car, thanks to the congressional ban.
And the Toyota dealers weren't complaining, either.

Mike Schwartz