I recently got back from a trip to France, and while I was there I decided to stop by Monaco, the place known by many as “The Millionaire’s Playground.” Before my visit, I spent a reasonable amount of time checking out pictures and videos of the cars and yachts that are commonly seen around the principality, but no amount of Youtube binge-watching could prepare me for how ridiculous the city-state’s citizens are when it comes to flaunting their wealth. To give you an idea of just how amazingly pompous this place actually is, here are a few of the cars that I saw there in a single day’s time:
As I basked in the awesomeness of the outrageous opulence of those around me, a realization came upon me. You see that red Ferrari in the first picture ? It’s an amazing car–it looks great, it has a top speed of 217 MPH, and it’s named after the founder of Ferrari himself. One would wonder what an automobile of these proportions would cost. Could it be $100,000? Or maybe $200,000? Or how about $500,000? Well, you’re close…sort of. At a recent car auction that took place in Pebble Beach, California, the same Ferrari model was sold for $6,050,000. Just take a moment to let that preposterous price sink in. Yes, someone spent over six million USD for a secondhand automobile. Although the Ferrari Enzo possessed the highest valuation, every single car pictured here has a starting price of well over $1,000,000 (with exception to the reasonably priced Porsche 918 which can be yours for only $845,000 without any add-ons).
Moving on to a more important and possibly more relevant matter, which concerns the current automobile price-bubble that continues to inflate with every passing day. Before I begin, I would like to say that I am going to avoid discussing the costs of purchasing so-called Supercars, because we all know that the rich are always going to spend their money on overpriced vehicles. However, I am going to say that these absurdly exorbitant cars have been affected the most by the price spike that has been not-so-gradually inflating over the past ten years. I mean, seriously…$2.2 million! For a car! Throughout the course of history, there have been many overpriced cars, but even after adjusting for inflation using the totally accurate and not fraudulent U.S inflation calculator, no price tag could even come close to matching this figure.
To further justify my statements, here are some facts taken from an article on jalopnik.com showing just how much car makers have raised costs of purchasing their vehicles:
Price in 1965: $6,370
Price with inflation in today’s dollars: $46,795
Price new in 2012: $82,100
Price in 1969: $6,465
Price with inflation in today’s dollars: $40,764
Price new in 2012: $73,200
Price in 1970 (240Z): $3,526
Price with inflation in today’s dollars: $21,029
Price new in 2012 (370Z): $33,120
There is undoubtedly a bubble here, and the real question we should be asking ourselves is: How much longer can it last? When will car manufacturers and buyers realize that prices are out of control? It likely won’t happen for a while, and considering the fact that luxury car sales are currently outperforming standard car sales, it’s just going to get more and more expensive. The only thing driving this price craze is the fact that car makers know that some people are willing to pay over $500,000 for a shiny sedan with enough horsepower to move a building.
All we can do for now is wait for the day when consumers realize that just because a car looks like a million bucks doesn’t mean it should cost that much.