Wednesday, February 27, 2008

$19,995 "OBO"

Quite often, you'll see a forsale ad with the price listed as $xx,xxx obo. Have you ever wondered what that "obo" really means? Is the seller willing to take the best offer below his asking price or is the seller looking for the best offer over his listing price? A quick scan on Yahoo Answers revealed that "obo" means different things to different people and there's plenty of confusion. Either way, what should you offer when you come across an "obo" price ad?

With PriceHub, we take the guesswork out of these "obo" listings. By fully disclosing actual sale prices of cars & trucks, we help buyers make fully informed decisions about their offer prices for cars & trucks. The next time you come across an "obo" listing, hop over to PriceHub and check the actual sale prices of the car or truck you are interested in. Armed with these real transaction data points, you'll be able to make a bonafide offer that is reflective of true, fair market value.

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Wednesday, February 20, 2008

SMART Car Price Premiums over MSRP

During one of my recent trips to Europe, I was struck by the large number of super small cars driving around their cities. From Paris to Prague to Rome - the streets were littered with these tiny little cars. For the overly congested European cities where space is at a premium, these tiny cars make alot of sense. Just about every automaker had a small version car - the Mercedes A Class, the variations of Fiats and Renaults - the list goes on. However, the one car that stood out was the Smart. The Smart was the most popular of these cars and it was arguably the best looking. Whenever I saw a Smart parked, I couldn't help but peer inside to see what it was like. I always thought that it would be cool if they started selling Smarts in the US, but I always thought that these little things would never pass our strict safety regulations. That all changed late last year when Smart began taking $99 reservations for these USA versions. Certified to be street legal here, Smarts were finally coming to our shores.

Initially, the Smart Fortwo is offered in 3 versions: the Pure, the Passion and the Passion Cabriolet, with MSRPs of $11,590, $13,590 and $16,590 respectively. These MSRPs were a bit higher than I expected, since they are about 1/2 the size of a Honda Civic but at around the same cost.

With new car model offerings (which have a cult-like following), I wasn't surprised to see the first 2008 Smart Fortwos selling for well above the MSRP. According to the actual Smart Car prices on PriceHub, Smarts have been selling for quite a bit higher above MSRP:

SMART Pure: +38% over MSRP
SMART Passion: +39% above MSRP
SMART Passion Cabriolet: +33% above MSRP

While my back of the envelope calculations are not scientific by any stretch, they do illustrate the popularity of the Smart so far. I wouldn't be surprised to see these huge premiums over MSRP last for quite some time. After all, it took a few years for Toyota Prius prices to come back to Earth.

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Sunday, February 17, 2008

Sunday, February 3, 2008

Superbowl Car Ads Review

Like millions of people, I watched the Superbowl today and took in all the spectacle, including the Superbowl TV ads. You can always count on the beer companies to spend millions during the Superbowl, but the car manufacturers are also typically aggressive in their ad spend. This year, Toyota and Hyundai went big with 2 placements each. For fun, I thought I would review and rate all of the car-related ads in the 2008 Superbowl.

Audi was the first car manufacturer with an ad in the 1st quarter. I was surprised that they took out a 60-second spot that featured their new R8, an exotic car. The messaging was "old luxury just got put on notice, Audi and the R8 are here". I thought this was a bit of a mixed messaging -- was Audi trying to tout the R8 (currently selling for ~$165k according to as a luxury car, or was the R8 a halo car to emphasize the engineering and performance for the rest of the Audi luxury lineup? Grade: C+

Toyota was next with a Corolla ad, which emphasized features like good sound proofing in a cost efficient car. The ad was pretty mainstream and something that you would expect from Toyota. Grade: B

Next was a Lexus ad featuring the GS in all sorts of drifts and power slides. The ad was very well done and typical in the Lexus style. Grade: A-

In the 2nd quarter, GMC also had an ad for the GMC Yukon Hybrid. The ad was very progressive and showed GMC as an environmentally conscious company. Grade: B+

In the 3rd quarter, Hyundai went aggressively after the luxury makes BMW & Mercedes with their ad featuring the Hyundai Genesis. The pitch was "as spacious as a Mercedes S-class but at the same price as a C-class". This was a very bold statement and we'll have to see if consumers will buy into the Genesis. To get an idea of how much a Mercedes C-class actually cost, check out the various C230 prices at Grade: B+

Also in the 3rd quarter, Toyota showed an ad for their Sequoia SUV. Again, this was a fairly safe ad that was similar to what you would expect from Toyota. No surprises here. Grade: B+

In the 4th quarter, Hyundai came back again with another ad for their new Genesis. This time, in addition to BMW and Mercedes, Hyundai also called out Lexus. The pitch was similar as the first Genesis ad, but this time targeted at BMW with a "more spacious than a BMW 7-series, but priced like a 3-series" messaging. For a sample of what the BMW 3-series might actually cost, check out Again, very bold and we'll have to see if consumers will buy into it. Grade: B

In addition to the car manufacturers, Bridgestone Tires,, and Garmin also had prominent ad spots.

The Bridgestone ads were well done, clear in the messaging, and were my favorite ads during the Superbowl. Grade: A

On the other hand, the ad was a bit goofy but still somewhat entertaining. Grade: B-

The Garmin ad was similar to the ad, a bit goofy but still entertaining. Grade: B

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