Chapter XVII – Pricing – Bugatti

Bugatti is a legendary car manufacturer, so in 1998 Volkswagen thought that they will buy the rights to produce the car and reinvent it, and now the company is losing about 1.5 million dollars per car, and that’s because all the research and development costs a lot, and in case of Bugatti nothing will do but the best. And so the car that costs $3 million to produce is now sold for only $1.5 million and until the production ceases in 2011 Volkswagen will lose about $675 million, but in the long term the company will probably gain on that decision because they have reinvented a great car and now they can start producing much cheaper cars and charge a lot more for them.