I never understood it. There was an auto crisis a few years ago because companies made too many cars that people didn't buy. I won't go into a political debate because I'm sure it would lead to a multi-page argument, but why do companies make cars every single years? It doesn't seem like the cars are any different, except it may have an iPod holder instead of a Blackberry holder (first thing came to my mind). What do you think?
I have the same question. I understand it is to keep people employed but there does seem like there could be a better way. There are too many cars now so why are we making new ones by so many companies. The same thing with houses, why are homes still being built when there are empty houses and homeless people.
Well for starters, a company doesn't make any money off cars from previous years. Once they're sold, that's it. In order to continue making money, they need to keep making more. They need to come up with new ideas and then get others to buy those new models. I do understand that you might want them to consider just making them every couple years, but a lot can happen in a year and they can't fall behind.
Exactly, the only way an auto company is going to make money is to make new products. Even though there are perfectly good used cars out there, they don't make money from those used cars. And if you are going out to buy a 'new' car and it's 2012, but the car hasn't been made new since 2010, you aren't going to buy a car that's 2 years old, even if it's never been owned.
Each year the car companies need to make new cars to keep up with the demand of new buyers. There may not have been as many new buyers, but there are always people who need or want to purchase a new car. To be competitive, the car companies add little special details to stand out from the competition.
Though it may seem like most manufacturers have large surpluses, this is actually not true. Many people still buy new cars, and so demand keeps right on par with production. The only reason that the "Big 3" Detroit automakers crashed was because they were losing to competition from overseas. All these other companies - BMW, VW, Toyota, and Honda, to name a few - were doing well, and continue to do so. What has to be understood is that cars don't stay on the road forever (over 5 million cars are totaled every year), and so a continual new source is necessary to introduce new models. In addition, you have many business customers that buy in bulk, either for corporate fleets or as part of a rental company. Finally, most "new" cars have only subtle changes to their overall design and layout, so it is not a "new" car being made, but rather a more (usually) refined version.
I think they make new cars every year because they want to stay ahead of the game. The new cars have something their previous predecessor didn't have and people are always looking to buy they latest and greatest. Also, if they fell behind in this other car companies would out sell them and that company would see pretty bad quarterly reports for thet year.
