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Vehicle buyers who are planning to purchase a pickup truck should be aware that they are expensive because of multiple factors like greater demand, improved design and higher profit margins.
While the prices of all vehicles including cars has increased in the last few decades, it is observed that the increase in the price of the pickup trucks is far higher when compared with other vehicles. The real reasons why pickup trucks are becoming more expensive compared to cars are discussed in greater detail below to help those who are planning to purchase a vehicle.
There are multiple factors which have led to the increased pickup truck demand. Many professionals, small business owners require a vehicle which they can also use for carrying heavy loads, which most small cars cannot carry. They may also want a rugged vehicle suitable for all terrains.
So instead of purchasing multiple vehicles, they will prefer to invest their money in a truck, which can be used for multiple applications. Some vehicle owners have limited parking space at their workplace or home, they can park only one vehicle, so instead of purchase a car, they will opt for a pickup truck.
The pickup truck is more rugged in design and will usually last for many years, typically twenty years or more. Hence the resale value of a pickup truck is more, so many people prefer to invest in a truck, which they can resell at a higher price compared to a used car. Some of the more expensive cars will lose approximately 70% of their value after five years, while the corresponding loss of value for a truck is only 43%. It is also easier to sell a used truck, due to the increased demand, while it is more difficult to sell used cars, which require more repairs.
Earlier, when fuel prices were high, people would not purchase pickup trucks, which consume more fuel because they would have to pay more money for fuel expenses.
In the last few years, the prices of fuel have remained low, so people are not concerned that they will have to pay more money for the fuel which the pickup truck requires. Also during the recession a decade ago, few people purchased new trucks, so the number of used trucks which are available for sale is less at present. Since they cannot purchase used trucks, people are forced to purchase a new truck.
Improved vehicle design
While a few decades ago, the pickup truck was mainly a electro-mechanical vehicle, at present, most manufacturers are incorporating the latest electronics in the truck for safety and to automate vehicle use. Typically the new models of trucks have at least five microprocessors to control the truck.
They also have guided parking, collision prevention, cameras, sensors, wireless charging, WiFi and other features.For greater comfort, the truck will have a HVAC, heated steering and seats, stereo systems and leather seats. All these new features will add to the cost of the pickup truck since the company manufacturing the truck is investing money on development.
Compared to cars, the vehicle manufacturers are having a higher profit margin for the pickup trucks which they are manufacturing. They are aware that there is more demand for the trucks which they are making, so they are keeping the margin high, often $15000 for some truck models.
The dealers are also having higher profit margins on the top selling pickup trucks which they are selling, which is usually more than what they get for cars. It is also more difficult to bargain with the vehicle dealer to reduce the truck price, because the dealer is aware that there are many buyers interested in purchasing the popular trucks.
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With fuel prices remaining low for the last few years, businesses and individuals find that they have to pay less for fuel, so pickup trucks which are more powerful though less fuel efficient are becoming more popular.
A pickup truck is extremely versatile, it can be used for transporting family members and also for carrying goods over long distances. Hence families and businesses who have funds and parking space for only one vehicle, are preferring to purchase pickup trucks which have a better resale value, and are in greater demand.