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From showroom price to carmaker profit in Europe
The prompt
Kavrin Motors (a fictional carmaker) sells a compact car in Germany for EUR 30,000 including 20 percent VAT. The dealer margin is 8 percent of the price before VAT. For each car, parts and materials cost EUR 16,000, assembly labor EUR 1,500, and logistics and warranty EUR 1,000. Fixed costs (plants, R&D, overheads) are EUR 3,000 per car at planned volume. What does the carmaker earn per car, and what is its operating margin?
Your interviewer will share data as you ask for it. Ask clarifying questions, state a hypothesis, then lay out your structure out loud before you calculate.
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