Prices of the cars

[jkemmery]

I have a question on how you calculate "Total Production Cost". Recently while playing a game, the "Total Production Cost" (I'll abbreviate as TPC) for each of my 12 or so models skyroketed after expanding to Asia and building a factory in Tokyo. My guess for this was that it was due to shipping, as I had the game set to auto production and global shipping. However, that is just a guess. Can you please explain how you go about calculating TPC for each model of car? Because it seemed that suddenly the TPC had jumped to about 5 times the Unit Cost once I expanded to Asia. Thanks.

Read what was written in the posts above. It explains in great detail.


If you expanded into Asia, then you have to factor in all the construction costs of building each branch into the cost of each vehicle produced that turn. The next turn the TPC will decrease as you do not have to pay construction costs.

So, if you spent $100,000,000 to expand into Asia. And you built 10,000 cars. Then additional costs to break even for that turn just from building branches is $100,000 per car.

OK, however, looking at your calculations above, they are only for one model of car. Are you dividing out the corporate costs per model? Because even with the expansion, the jump in TPC per model was excessive. Moreover, shouldn't any capital expenditures be taken out of working capital, and not be figured in to the profit cost per vehicle sold? I mean, that's how real corporations operate. It seems that you probably have some serious calculation errors in the program when you figure these costs. I understand the math above, but, I've worked for several large corporations and this is not the way they calculate profits. My point is that you may want to take a closer look at this, and play around with some scenarios to tweak your calculations. Capital expenditures should ONLY be taken from working capital, not figured in to unit costs. The reason for this is rounding errors. I'm 100% positive you have serious rounding errors in your calculations, and when a company grows to a global scale they compound. For example, I was selling roughly 100,000 vehicles per month on 5 continents. I was profitable until I expanded in to Asia and immediately began loosing money, after only opening 6 branches and 1 factory. I urge you to take a look at how you are going about calculating the profits and make an attempt to bring it in line with the way actual corporations work.