Some Things End Up Being Cheaper in Argentina

[Quilombo]

Hi Everyone,

I just thought I'd share some examples of how distortions in Argentina's macroeconomy can paradoxically result in great deals for consumers.

Previously I've shared some anecdotes about inflation, cuotas sin intres, and goods re-assembled in TDF making tech cheaper here at times, but I thought I'd share some more concrete examples of purchases I've made recently 1st hand, and encourage others to do the same.

Hammer Drill

Long story short the cordless wasn't going to get the job done, so I needed to buy a hammer drill. I picked up a Philco 13mm 710W Hammer Drill, 3,212 reviews, 4.5/5 stars average for $8.000 ARS in 4 cutoas sin intres (via debit, something I didn't know existed). Using this inflation & cuotas calculator I frequently use, this brings the final price I'll end up paying to just shy of $20 USD for a hammer drill based on today's WU exchange rate, when in reality it will be even less as each cuota is paid 30/60/90 days from now.

Checking out Amazon, a similarly reviewed Black and Decker model is $40.00 + tax. While 50% would make sense if it was something produced locally, both models are made in China, so, IMO, it's a pretty good deal.

43" 4K TV

I also recently picked up a 43" 4K TV LG TV for $111,000 ARS in 24 cuotas for 1% intrest/month as part of the ahorra 12/24/30 program. Same TV is 85K if you pay cash, and due to inflation, it brings the cost of the TV to $56,987 ARS, or $186.84 USD for a brand new 4K TV (a good one too, not the knock off Noblex ones).

Checking Amazon, same model is $326.99 USD + tax. Again, an incredible deal

Washer/Dryer Combo

Finally got a washer/dryer combo; the cost of the wash and fold near our apt kept going up where the thing would pay for itself in about a year anyways, and this way we don't even have to leave the house. I found a highly reviewed one for 111K, 6 cuotas sin intres, bringing the effective price to $90,491 ARS, or $296.69.

Checking Best Buy and Amazon, the cheapest options are two separate mini washer and dryer for $329 and $349 respectively, so $678 USD + tax. This unit sits under the counter top like a dishwasher, I press 3 buttons, and 2 to 3 hours later the entire load is washed and dried, and dried dired, ready to fold/hang/put the sheets back on the bed.

This is probably one of the best purchases I have ever made tbh.

So, anyone else have some great finds recently? Finding a way to make inflation work in your favor?

 

[dsp27]

There's no such thing as a free lunch. Someone out there is always footing the bill. Inflation is a poorman's tax. Creating all these market distortions serves a single short-sighted objective and that is to beef up the government's election results, at the expense of the longterm economic stability of the country. Spend now pay later....

 

[toongeorges]

I think the price distortions have more to do with the official vs blue dollar magic than with inflation. I understand there is some system of agro exporters bringing in dollars and then the government giving some importers the right to import goods at the official rate with these dollars.

There have been examples of Audis being cheaper here than in Germany or MacBooks cheaper than in the US. Lately, I wanted to gift an Intuous Pro Medium tablet to someone in Argentina and I thought buying one on my trip home, because electronics should be cheaper in Europe with all the import restrictions here, but then I figured out the price of the tablet here was only 70% of the price in Belgium (and 80% of the US price). I bought two tablets in Argentina, one as a gift to the Argentine and one as a gift to my sister.

You could argue that I swindled Argentina with the gift for my sister, but I did not set up the scheme. Argentina is the one shooting itself in the foot by letting people with connections import cheaply who may then sell the imported goods at a cheap price to someone who takes the goods back out of the country. As far as I know migrations only checks that you do not enter Argentina with too much electronics, they do not check if you exit Argentina with electronics.

Argentina maintains imbalances that stimulate capital flight. It is surely bad for the country, but it is not up to us to fix it.

 

[Quilombo]

There's no such thing as a free lunch. Someone out there is always footing the bill. Inflation is a poorman's tax. Creating all these market distortions serves a single short-sighted objective and that is to beef up the government's election results, at the expense of the longterm economic stability of the country. Spend now pay later....

Oh I completely agree, and it makes the correction that much more painful when it comes, but as @toongeorges said, it's out of our control, so while politicians/judges/the rich here make out like bandits I'm going to take advantage of some deals on consumer goods, because lord knows it won't last once the brecha is gone.

 

[Ries]

There are several different things going on here-

First, of course, is the fact that you can earn in dollars and get the blue exchange rate.
Thats a huge factor, meaning most things are half price.
This is due to Argentine political and economic policies of the government, as well as historical labor and trade agreements.
Argentina is unique in this way, and the blue is a rare gift if you can exchange money that way.

Second, products that are made in Argentina, as many washers are, are actually a pretty good deal even in the black.
We have been looking at a Drean, made here, that is very small, just right for our space, and it goes for around 90,000 pesos.
There are no equivalent size machines in the US market, a small washer in the US is going to run about 1000 dollars, because americans just dont buy the really cheap ones, so nobody stocks them.
We have a set of Turkish made washer dryer in the USA, prepandemic they were around $700 each, now they are more.

Your hammer drill would be pretty cheap anywhere. Philco is not exactly a leading name in power tools. I would rate it equivalent to Harbor Freight tools in the USA, who sell hammer drills for between $20USD and $40USD.
My argentine purchased Metabo hammer drill would cost about 50,000 pesos today- which is still a bit cheaper than the US cost. $178 USD at the blue rate.

which brings me to No. 3
Many big corporations that sell things in the argentine market, like Bosch or Metabo or Brother, do not constantly update prices as the blue dollar rate changes.
Earlier this year, I bought a Brother embroidery machine in BA, at the Blue rate, for roughly 1/3 the US cost- because the national brother distributor here set the price a year or so before I bought it, and did not update. So, even if I had paid the black rate, I would have saved big over the exact same machine in the US, because the price had been set so long ago.
A few years ago, this was true for cars- I know someone who bought a car here, at roughly half the US price for the same model, even though the blue rate was not double the peso at that time. The global prices were set at corporate HQ, and not adjusted for US dollar swings.

 

[Quilombo]

There are several different things going on here...

Totally right regarding having dollars (or if your work lets you index to them in pesos, thats what I do with my clients, or you get raises above inflation like some tech workers/truckers), and yes, the multinationals don't always know how to price things here (thankfully for us) so when there are wild swings in the blue/CCL we can take advantage of it.

Don't get me wrong, I'd much rather have a "normal" economy here, but I gotta say, while I'd never buy a Philco TV, I have/have had a couple of their products and I'm happy with them, mind you they're all made in China.

As for my washer/dryer and TV, they're both "Made in Argentina" but the way Samsung phones are "made" here too, the companies just assemble them in TDF with imported parts; Argentina doesn't make LED panels, logic boards, RAM, processors, etc. It's this weird Argentine version of Import Substitution Industrialization that has only worked in TDF making it a rich province despite being the literal end of the world, but that's because the state is just manipulating the market so companies go there; good luck getting an import license to build TVs in CABA for example.

How's the Turkish washer and dryer? Perhaps it's more common in Europe, but I would never really think of an appliance being made in Turkey. I was in Istanbul earlier this year and poked we did some shopping, great prices compared to Argentina on clothes, better quality too, but computers and such seemed to be cheaper at Mediamarkt in Spain.

 

[Ries]

Washers and dryers are actually very different from phones- they are probably 75% Sheet metal, which is often made here, and is completely formed here. And Argentina has a long history of making motors, heating elements, and other mechanical parts. The electronics, its true, are made from asian components, just like every iphone, Viking appliance, or Ford vehicle.
But the majority of argentine "white goods", the trade name for appliances, are actually majority industria argentina.
The Argentines have a pretty substantial manufacturing capacity for motors, transformers, ag equipment, sheet metal products, food processing machinery, hand tools, clothing, shoes, textiles in general, Steel Mills, Auto manufacturing plants, stamping plants for auto parts, furniture, kitchen products like glassware and plates and silverware, eyeglasses, and many more things. In the USA, virtually all domestic production in many of these categories has long since moved to SE Asia.
I buy a fair amount of Industria Argentina, and it is usually better quality and cheaper than imports are in the USA. For instance, I buy all my work clothes here these days except double knee-ed carpenters jeans, and the Pampero and Ombu brands are equivalent to Carhartt, but half the price or less.

the Philco drill is equivalent to chinese drills sold for the same price in the USA. And, as a lifetime tool user, I can tell you, its worth what you paid for it. I probably own 50 hand power tools, and do know just a bit about them. So it was no great bargain, although I am sure its fine for your uses.

The Turks have a 2000 plus year history of metalworking, and their products are quite good.
I actually own some much larger Turkish metalworking machinery ($10,000 USD range) and its quite good- they are currently the world largest producers of many categories of industrial sheet metal working machinery.

Similarly, the Blomberg/Beco appliances I own (4 now, a washer, a dryer, a dishwasher, and a fridge) are all quite well made, reasonably priced, and sell in very large volumes in Europe and North America.
Basically, they are lower priced versions of Bosch and Miele, at 1/2 to 3/4 the price.

 

[Ries]

Interesting video here of one of the biggest argentine appliance manufacturers, (smaller than SIAM, though) and their factory- with cnc milling machines, robots applying glue, cnc sheet metal punches and brakes, and a high local parts content.

 

[FrankPintor]

We expect to be equipping / furnishing a new home in about 6 months or so, so I'm very interested in recommendation for kitchen and other equipment. Negative recommendations are also useful, for example over the 5 years I've been here I've been here I've learned to detest Patrick fridges, BGH air conditioning, and Longvie washing machines.

Miele is a top European brand, anything local and cheaper that's close in quality would be very interesting.

 

[jblaze5779]

I bought Samsung wireless headphones for 100 dollars less than in the states last weekend. Good deal. Also got a dewalt router a year ago cheaper than in the states.