Why is my speedo set so high?

Why do manufacturers set speedos to 260 km/h for non-performance cars used in city or even country driving? It squashes the range for 0-80 km/h on the gauge and detracts from readability. In this respect at least, VW has got it right.

It's silly when the car won't even get close to those ultra-high speeds, but I would guess it comes down to giving the illusion that it could. Like you I would rather have a speedo that is more relevant to the car I'm driving.

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