Has BMW stuffed the US channel?

[mogrefy]

Originally Posted by cmhsam

I dont see BMWFS doing this in the near term. They are basically taking the risk and shifting it onto the customer with the lower residual. They are hedging their bets on the fact that the value of the m5 will not hold after 36 months. They know worst case they will get their 49% and then a few extra points when they turn around and the dealer sells the vehicle.

Fully agree with your assessment about them shifting risk to the customer with the 48-49% residual approach thus far.

However, if the pipeline is filling up then one way to move the vehicles without significantly discouting purchase price is to bump up the residuals. It's pretty well known the BMWFS provides "support" for some models above what they will actually be worth after x years, often leading to BMW being considered a more advantageous lease when compared to others (say Audi for example). BMWFS can write off the "loss" on the residual and they've moved inventory without dealers offering large discounts on the vehicles.

Of course that's just one of many options... I'll be leasing, so I can hope right?!

[smashhell]

Another thing I might add is that I don't really see them advertising the car.
You see the new 3 series ads everywhere but I never seen a M5 ads.
Pretty much the only place you can see the M5 are magazines and their website.

[RingMeister01]

This occurrence isn't isolated to the M5. 3 German luxury marques are experiencing this overload of inventory. Europe's economy is basically sinking deeper and deeper into the recession and as a result automakers are left with a surplus of inventory. As a solution the bosses decided to ship these cars to the U.S. for any chance of being sold. To satisfy shareholders these cars shipped to the U.S. are marked as sold, although they just sit on dealer lots. Though we are suffering economic hardship, Europe is f'in terrible.

[uhn2000]

Originally Posted by RingMeister01

This occurrence isn't isolated to the M5. 3 German luxury marques are experiencing this overload of inventory. Europe's economy is basically sinking deeper and deeper into the recession and as a result automakers are left with a surplus of inventory. As a solution the bosses decided to ship these cars to the U.S. for any chance of being sold. To satisfy shareholders these cars shipped to the U.S. are marked as sold, although they just sit on dealer lots. Though we are suffering economic hardship, Europe is f'in terrible.

Good points, just read today that Spain has even fallin deeper into a hole. Did not think this was possible!

[dkreidel]

Originally Posted by ucla95

I know of one dealer that's advertising $5000 off their in-stock M5's. I too am surprised at the lack of interest in the car.
My guesses:
1) Performance SUVs just continually becoming more popular than sedans in general, and especially at this price point.

I am waiting for the '14 M6 with a manual trans, but bought a '13 X5M in the year-end hoopla to amuse me until the M6 is available next summer. I never thought I'd own an SUV but this pig really flys with 555HP, x-drive and launch control! Once it is Dinan'd I'd like to run it against an M5 to see how much the pork slows it down.

I came across Angeles Crest Hwy late last night and the truck actually handles pretty good in full-on M mode

[hinckley]

Originally Posted by RingMeister01

This occurrence isn't isolated to the M5. 3 German luxury marques are experiencing this overload of inventory. Europe's economy is basically sinking deeper and deeper into the recession and as a result automakers are left with a surplus of inventory. As a solution the bosses decided to ship these cars to the U.S. for any chance of being sold. To satisfy shareholders these cars shipped to the U.S. are marked as sold, although they just sit on dealer lots. Though we are suffering economic hardship, Europe is f'in terrible.

This is a very good point. There were stories that BMW was diverting production from European to US cars. I wonder whether BMW is subsidizing these discounts to help dealers move inventory.

[RingMeister01]

Originally Posted by hinckley

This is a very good point. There were stories that BMW was diverting production from European to US cars. I wonder whether BMW is subsidizing these discounts to help dealers move inventory.

Good question.

[hinckley]

I don't like to raise too high a profile on this issue or to talk publicly about money, but I'm blown away by the smokin' deals that are available on M5s right now. If you're thinking about it, there appears to be a lot of incentive to move inventory before the end of the month.

[URBAN LEGEND]

Originally Posted by cmhsam

At $100K you have a lot of options.

bingo!


The price is super high for a 5 series. Hood is even the same.

[brainblade]

I just picked up my new 2013 m5 and it was a great decision. The dealer had three in stock and i had been scratching my head for months. Should i wait for the lci...????dont wait. Jermey clarkson once said about the e60" I dont care what you got, this is better , faster than anything else." Thats what i think of the f10 m5. Its so good in every way--there will always be something better and bmw will always add something but dont wait. I cant imagine big changes.

[ColdList]

Originally Posted by Patsc23

Give us free M school again with purchase

That is actually a pretty good marketing idea. It would likely nudge the true driving enthusiasts to BMW when comparing against less "performance marketed" sedans such as a Mercedes. BMW has always done well creating that positioning in the mind of the consumer. This would be a very good way of re-establishing "authority" in the marketplace. Lol! I am information marketer by profession. You got my brain ticking. "Authority" is a very strong natural "influencer" that we all have built into our brains. Can't fight influencers even when you know you are being sold. :-)