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      10-09-2008, 06:01 PM   #1
Palbay
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New BMW Sales Strategy

This just popped up in my home email. From Bimmer/File. Looks like Uncle Bimmers "Pull" sales plan ain't workin out so well.None of this is good for BMW.Truly in a Worldwide Financial meltdown.Apparently the 40,000 or so car allocation that was going FROM the US TO Russia,China,India,etc.... might find its way back to the US.In this economy there is a fine line as to how much someone will pay for a luxury item.Might be a good time to grab a Bimmer! Thanks! PalBay
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BMW Re-thinking Sales Plan

Posted: 09 Oct 2008 01:39 PM CDT

As you all know by now BMW made the decision a few months ago to change its strategy. They opted to use the “pull” mentality in much the way MINI operates and has been successful, a car is sought by a purchaser rather than pushed by the dealer. This is to keep supply and demand in check and not allow for a huge inventory or surplus of cars.

Indications from inside Woodcliff Lakes is that there is another change coming. All indications are that the pull plan is going out the window because the economic downturn has gone global and is not just a US issue. BMW had cut US allocations to send them elsewhere, the problem is that elsewhere is getting hit harder with this downturn than the US. The economy in Russia has lost about half of its value in the past few months, a key emerging market for BMW that is no longer going to have the anticipated demand. That is not to mention the issues in Europe and the remainder of Asia.

As we reported yesterday, BMW will be cutting overall production at the Leipzig plant. This was not part of the original plan of just moving allocations, by eliminating cars this signifies something far worse. The other major issue is that customers are not making large scale purchases, like cars, in fear of our economy worsening. This is not helped by the “pull” mentality and the fact leases are not being subsidized as much as in the past. While the industry as a whole is suffering BMW is seeing former customers looking elsewhere for a lower payment as even with the Owner Loyalty rates BMW is not even in the same ballpark payment wise as other marquees.

In a nutshell BMW has indicated that they will announce “a new aggressive sales and marketing plan by tomorrow”. Making Friday announcements is a technique BMW has been using to spur commenting on blogs and forums over the weekend to get some easy free marketing; mainstream media will cover it as well but over the weekend word of mouth picks up a bit.

We suspect that leases may become a bit more reasonable but more so that financing will become even better for longer periods of time. This would make buying the car via financing have similar payments as a lease. There may be new “pull ahead” programs to get existing lease customers into newer cars sooner with special money factors. While these ideas are pure speculation, something is coming tomorrow and it should move cars.

From our conversations with salespeople in the industry this is welcomed news, as they are getting minimal traffic these days and financially hurting badly.

We should have more details by tomorrow afternoon so stay tuned.
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      10-09-2008, 06:22 PM   #2
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If BMW wants to sell cars he is what I would do.

Extend maintenance and warranty on all models for 8 year 100k models standard.

People would then be ok financing for 5-8 years as the warranty and maintenance is covered.

I think the basic 4yr/50k warranty sucks.

I think the 6yr/100k warranty sucks because they know the aeverage person drives 12k miles per year. So the warranty effectively becomes 6yr/72k. Nothing more than a marketing gimmick as the tranny will fail at 80-120k.
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      10-10-2008, 08:00 AM   #3
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I agree on the maintenance/warranty issue, though people NEEDING more than 60 months to pay off a car (even then that's a decent amount of time) just indicates to me there's no scenario in which they can financially swing that car and still be saving money.

A lot of people are scared of owning a bmw (ok, I don't know if that's true but I sure am) post-warranty due to the high cost of parts a labor, even for the littlest thing gone wrong and an extended-warranty coupled with more free maintenance might go a long way to alleviating that and convince more people to buy rather than lease.

can you imagine an e46 m3 still under warranty? i'd be all over it.
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      10-10-2008, 10:57 AM   #4
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Palbay,

any updates??
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      10-10-2008, 11:09 AM   #5
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very intrested on the turnout OP
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      10-10-2008, 11:10 AM   #6
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hmm,always somekind of game.
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      10-10-2008, 11:20 AM   #7
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Quote:
Originally Posted by phatr1s View Post
Palbay,

any updates??
From BimmerFile.Only applies to 2008 models.Thanks! PalBay
Attached Images
File Type: pdf BMW 2008 Lease Rates.pdf (131.6 KB, 133 views)
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      10-10-2008, 11:41 AM   #8
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I called a dealership near my house about a 2008 335i sedan the guy refused to budge from 47K - I told him good luck and hung up the phone. Hopefully whatever they are planning will work because I would love to get my hands on one.
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      10-10-2008, 02:08 PM   #9
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Quote:
Originally Posted by Palbay View Post
From BimmerFile.Only applies to 2008 models.Thanks! PalBay
I wish them luck.
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      10-10-2008, 11:51 PM   #10
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wow everything dropped again the coupe m3 isnt 1.9 anymore but now .9 ahhah YESSSSSSSSSSSS
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      10-11-2008, 10:29 AM   #11
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Quote:
Originally Posted by thedean786 View Post
I called a dealership near my house about a 2008 335i sedan the guy refused to budge from 47K - I told him good luck and hung up the phone. Hopefully whatever they are planning will work because I would love to get my hands on one.
what was the MSRP?
Unfortunately, the margins/markup does not increase with a bad economy. If the economy was good, do you think the margin would only be 1%?
I know they need to get rid of the car, but of course there is only so much they can move, of course there is only so much you have in your pocket.
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      10-11-2008, 12:58 PM   #12
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Quote:
Originally Posted by thedean786 View Post
I called a dealership near my house about a 2008 335i sedan the guy refused to budge from 47K - I told him good luck and hung up the phone. Hopefully whatever they are planning will work because I would love to get my hands on one.
its one of the last handful of '08's left in the country. Why would they give it away?
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      10-11-2008, 08:37 PM   #13
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so... what's the new plan?
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      10-12-2008, 08:26 PM   #14
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Quote:
Originally Posted by AutoCouture View Post
its one of the last handful of '08's left in the country. Why would they give it away?
I don't know where you live, but dealers in S. california have diamond dozen E90 335. I would call and hang up too, and try another dealer.
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