Quote:
Originally Posted by signes
What does BMW get out of this agreement - payments from Brembo? I don't understand why they would ever enter in to an agreement like this. Also, paying a company not to compete can run into trouble in a hurry.
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No, they don't have any extortion payments from what I understand.
They just agree to allow a OE vendor NOT to produce a brake kit for a particular car even thought they may be contractually obligated to do so.
That's where the private agreements come into play. Brembo may request an out on a specific BMW OE application, becuase their own internal numbers suggest that more money can potentially be made in the aftermarket on certain models. BMW grants the request, and simply hires another OE manufacturer on their list. This is one of the reasons why automotive manufacturers have more than one OE supplier under contract at all times.
It's a cost/benefit analysis thing for OE suppliers.
Brembo gets what they want, and BMW has a little leverage in the next OE contract negotiations.
There is absolutely nothing illegal about this whatsoever. The two separate companies simply take care of one another.
That's how big business operates in the real world.