European Delivery questions...

[smalldog]

MBR129, and whoever else knows,

Can you provide some specifics about how you "saved money" by getting European Delivery? Exactly how much are the cards discounted? Does it vary from car to car? Is it a specific percentage or doallr amount taken off whatever final price you negotiate with the dealer?

Does it apply the same whether you purchase or lease?

Also, why is it discounted? If BMW still has to ship the car to USA for ultimate pickup at your dealer after you drive it around in Germany, where's the cost savings?

After you drop the car off in Germany for shipping, how long until you pick it up at dealer? What are you supposed to do for a car in the meantime? Will dealer provide loaner?

[mbr129]

First, check the BMW website. Then go to the European delivery forum and run a search. Also, check out this link. Gary did a great job.

http://www.runlevel6.com/bmw/EDsavings.html

If you have any more questions, I'll be happy to answer them. Good luck.

[hockeynut]

Is it true that BMW pays less tax because they are importing a USED car into the US as opposed to a NEW car?

SteveH

[mbr129]

Originally posted by hockeynut
Is it true that BMW pays less tax because they are importing a USED car into the US as opposed to a NEW car?

SteveH

I am pretty sure that is the explanation.

[Tanning machine]

Originally posted by hockeynut
Is it true that BMW pays less tax because they are importing a USED car into the US as opposed to a NEW car?

SteveH

No. Any tax savings are minimal. Duty is 2.5% on cars, so there's no way tax could account for a $3000+ difference.

The difference comes because the dealer does not get a back-end payment (called "holdback" by other cos.) based on customer satistfaction and dealer sales. Their entire profit comes from the difference between what you pay and the ED invoice price.

[EZ]

Eurobuyers at www.eurobuyers.com list msrp and dealer costs for all BMW models eurodelivery or not.

[dkotanto]

Originally posted by rumatt
I don't get this. Why does flying my butt over to Munich mean that the dealer doesn't deserve some money based on my satisfaction level? Also, if the dealer gets less profit on an ED deal, shouldn't dealers be charging more for ED cars then?

I know the ED cars don't come out of the dealer's allocation which helps negotiating, but that's a different factor. It doesn't explain the 7% discount (or whatever it is) off MSRP.

Matt

Dealers profit from the ED sale itself. So if the ED dealer invoice is $40,000 and you negotiate a price of $41,500 the dealer makes $1,500 from you. They just don't get the extras that they would normally get from BMW, because ED does not count against sales quota, customer satisfaction kick backs, etc. They make their $1500 (in the hypothetical sale above) and it's "free" money. You will also save money because "hypothetically" you could paid say $46,000 if you had bought the vehicle not using ED.

[Marco]

I don't remember where, but I read that the discount for ED is a left-over from the old days when European companies, like BMW, were trying to enter the American Market -- a way to attract customers.
To check if true it would be interesting to know when the ED program began.
Anybody?
m.

[waiter]

Mercedes stopped giving a discount and Audi does not offer EU Delivery.

There has to be some governmental reason. If a car on BMW EU Program stays in Europe for over 180 days the 7% is owed. I read that in one of the EU Documents.

[Marco]

Volvo has the program and the discount.
For a fee ($$$) you can pick up the car at a place different from the original delivery point (I forget the name of the city).
m.

[Tanning machine]

Originally posted by rumatt
I don't get this. Why does flying my butt over to Munich mean that the dealer doesn't deserve some money based on my satisfaction level? Also, if the dealer gets less profit on an ED deal, shouldn't dealers be charging more for ED cars then?

I know the ED cars don't come out of the dealer's allocation which helps negotiating, but that's a different factor. It doesn't explain the 7% discount (or whatever it is) off MSRP.

Matt

Don't ask me, ask BMW AG. Basically, they've cut BMW NA out of the middle, which is where the payment/holdback comes from, allocated based on CSI. BMW probably has marketing reasons for doing ED, and tells BMW NA that's how it's going to work.

It does explain why some dealers don't want to go to the hassle, since they don't stand to gain as large a profit. Of course, they're not recognizing that it's "free" money. When they sell one of their allocated cars, they've got to get a certain level of profit, because they have only allocation*profit/car = total profits each month. ED sales are just gravy.

[jrubens]

Perhaps ED is offered to build brand loyalty? If you do ED and have a great experience, isn't it more likely that you would do so again and again, probably moving up the BMW food chain from 3 to 5 to 7?

[Tanning machine]

Originally posted by rumatt

Also, the dealer kickbacks must be less than the 7% MSRP ED savings, which means that both the dealer and BMW are making less money on people who do ED. This raises the original question: why offer ED? It can't because they're just being nice...

According to Jon Shafer (or at least what I read him to say) the holdback is approximately equal to the ED savings, if the dealer gets the top rating. (In other words, the full savings represent the theoretical amount BMW would pay for a top CSI score). The person who loses out is BMW NA or the dealer, but the dealer doesn't really lose, since it's not out of its allocation.

As for why BMW offers this:

Customer loyalty. People who do ED are probably more likely to return to BMW because they get the "whole" BMW experience, including Germany. Also, it may work as a bit of a loyalty discount. My guess is that more "enthusiasts" do ED than the average customer. Why do BMWCCA members get a $500 discount (or more)? Same reason -- it's not like it benefits BMW that much to have its buyers as members, but they want to reward loyalty in some way.

[loubct]

Does everyone go through the process of obtaining an International Drivers Permit. I will be picking up car at Delivery Center and promptly dropping off at Harms.

What has everyone else done in the past?

[Marco]

With an American driver's license you don't need an international permit. That goes at least for Germany, Austria, France, G.B., Italy.
m.

[Tanning machine]

Originally posted by loubct
Does everyone go through the process of obtaining an International Drivers Permit. I will be picking up car at Delivery Center and promptly dropping off at Harms.

What has everyone else done in the past?

The permit is basically a translation of a US drivers license. It may be helpful if you encounter polezei who don't sprechen english. Since it's $10 (or something) at AAA, why not pick one up? Well, maybe since you're only driving across town it's not worth it.

[dkotanto]

Originally posted by Marco
With an American driver's license you don't need an international permit. That goes at least for Germany, Austria, France, G.B., Italy.
m.

Austria requires an International DL.

Jim

[Marco]

UHOh...!
Are you sure Jim?
I drove through it several times without giving it a thought! (I don't remember if I was ever stopped by the police, though)
Was I just lucky?
m.

[M.Wong]

Austria Consular Info page (http://travel.state.gov/austria.html)

Glad you didn't find out the hard way!

"A U.S. driver's license alone is not sufficient to drive in Austria. The U.S. driver's license must be accompanied by an international driver's permit (obtainable in the U.S. from American Automobile Association and the American Automobile Touring Alliance) or by an official translation of the U.S. driver's license, which can be obtained at one of the Austrian automobile clubs (OAMTC or ARBO). This arrangement is only acceptable for the first six months of driving in Austria, after which all drivers must obtain an Austrian license."

[shabbaman]

<b>
!

"A U.S. driver's license alone is not sufficient to drive in Austria. The U.S. driver's license must be accompanied by an international driver's permit (obtainable in the U.S. from American Automobile Association and the American Automobile Touring Alliance) or by an official translation of the U.S. driver's license, which can be obtained at one of the Austrian automobile clubs (OAMTC or ARBO). This arrangement is only acceptable for the first six months of driving in Austria, after which all drivers must obtain an Austrian license."
</b>


Whoops!!:yikes: :yikes:

Looks like I got lucky.

[M.Wong]

We actually went the long way on one leg of our trip because we figured we didn't want to risk it. Should have just got that AAA document before we left!

[shabbaman]

Man, that 540 looks like he's the boss in that picture.

[M.Wong]

It's a great car... my wife's daily driver.

I take the E38 every day and love it. The E30 is the resting car.

[shabbaman]

M Wong, how many miles do you have on your 540? I got 3000 already on my 530.

The best part about buying it as opposed to leasing is that I don't give a $hit about how much mileage I put on it. I just love driving it.

I just had the car and key stuff done today. Hopefully they got it right.

[M.Wong]

About 5,000. The first 1800 were in Germany.

[Tanning machine]

Originally posted by rumatt
The troubling part here is that it takes the merit-based pay away from the dealer for ED deals. If they do a great job they should get a reward. Or if they screw me around, they should lose the reward.

Does this mean that some (crappy) dealers might care less about customer satisfaction when the deal is ED?
. . .
Matt

I agree. It's a bit odd that a BMW dealer has no incentive to please the ED customer. I'm not sure I'd put my $1000 or more on the table to give him that incentive, though, which is what BMW would have to do (i.e., raise the invoice in order to create a holdback for incentives).

[Marco]

Originally posted by shabbaman
<b>
!

"A U.S. driver's license alone is not sufficient to drive in Austria. The U.S. driver's license must be accompanied by an international driver's permit (obtainable in the U.S. from American Automobile Association and the American Automobile Touring Alliance) or by an official translation of the U.S. driver's license, which can be obtained at one of the Austrian automobile clubs (OAMTC or ARBO). This arrangement is only acceptable for the first six months of driving in Austria, after which all drivers must obtain an Austrian license."
</b>


Whoops!!:yikes: :yikes:

Looks like I got lucky.

Me too.

[M.Wong]

Sorry, we seem to have a couple different thoughts going here on this message thread. Just to share, I had a very wonderful ED purchase experience from my local dealer. Even if they didn’t have a lot of incentive to go that extra mile, I must say I was most impressed.

I had been a service customer of theirs for many years (the E30) and they tried to find my E38 when I was in the market, but they were not able to find me the right car. When it was ED purchase time, I checked prices all along the West Coast. Then I called my local dealer and asked them to come close to the best price I could find. They didn’t have to meet or beat it, as I would have incurred some additional expense if I had to travel to pick up the car in California or somewhere at re-delivery time. I just asked them to come close, and they actually met the best price I found.

I thought the savings was due to the car being exported as used (differnt taxes/tarrifs) as well as no marketing/promotional fees, and the dealership allocation issue. All I know is we saved more than it cost for the two week vacation (during an off season time, I admit) and all the gas to take us 1800 miles...

[seivwrig]

I personally believe that ED programs in general have a lot to do with tourism among other things. There are some cost savings to BMW AG but by and large, it is a novel idea. Take a vacation, drive your own car (in Europe of all places), take plenty of pictures and come home. If you love our cars alot, you can visit the factory and or museum. Occasionally, I get mail from Volvo and SAAB with driving schools that correspond with pick-ups at various times of the year. The discount is just a perk. If one has to think about why they should do ED, they should go to local BMW center and pay whatever price they are charged.
If you are going to go on vacation in Europe and you have no plans on trading in your present car, then ED might be for you.