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View Full Version : BMW Price increases as of June 1


mapezzul
05-06-2008, 07:37 AM
There are some serious price increases coming as of June.

http://www.bimmerfile.com/2008/05/06/price-increases-as-of-june-1/

cha777
05-06-2008, 08:34 AM
My understanding from the disclaimer at the bottom is that already ordered vehicles with a production number are exempt from the price increase...how does this work with ED?
Example: I have a production number and confirmed pick-up in Munich. My paperwork will be done the first week of July, last day of June if lease program terms tank. Pick-up will be July 18th at the Welt. Redelivery sometime in August/September. Does the September 1, 2008 deadline stated in the bulletin mean Welt delivery or stateside delivery...I hope Welt as I will already making lease payments!! Thanks.

Also...should this thread be switched/duplicated to the "Ask A Dealer" Forum??

djfitter
05-06-2008, 09:13 AM
My understanding from the disclaimer at the bottom is that already ordered vehicles with a production number are exempt from the price increase...how does this work with ED?
Example: I have a production number and confirmed pick-up in Munich. My paperwork will be done the first week of July, last day of June if lease program terms tank. Pick-up will be July 18th at the Welt. Redelivery sometime in August/September. Does the September 1, 2008 deadline stated in the bulletin mean Welt delivery or stateside delivery...I hope Welt as I will already making lease payments!! Thanks.

Also...should this thread be switched/duplicated to the "Ask A Dealer" Forum??
Dude, think about it. You already made the deal. You already agreed on a price. How can they then raise it? :dunno:

dj

cha777
05-06-2008, 09:18 AM
Dude, think about it. You already made the deal. You already agreed on a price. How can they then raise it? :dunno:

dj

Dude...it's an ED...a little different. I've signed a PO and agreed to a "price over invoice." Have paid no deposit, have not signed anything on it with a definite price, and the time I will be signing stuff with numbers on it, the new pricing will be in effect.

AzNMpower32
05-06-2008, 09:30 AM
Read the bottom of the pricing bulletin. Any orders with a confirmed production number by 1 June 2008 will not be affected. Any dealer wholesale orders completed by 1 June are also not affected (but this doesn't apply to anyone here, really). The bulletin suggests that dealers should designate a vehicle in the system as "sold" with a customer name by COB 9 May 2008.

I would have liked to see a bigger increase for AT. I think BMW should charge $2000 for AT. Europe pays ***8364;2100 for it.

psr
05-06-2008, 11:09 AM
Pretty amazing that BMW chooses to increase prices in the USA in the midst of a recession. Indeed, when you look at the competition, BMW's lease pricing is on the very high side. One example -- while you can lease a Infiniti M35AWD "very well equipped" for about $500/month with little down, BMW is charging well over $600/month for the 335ix coupe only somewhat well equipped (i.e., premium package). And the MSRPs on the 2 vehicles (admittedly very different vehicles) are comparable.

I think as the year progresses, even BMW (and MB and Audi) will be forced to discount, or else they'll have to redirect even more vehicles outside the USA. Unless, of course, consumers allow themselves to become mesmerized by these vehicles and are willing to significantly overpay for them. I don't begrudge anyone for choosing to overpay -- but we'd all be better off if we didn't.

psr

Pinecone
05-06-2008, 11:24 AM
1) There is no recession. GNP rose during the last quarter.

2) BMW is a Euro based company, so as teh dollar declines in value against the Euro, the prices will go up in dollars to reflect this. And BMW has held the line pretty well considering the Euro went from $1.15 to $1.60.

psr
05-06-2008, 11:41 AM
You can try and justify it because of exchange rates et al, but the FACT is that BMW's lease rates are noncompetitve based on MSRPs. Consumers don't (and shouldn't) care about BMW's exchange rate exposure -- which I'm sure is hedged in any event. And if you don't think the economy sucks for 95% or more of the population (whether or not technically a recession) then you're really deluding yourself.

Don't be fooled . . . if the economy continues to tank, discounts well in excess of the increases will rule . . . there's nothing more painful than aging inventory!

psr

Fulltone74
05-06-2008, 11:58 AM
You can try and justify it because of exchange rates et al, but the FACT is that BMW's lease rates are noncompetitve based on MSRPs. Consumers don't (and shouldn't) care about BMW's exchange rate exposure -- which I'm sure is hedged in any event. And if you don't think the economy sucks for 95% or more of the population (whether or not technically a recession) then you're really deluding yourself.

psr

Exactly. Any multinational business does currency hedging in order to "lock-in" a net price and therefore net profit.

milobloom242
05-06-2008, 12:08 PM
Toyota's also raising prices http://www.leftlanenews.com/toyota-announces-mid-year-price-increases.html

Evlengr
05-06-2008, 01:14 PM
Well that makes sense. Sales are suffering due to oil prices so lets raise our prices to offset them.

psr
05-06-2008, 02:02 PM
BMW's not stupid -- they know that everyone's going to be looking for a discount, so they raise prices to give the salesforce a chance to make it appear that they're passing on a "great deal"! Our reaction -- you gotta be kidding!

Don't be fooled. . . . aging inventory is a bitter pill!

PSR

S93D
05-06-2008, 02:28 PM
And if you don't think the economy sucks for 95% or more of the population (whether or not technically a recession) then you're really deluding yourself.


Recession is an economic term. I think it is two quarters of decline in GDP.

You can be in bad shape or have high inflation but that's not always a recession.

I don't envy car companies. They have to charge enough to make money. Even determining the MSRP is not easy. Too high and it looks bad in magazine comparisons. Too low and dealers with high expenses don't like it because they really look like the bad guys selling for more than MSRP. Demand changes within the year and in different regions so the MSRP has to be set to the highese demand but not too high. And how do you meet changing demand with a fixed output factory. You can try to build more models in the same factory and restart or stop a shift.

Of course, that's what the car people are paid to do, figure it out.

SFC B
05-06-2008, 03:31 PM
<blockquote>if the economy continues to tank, discounts well in excess of the increases will rule</blockquote>I don't think that it will be the economy which will dictate what happens to the auto market. Unless someone bought an over-priced house with a $0 down, ARM they're probably not any worse off than were before the housing bubble burst. The steep discounts will be in vehicles which don't get good mileage. If dealers and manufacturers want to move their gas guzzling vehicles in a $3.50 a gallon world they'll need to make them cheap enough to offset the savings owners of more fuel economic vehicles.

valeram
05-06-2008, 09:22 PM
Read the bottom of the pricing bulletin. Any orders with a confirmed production number by 1 June 2008 will not be affected. Any dealer wholesale orders completed by 1 June are also not affected (but this doesn't apply to anyone here, really). The bulletin suggests that dealers should designate a vehicle in the system as "sold" with a customer name by COB 9 May 2008.

I would have liked to see a bigger increase for AT. I think BMW should charge $2000 for AT. Europe pays ***8364;2100 for it.

Price protection is a little bit confusing. The price increase is effective on June 1 but in order to get the price protection, the dealer should designate the vehicle as SOLD (with Prod #) to their system by COB May 9. So if I ordered one after May 9 but before June 1, they cannot guarantee that they can freeze the price. Fortunately, I got my Prod# and I got a screen print of their ordering system that stated my name and indicated that it is SOLD.

Pinecone
05-07-2008, 07:02 AM
Yes, BMW did hedge currency, but they have been running through that hedge for several years.

And you said that were in a recession, which we are not. I never said the economy was in great shape, but we aren't in a recession.

And I agree, unless you are in a stupid home loan, things aren't that bad.

bmrgrl
05-07-2008, 03:45 PM
I can't open the pricing bulletin.... will this affect the 1 series? There's no mention of it on the post...

dan74
05-08-2008, 07:56 AM
I can't open the pricing bulletin.... will this affect the 1 series? There's no mention of it on the post...

Not the base model price. But the options are going up.

adrian's bmw
05-08-2008, 09:43 AM
Dude...it's an ED...a little different. I've signed a PO and agreed to a "price over invoice." Have paid no deposit, have not signed anything on it with a definite price, and the time I will be signing stuff with numbers on it, the new pricing will be in effect.

You're price protected, so you have nothing to worry about. :thumbup:

cha777
05-08-2008, 01:49 PM
You're price protected, so you have nothing to worry about. :thumbup:

Thanks for watching my back Adrian! :roundel:

KPblM
05-12-2008, 07:08 PM
I don't think it matters one bit whether we're in a recession or not. Two quarters of negative growth or none, even at 0.6% growth you might as well say our economy is not doing good at all. Now that the credit crisis is easing, another crising is looming- consumer defaults are going up in every way.
Commodity prices shooting up, dollar falling, etc. Yes, BMW did a currency hedge for sure (I word at a bank and deal with these) like any other multinational company with huge currency exposure. In my opinion, they'll direct more cars to other parts of the world where demand is growing and receivables are not in USD. In US it is falling. Hence the lower projected residuals and the much higher lease rates to make up for the loss. And I have to say that even though BMW is sooooo much better than other competitors, the ever increasing price differential between it and Benz/ Audi is beginning to look like it is not worth it. The bread and butter of BMW- the 3 series, is becoming ever more expensive and now easily tops 40k even half equipped. Once it tops 45k BMW will have to introduce something to take the 30-40k price range like the 3 did even 5 years ago. Yes, I know that the 1 Series is supposed to do this, but looking at the styling and power, it seems to me that the 1 has a looooooong way to go to live up to the 3, even from the late 90s.

Yes, prices will continue to go up, but as the inventory will pile up, either BMW will begin to discount (gasp!) or will simply shift more focus to other parts of the world, at the expense of customer loyalty. And if Benz is smart, they'll take this opportunity to perhaps catch up to the 3 series.

Anyone agree with any of these points?

gregthomp
05-12-2008, 07:42 PM
Once it tops 45k BMW will have to introduce something to take the 30-40k price range like the 3 did even 5 years ago. Yes, I know that the 1 Series is supposed to do this, but looking at the styling and power, it seems to me that the 1 has a looooooong way to go to live up to the 3, even from the late 90s.


Well, in POWER the 1 is at least equal to the 3, since the engines are the same. And being lighter, it's faster. Styling, yes, is not as good.

I think BMW is doing the smart thing to bump prices in the U.S. and divert some volume elsewhere in the world, where they can make a better profit. And personally I won't mind seeing fewer 3s on the road, especially in my color, Sparkling Graphite. I see twenty of them a day.

BMW also has the hot MINI division, which will no doubt continue to thrive in the U.S. as gas prices soar.

psr
05-13-2008, 08:34 AM
KBLM:

Couldn't have said it better -- the lease prices are outrageous on some models, particularly on the 3 series coupe and the 528xi. I just gave up on leasing a 335xi coupe because they wanted $630/month + multiple security deposits + fees/taxes up front, and that was before the price increase several weeks ago. Forget about it! Looking at a GS 350AWD for far less -- more luxury, less fun, but I just can't justify the hosing from BMW.

I won't be suprised if US leases on the 3 series coupe shrivel in the next few months unless the dealers start discounting. Indeed, I think that they raised the rates so that in 30-60 days the delaers can start discounting again and make it appear they're giving a bit on the price.

Can't get caught up in the BMW mystique unless you're willing to really pay for it!

PSR

mistercindy
05-13-2008, 08:55 AM
My dealer said they'd be around 2 - 3% of MSRP. At least at Classic BMW of Plano the deadline for ordering a car at the old prices was last Friday, May 9th. The BMWUSA web page "Build Your Own" section still shows the same prices.