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F10 / F11 (2011 - Current)
The new chapter in the highly successful story of the BMW 5 Series Sedan (F10) and wagon (F11)

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  #1  
Old 09-23-2012, 08:12 AM
kssod kssod is offline
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Why is the 5 so expensive

I keep coming back to the 5 as a replacement for my aging RL. Yet even a small smattering of options, puts a 535xi in the 65k to 70k plus range. That's the same as a new S6. While I have a new found respect for BMW, after attending their performance driving school, their option packages are excessive.
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  #2  
Old 09-23-2012, 08:22 AM
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I agree, however, the market has responded and they sell them around invoice, sometimes prior to negotiating, which is more reasonable.
  #3  
Old 09-23-2012, 08:34 AM
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Products are priced in two ways. First, it has to make a profit, or will lead to a profit, otherwise it does not pay to produce. Next, it is priced to the market. If the market is willing to pay the price for the product, the product is well priced.

You can get a car with the basic attributes of a 5er for half the price, similar size, carrying capacity, etc.

Same with jeans. You can spend anywhere from $10 to a couple of hundred dollars for jeans.

So why does BMW charge so much for the 5? Because they can.
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  #4  
Old 09-23-2012, 08:46 AM
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Quote:
Originally Posted by Kamdog View Post
Products are priced in two ways. First, it has to make a profit, or will lead to a profit, otherwise it does not pay to produce. Next, it is priced to the market. If the market is willing to pay the price for the product, the product is well priced.

You can get a car with the basic attributes of a 5er for half the price, similar size, carrying capacity, etc.

Same with jeans. You can spend anywhere from $10 to a couple of hundred dollars for jeans.

So why does BMW charge so much for the 5? Because they can.
O.K. Well said.
  #5  
Old 09-23-2012, 09:13 AM
Raddius Raddius is offline
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Quote:
Originally Posted by kssod View Post
I keep coming back to the 5 as a replacement for my aging RL. Yet even a small smattering of options, puts a 535xi in the 65k to 70k plus range. That's the same as a new S6. While I have a new found respect for BMW, after attending their performance driving school, their option packages are excessive.
One strat is to buy packages when you want enough of the included options to realize a savings. If not, cherry-pick the options you want and add them separately. BMW is very good about ordering exactly what you want if they're unable to find it.

Also, know the invoice price of the car/options when you go in to the dealer (cars.com will let you config the car and see invoice and MSRP pricing). You can work a pretty amazing deal off sticker.
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  #6  
Old 09-23-2012, 09:27 AM
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there were some great deals on leftover 2012 as long as you like black interior, and no sport options. Now, the 2013 are basically a grand off sticker. There are no content discounts yet like on the 12, ($2500), or conquest etc. Small market, cleveland area will need to wait.
  #7  
Old 09-23-2012, 09:38 AM
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Fortunately, I am on the opposite side of the spectrum. I prefer a car solely for its driving dynamics. Yes, I will pay for the handling and performance packages, but not the convenience and premium packages.
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  #8  
Old 09-23-2012, 10:21 AM
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Quote:
Originally Posted by kssod View Post
I keep coming back to the 5 as a replacement for my aging RL. Yet even a small smattering of options, puts a 535xi in the 65k to 70k plus range. That's the same as a new S6. While I have a new found respect for BMW, after attending their performance driving school, their option packages are excessive.
Expensive compare to what? the RL?? They are in two difference class of cars. I would say a $70K 535xi is almost loaded and not a small smattering of options. One can get a 2012 535xi now for about $10K off, thats $60K or so for a loaded 535xi, not a bad deal compare to the $80000 S6 which has no discount.
  #9  
Old 09-23-2012, 11:01 AM
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You are not getting the same thing compared to. Honda.

If you take the time to look past the paint you will see why.

If you still don't know why stick with a Honda.
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  #10  
Old 09-23-2012, 11:12 AM
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Quote:
Originally Posted by Kamdog View Post
Products are priced in two ways. First, it has to make a profit, or will lead to a profit, otherwise it does not pay to produce. Next, it is priced to the market. If the market is willing to pay the price for the product, the product is well priced.

You can get a car with the basic attributes of a 5er for half the price, similar size, carrying capacity, etc.

Same with jeans. You can spend anywhere from $10 to a couple of hundred dollars for jeans.

So why does BMW charge so much for the 5? Because they can.
Not quite the point. The F10 is also expensive compared to A6 and E class as well, direct competitors.
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  #11  
Old 09-23-2012, 11:15 AM
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Originally Posted by Needsdecaf View Post
Not quite the point. The F10 is also expensive compared to A6 and E class as well, direct competitors.
That is exactly the point.

The market, thus far, is allowing it. If 5s were sitting on lots and not getting ordered while A6s and Es were walking out the door, BMW would adjust to the market.
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  #12  
Old 09-23-2012, 12:02 PM
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If anyones on crack its audi the s6 loaded is like 87k I can load up a 550x for about 83800 (not including negotiation).
  #13  
Old 09-23-2012, 12:08 PM
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It's expensive because it can be. BMW has the cachet and prestige to command such prices and they have no problem selling them. Of course, no one is actually paying MSRP on BMWs. It makes it look like you're getting a fantastic deal when the dealer chops off $10k.

But I do think that BMW needs to lower prices because the whole "chopping thousands off sticker" is getting old and annoying. It kills future resale for those who finance, like me. Audi and Lexus don't resort to $10k off sticker deals to move inventory. Try asking the Lexus or Audi dealer for $10k off a Q7 or RX. They would tell you to get out. The BMW dealer would probably sell the X5 to you for close that amount

Last edited by AutoUnion; 09-23-2012 at 12:18 PM.
  #14  
Old 09-23-2012, 12:16 PM
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Quote:
Originally Posted by AutoUnion View Post
It's expensive because it can be. BMW has the cachet and prestige to command such prices and they have no problem selling them. Of course, no one is actually paying MSRP on BMWs. It makes it look like you're getting a fantastic deal when the dealer chops off $10k.
my grandma does she picks a color and they drop it at her house, she strokes a check.
  #15  
Old 09-23-2012, 12:19 PM
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Originally Posted by SuperTerp View Post
my grandma does she picks a color and they drop it at her house, she strokes a check.
Man, I feel sorry for her then. It's pure profit for the dealer. Even at thousands below invoice on a F10, dealers make profit
  #16  
Old 09-27-2012, 04:22 PM
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Man, I feel sorry for her then. It's pure profit for the dealer. Even at thousands below invoice on a F10, dealers make profit
Why feel sorry? She knows what she want and is willing to pay for it. What right have you to fell sorry for her?
  #17  
Old 09-23-2012, 03:45 PM
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Originally Posted by AutoUnion View Post
It kills future resale for those who finance, like me. Audi and Lexus don't resort to $10k off sticker deals to move inventory.
Dude, what are you talking about?? Lexus and Audi will both take 10k off sticker or more! It just depends on the model.

See attached for:

13k off a new 2013 Audi A8

5k-10k+ off 2012 Lexus models
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  #18  
Old 09-23-2012, 12:56 PM
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Let's be frank - the 5 series is a rip-off for what you get.

The only reason they get away with charging these ridiculous prices are:
- Many people will rather have a car with few options but a BMW badge rather than a loaded Audi or Lexus (snob buyers)
- Some people are so obsessed with BMWs historical reputation for handling that they won't even cross shop competition (drone buyers)
- Some people are completely uncompromising and buy what they consider the best at any price (Mugs)

I know these labels are condescending, but in the spirit of brutal honesty I would admit I fall into one of them.

A sensible person would buy an Audi A6 or a Lexus GS350 instead of a 535i. But we aren't making a sensible choice here. We are making an emotional one. Which is why I drive an M5.
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  #19  
Old 09-23-2012, 12:56 PM
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Let's be frank - the 5 series is a rip-off for what you get.

The only reason they get away with charging these ridiculous prices are:
- Many people will rather have a car with few options but a BMW badge rather than a loaded Audi or Lexus (snob buyers)
- Some people are so obsessed with BMWs historical reputation for handling that they won't even cross shop competition (drone buyers)
- Some people are completely uncompromising and buy what they consider the best at any price (Mugs)

I know these labels are condescending, but in the spirit of brutal honesty I would admit I fall into one of them.

A sensible person would buy an Audi A6 or a Lexus GS350 instead of a 535i. But we aren't making a sensible choice here. We are making an emotional one. Which is why I drive an M5.
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  #20  
Old 09-23-2012, 08:20 PM
kc1953 kc1953 is offline
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Quote:
Originally Posted by Stealth.Pilot View Post
Let's be frank - the 5 series is a rip-off for what you get.

The only reason they get away with charging these ridiculous prices are:
- Many people will rather have a car with few options but a BMW badge rather than a loaded Audi or Lexus (snob buyers)
- Some people are so obsessed with BMWs historical reputation for handling that they won't even cross shop competition (drone buyers)
- Some people are completely uncompromising and buy what they consider the best at any price (Mugs)

I know these labels are condescending, but in the spirit of brutal honesty I would admit I fall into one of them.

A sensible person would buy an Audi A6 or a Lexus GS350 instead of a 535i. But we aren't making a sensible choice here. We are making an emotional one. Which is why I drive an M5.
I dunno Stealth. I could have had an Audi or a Lexus or a Mercedes, or anything else with a price up to 70k (a self imposed limit). But I chose the f10 535i because I preferred the way it drove, the interior quality and the looks. Was it an emotional purchase? Well, I felt happy after I bought it, and happiness is an emotion, so I guess so. Was it an uncompromising purchase? Hardly. Almost every decision in life involves some kind of compromise, including car purchases. A snob purchase. Well, maybe a little.

But I do agree with you Stealth. Those labels are condescending.
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  #21  
Old 09-23-2012, 08:49 PM
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I think as others have said, their needs to be a clear distinction between luxury marques.

Tier 1) rolls, bentleys, maybachs etc

Tier 2) Audi, BMW, Mercedes, Lexus, Porsche

Tier 3) Acura and Infinti

This brand distinction isnt particularly clear since if you look it at, platform sharing between the luxury marques (ie VAG) and between marques and their parent group (ie Bmw and Rolls), but this is the best you can figure.

Now if you look at Tier 2 mfgs, like Audi, Lexus, and Porsche, your stuck at sticker, or maybe a 1% off sticker, they dont negotiate mostly, unless its model end or something like conquest cash comes about. Bmws and Mercedes the negotiating headroom is much better. Bmws and mercedes can be had for 500-1000 above invoice, which is about 6k off of sticker. These two dont get stuck at msrp, since they are two companies that dont offer economical alternatives. Example VAG: If you want a family SUV/SAV your choices are: Economical VW Tourag, Luxury: Audi Q7 Performance: Porsche Cayenne. Hence, why negotiate, they offer the same vehicle platform, in different flavors from different marques.

Now when it comes to BMW, they only offer one marque, and they can do the same, but with different option sets (Base 528i, 535i, 550i) hence you get your three choices, all from the same brand, and diff price points. So in my opinion, BMW 5s arent really priced high or expensive, they offer what they can in the Luxury domain, and that too at an affordable invoice price, which is far less than what the others can do.

Now if you compare different tiers, theirs going to be an obvious stick shock/outrage. My thing is yes, BMW do offer less, then say Acura and Infinti offer, but you have to see where each manufacturer is coming from. If you look at my sig it explains a bit, but if you look at Acura, their cost to build a RL is going to be far less than a 5, since they share basic architecture from the Honda vehicles they are based on.

Sorry for the long, convoluted read folks!
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  #22  
Old 09-24-2012, 08:18 AM
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Quote:
Originally Posted by NoI4plz View Post
I think as others have said, their needs to be a clear distinction between luxury marques.

Tier 1) rolls, bentleys, maybachs etc

Tier 2) Audi, BMW, Mercedes, Lexus, Porsche

Tier 3) Acura and Infinti
I think I would put Lexus in the Tier 3 as well.

Porsche has to be differentiated as well. There are Porsches (911 and Panamera) which enter the Tier 1 level, while the Cayenne's, Gayman's, and Boxter's tickle the Tier 2 level.
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  #23  
Old 09-24-2012, 11:00 AM
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Originally Posted by At Law View Post
I think I would put Lexus in the Tier 3 as well.

Porsche has to be differentiated as well. There are Porsches (911 and Panamera) which enter the Tier 1 level, while the Cayenne's, Gayman's, and Boxter's tickle the Tier 2 level.
If Lexus is tier 3, then Acura is tier 4 and Porsche should be tier 1.5. Pretty soon, we will have 7 or 8 tier

Last edited by The X Men; 09-24-2012 at 11:01 AM.
  #24  
Old 09-25-2012, 03:31 PM
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Quote:
Originally Posted by NoI4plz View Post
I think as others have said, their needs to be a clear distinction between luxury marques.

Tier 1) rolls, bentleys, maybachs etc

Tier 2) Audi, BMW, Mercedes, Lexus, Porsche

Tier 3) Acura and Infinti
I agree with this for the most part, but this is the way I look at it

Elite: Rolls, Bentley, Maybach, porsche, etc
Tier 1: Audi, BMW, MB, Lexus
Tier 2: Cadillac, Jaguar
Tier 3: Acura, Infiniti

Porsche, Rolls, Bentley, etc are held to a higher standard and are in the "elite" class. The Porsche badge carries much more weight than a BMW/Audi/Lexus, etc. Porsche's average selling price is above MB/Lexus/Audi/BMW

Tier 1 requires the prestige, brand recognition, a full lineup (entry level to D class sedans), and a Halo car. BMW doesn't have a "halo," but they clearly have the prestige to stay up there. MB has had the SLR, SLS, etc. Audi has the R8. Lexus has the LFA.

Jag is not up there because they don't have a full lineup. Same with Cadillac. Cadillac will be back at Tier 1 in a couple years once GM revamps their whole lineup.

Acura and Infiniti are worthless and are nothing but Nissan + and Honda + models.
  #25  
Old 09-25-2012, 04:39 PM
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Originally Posted by AutoUnion View Post
I agree with this for the most part, but this is the way I look at it

Elite: Rolls, Bentley, Maybach, porsche, etc
Tier 1: Audi, BMW, MB, Lexus
Tier 2: Cadillac, Jaguar
Tier 3: Acura, Infiniti

Porsche, Rolls, Bentley, etc are held to a higher standard and are in the "elite" class. The Porsche badge carries much more weight than a BMW/Audi/Lexus, etc. Porsche's average selling price is above MB/Lexus/Audi/BMW

Tier 1 requires the prestige, brand recognition, a full lineup (entry level to D class sedans), and a Halo car. BMW doesn't have a "halo," but they clearly have the prestige to stay up there. MB has had the SLR, SLS, etc. Audi has the R8. Lexus has the LFA.

Jag is not up there because they don't have a full lineup. Same with Cadillac. Cadillac will be back at Tier 1 in a couple years once GM revamps their whole lineup.

Acura and Infiniti are worthless and are nothing but Nissan + and Honda + models.
Have to disagree with the Cadillac ranking : Evidence

3.6 litre motor used throughout the GM Lineup
Cadillac SRX- Rebadged Chevrolet Equinox, GMC Terrain
Cadillac XTS- Rebadged Buick Lacrosse
Cadillac Escalade- Rebadged Chevrolet Tahoe, GMC Denali
So until Cadillac changes this they are just a Tier 3 IMO, In fact my wife's M37 is way above any current Cadillac.
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