April 9, 2017, 1:07 pm
I appreciate your opinion and thoughts.
There will always be a dynamic tension between the manufacturer, the franchise, and the customer. And this is the nature of for-profit businesses. It has always existed, and has an ebb and flow that benefits one over the other depending on circumstances.
And that dynamic always includes competition, pricing, value, reputation ... all that.
Many if not most of us in the business are decidedly not kool-aid drinkers. We're realists, we're people seeing our numbers go down (units and $$) as volume AND profit drops.
We're salespeople ... we could sell trucks and Subarus (no disrespect to either) but we stay with BMW. 11th year for me. Jon, Greg, Adrian ... probably longer. So I guess yes, our "kool-aid" is a genuine belief that there is more value to BMWs than other comparative brands.
I don't think that BMWs have taken a significant step backwards, enough to warrant defection (I know a strong word) just due to the pricing and financing changes.
How do I know that? I see the comparison performance data, I attend ride and drive events with competitive cars; I know the core DNA remains by and large unchanged.
And I know every time I take a client on our "slot car track" test drive and see their reaction.
I think we lost a portion of our base, to use the political term, with the advent of the electronic control systems. But that had to be weighed against the consumers that came to the brand that previously thought BMWs were too stiff and heavy-steering.
We will likely lose some of the base accustomed to lower leases. With all due respect, I still think that "buyer friendly" in the current context equals payments which equals MF, residual, and incentives.
The future is likely to not be utopia for either of us. As BMW continues to increase the base cost of the vehicles and lower the MSRP to Invoice margin, and have our holdback be tied to harder measures, our margins will not all of the sudden "sky-rocket." And we will lose some loyal customers who feel that there isn't enough driving differentiation with competitors to warrant a higher payment.
But it seems this is a course correction for BMW and BMWFS that we all, customer and dealers, hope is a tack that works out.
I'm not about to head off to the "AudiFest" forum any time soon.
Originally Posted by mwm1166
And here is where I come back and always ask.
What do we, the customer, care about "better for the dealers"? That seems to be a you guys concern, but general what's better for the dealerships is worse for us the end customer. What you see as being the "payment brand." We looked as the "buyer friendly brand." Sure some of that means the same thing. However, if the pricing model becomes more opaque and more equal to all the competition as the cars take a step back towards the competition it just means that "we" the "customer" will look to see if we can't do better for "ourselves" the people who make the payments and use the equipment, elsewhere. Sure it doesn't mean you definitely will lose or won't compete. But it changes a lot of us from "automatically going to re-lease" to "sure they are a great option but I'll check out what's on offer since they are all the same."
I know your dealerships can't always see that, and I'm sure you just all see that the brand is built and hallowed. However, millions of brands have been and then slowly destroyed from cashing in, or changing their core character. I'm not saying it will happen, but it could.
All you dealership guys seem to think that it's impossible that BMW could fall behind with their own customer base, and that you have nothing to lose.
You may be right, this might all work out perfectly, and all dealers and CA's margins will go sky-high and the amount of customers lost will be more than made up for in new roundel badge whores looking to show off a luxury item. You could be right! But there is always a chance this is Faustian Bargain...
And every time you guys poo-poo the possibility just makes me think you're drinking the kool-aid...