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One Small COVID-19 Victory

12K views 101 replies 29 participants last post by  paulg 
#1 · (Edited)
I should preface what I am about to say with an acknowledgement of gratitude. COVID-19 has harmed or even taken so many lives away that the gravity of lost sales absolutely pales in comparison. Nobody in my immediate family or close circle of friends and loved ones has suffered any permanent loss or injury other than economic (thank God). I live in the world of BMW retailing, highline European import luxury cars are just that (a luxury that only a few privileged can actually afford), and the loss of a few car deals are nothing compared with what other people have suffered through over the past 90 days.

Back in the late 1980s I lived through the "Black Monday" stock market crash. Over the following days/weeks/months it seemed like things would never be the same, but eventually things turned around and got better again. In the early 1990s, we had the Savings & Loan scandal, and Persian Gulf War I. Both of these events hit the car business hard, but we rebounded due to mostly to sheer perseverance and resolve.

On 9/11/2001 the twin WTC towers fell, and later in 2002 the BMW transport ship 'Tricolor' sank, taking with it many "Sold Order" BMWs. I remember having to make the call to few buyers to let them know their new E39s were resting on the bottom of the ocean. It was memorable only because of heartache, dreams dashed, but ultimately vehicle orders replaced.

In the later 2000s we had the Great Recession. Sales screeched to a halt, a trickle at best for a year. Only with the help of low-interest rate loans, "Cars for Clunkers" programs, etc., did any semblance of normalcy resume. By 2011 business began to boom again and continued to grow steadily, well, until now, the present Coronavirus Pandemic Crisis.

Today, May 14th 2020 is going to go down in the anals (sic) of my auto-sales career alongside the aforementioned.

Until yesterday, things were beginning to look up. Factories re-opening, BMW shipping cars to dealers again, and with the announcement of the "Sunset" of BMW European Delivery, I was on a roll. I had made a half-dozen or so fresh deals over the last week, and then today happened.

Now, we all knew that shutting down all of production was going to really screw up our supply. We expected that some orders would get lost (cancelled/deleted), and that it would take a while before things normalized.

I never in my wildest dreams expected to see what happened today...

.
 
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#4 · (Edited)
Imagine printing your "DAR" (Daily Availability Report), the one that shows your entire vehicle supply pipeline....from cars on the ground in-stock, to cars at the VDC, cars on the water, cars awaiting shipment in Bremerhaven (or Greer), cars in production, cars scheduled for production, cars on order, and cars in the factory order bank.

The one that lists VINS, production numbers, customer names, etc. My daily news briefing.

Imagine running this report that had been 12 pages long and finding it to be now just 7 pages long. The majority of cars "on order" (111 & 112 status), are just plain GONE! Poof! Bam!! GONE!!!

This includes all of the last-minute European Delivery M2 & M5 orders you just spent the last week making as well as cars like the active Bimmerfest Forum Member's 230i that had been on order since March. GONE. G-O-N-E gone...

An order I had just filled yesterday on a 2021 X3M. Poof! Gone. Deleted. Buh bye... :wave:

:cry:

I took the afternoon off and am attempting to numb my brain before I have to start making calls and explaining to buyers who have been patiently waiting for their new "Ultimate Driving Machines" for in some cases months.

.
 
#6 · (Edited)
Thanks, I really appreciate it, but honestly, in most of the cases I don't how I am going to be able to solve an apparently unsolvable problem.

That, and now I effectively have little or nothing left at all to sell moving forward until the world's supply of BMW resets itself.

We will get a fresh allocation this week, but I doubt it will come close to replacing what is lost.
 
#8 ·
Hopefully, it's just a computer glitch. BMWUSA.com was acting up for a while. The GM parts website database is whacked now, too. ***8230; or they've run out of parts for 2007 Cobalt's.

Although, I could see production at the end of a platform's run (e.g. M2's) being cancelled altogether, since they have to retool for the next platform, and suppliers are retooling for the next platform, too.

I had to wait 17 months for my E46 M3. Production was delayed, and delayed, and delayed because of problems with the S54.
 
#9 ·
Are the factories solely focused on playing catch-up at this point? Perhaps fulfilling previous orders (what would be the cutoff date?), then supplying China. After which the US and everyone else will be able again to get slots for MY21 vehicles?
 
#11 ·
So perhaps the rumor I saw on another post that claimed a dealership told a customer that their order was cancelled because it was not already in production is true:eek:? Do we have any idea what the cut off date was? My M340i is supposedly SOMEWHERE in the assembly run....but My BMW Garage has not updated my actual status since I think 3/5. Then it just said entering the queue. The Genius and BMWNA phone lines confirm it started production, they just cannot tell where it stopped and what it's new estimated completion date is.

I have heard from several other folks (Mostly GM people) that this is an awful time to be anywhere in the car business.:bawling:
 
#13 ·
Which number are you calling at BMWNA? My M340i was started on 3/12 w/ a scheduled finish date of 3/24. However, the factory closed 3/18 so I know it stopped mid-build. The MyBMW site just had "Production Begins" but is now showing "Exterior Body Assembly Begins". The last rep I talked to at the BMWNA phone number said it is scheduled to be finished 5/26.
 
#14 · (Edited)
Good Luck Jon and all of you impacted. Stay safe, and hopefully this will pass sooner than we anticipate. This of us who drive theses cars must remember how lucky we are. 1968BMW2800 has mentioned several times how fortunate we all are to be worrying about our next BMW. Much tougher for those on the business side. You can't sell what you don't have. Jon I really hope you and your colleagues get through this. Thanks for starting and keeping this community going. I still feel like a newcomer, but really appreciate the wisdom out there
 
#17 · (Edited)
If an order was already in "150 status" it is most likely safe.

For sure, any order that was not in "Priority 1" (SOLD ORDER) by April 30th, your order has been DELETED..

If anyone has a question about their order, CALL YOUR DEALER (not BMWNA).

All BMWNA employees are still working from home and they are overwhelmed.
 
#18 ·
The one possible saving grace is that what out BMW Factory rep (Market Manager) sent in an email this morning, that he has a list of all P1 orders that were deleted, and he will be working with distribution to find replacements where possible.

What does this mean? In some cases, a customer just might get a MY 2021 instead of a 2020. The wait clock will be reset no matter what. And as for the lost European Delivery M Model orders, oy, I just pray BMW gives us extra allocation..

I want to say that none of this is the fault of BMW of North America, but rather an artifact of COVID-19. BMWNA has continued to fight the good fight with every available resource.

Fight on!
 
#21 · (Edited)
I have the personal BMW NA e-mail address for my market manager, as once my status 111 F83 ZCP is cancelled, I will e-mail him and request to have a 1st available priority allocation for a G83 competition for 2021.

Thats awful all of the P1 deleted orders, especially the "sun set" ED orders. Hopefully, BMW NA reconsiders the ED program in light of the P1 ED orders being deleted.

EDIT: My P1 order has been cancelled, e-mailing my market manager now and cc'ing my sales manager. Should be interesting the MM response.
 
#24 ·
In a macro sense, this is not all bad. You're going to see a lot of folks who had ordered expensive models downgrading because of changes in their business. (I may be one of them). Buyers are no longer going to expect you to run a locate over an entire region; a center with a nice build is going to want to hang onto it anyway. You'll find an ass for every seat on the lot, regardless of colors or options. Folks who can't get the EXACT car they wanted will compromise, maybe with a CPO. Which will help use up the inventory at the auctions, in turn propping up the resale value of all BMW's.

What BMWNA / BMWFS should do is institute a leasing program for CPO's. A lot of serial leasers would take a 2 year CPO lease to tide them over till the factory is up and running. In some cases, this will allow them to get an LCI G30, or an M440i. This is a good thing. You're enough of a sales pro that you will be fine. It will weed out some of the dead wood in every center's sales department, but that's okay.

If I was in the business, I'd start getting really, really chummy with my Pre-Owned and Lease Return Managers, so I could get first dibs on the tasty returns. We all have confidence in you, Jon. And we will support you however we can.

The BMWNA empolyees who will really take it in the shorts are the folks at the VPC's and the Performance Center. I feel badly for them when the pipeline runs dry...
 
#25 ·
In a macro sense, this is not all bad.

What BMWNA / BMWFS should do is institute a leasing program for CPO's. A lot of serial leasers would take a 2 year CPO lease to tide them over till the factory is up and running. In some cases, this will allow them to get an LCI G30, or an M440i. This is a good thing...
+++

24 month CPO lease for returning leasees. Lease fee waived (or at least halved from new car lease fee). Reasonable residuals. Extend warranty coverage for entire lease term for, say, 10,000 miles/year beyond original warranty.

2 years later, back we come, sniffing around for some New Car Smell, feeling well-loved by BMWNA.
 
#29 ·
:thumbup:
 
#34 ·
IMHO a CPO lease would benefit everyone. Dealers who don't have a pipeline of new models for the next 4-plus months. Consumers who have leases expiring, would like to stay with the brand, but are worried about the future. BMWFS who now has an alternative market for the cars coming off lease, rather than let them go at Mannheim for thousand$$$ less than their residual. Owners, who won't see the FMV of their current cars devastated by the glut of lease returns. Banks and finance companies, who won't see their collateral deeply underwater.

I would lease a CPO M4 vert or 650i GC in a New York minute. Especially if I didn't have to worry about that V8 grenading itself.
 
#39 ·
I should preface what I am about to say with an acknowledgement of gratitude. take a while before things normalized.

I never in my wildest dreams expected to see what happened today...

.
SARS-CoV-2 has truly changed everything. It is disheartening to see all the lives that have been touched directly or indirectly by this @!%K. I have had to isolate myself from my wife and kids for the last 2 months due to my constant work exposure. Although my new M550 is absolutely one of the best cars I have ever driven, I don't enjoy my rides anymore, I am either missing my family or am nervous about my next shift...Please stay safe and take care of yourself. The orders will get fixed, and factories will start producing... life will get back to being normal. I can't wait to start complaining about number of times I have to wash Azurite black or why there are watermarks on the car with ceramic coating. They all seem so trivial now.
 
#43 ·
I’m in that boat - I was waiting on an ED date confirmation for an M2 (yes I contacted Jon but out of state lease deals are understandably too much brain damage). I’ve been in contact with my guy and he’s confident it’ll work out. I’m also still in touch with my old sales guy, who moved over to the service side for another perspective. While he didn’t have any fresh news, he’ll pass along anything pertinent.
Another thing to think about is how the EU is closed until at least June 15. An American passport holder couldn’t fly there now even if we wanted to.
 
#45 ·
Another thing to think about is how the EU is closed until at least June 15. An American passport holder couldn't fly there now even if we wanted to.
Europe wants to have summer tourism this year, as it's an giant unknown. Which EU country's are going to require a mandatory 14 day quarantine?

Realistically, the earliest ED for US customers will be July 2020, as 4 months (March through June), will have to be rescheduled between July through September. Just like BMW NA cancelled P1 status 111 and 112 orders, I foresee ED pick-ups being cancelled due to the limited availability at the Welt due to social distancing.
 
#46 ·
Very true Ibiza - I wonder if the bulk of those ED slated deliveries from the last few months weren’t sent to their respective destinations anyway for local delivery? I was told that they don’t like to hold cars in Germany for more than a couple weeks after they’re built.
Maybe Jon or someone who (unfortunately) went through the cancellation of an ED once the borders shut down can comment.
 
#47 · (Edited)
Very true Ibiza - I wonder if the bulk of those ED slated deliveries from the last few months weren't sent to their respective destinations anyway for local delivery? I was told that they don't like to hold cars in Germany for more than a couple weeks after they're built.
Maybe Jon or someone who (unfortunately) went through the cancellation of an ED once the borders shut down can comment.
I posted on another thread that my car was one of those that got stuck mid-production when the factory had temporarily closed. My original ED was supposed to be 4/21. Another gentleman who was scheduled for the same week chose to switch to stateside delivery. I'm staying the course, for now, and am currently rescheduled for 7/7. Will the EU borders be reopened to US passport holders by then? That's the wild card. If not and there is a reasonable amount of certainty of making this happen at the end of July, I would be open to that as well. However, at that point we'd be looking at if they would be willing to hold a car in Germany that was completed at the end of May and also if my flights will still be as favorable. Delta already cancelled my outbound 3pm flight on an A350 and we're now on a 6pm on a 777-200. Still have the Delta One Suites :) .
 
#53 ·
What was a your build? The pricing shouldn't increase that much from MY20 to MY21, as usually there are additional standard options included to justify the price increase. The order guides should be released shortly- after the dust settles from the MY2020 order purge.
 
#59 ·
Jon, any word on if although ED orders for MY20 vehicles were cancelled, dealers were still able to place ED orders for MY21 vehicles to be picked up by September?
 
#89 · (Edited)
Hey Shon, here is the latest update.

1) If BMW was not going to let anyone do a model year 2020 European Delivery, then why didn't they just say so up front? Seems like a no-brainer, doesn't it?

2) I had three solid ED orders with production numbers, now yes, the latest, customer can do a model year 2021. However, BMW is *not* replacing the deleted/obliterated/vaporized production numbers that we lost. We have to wait, hope, pray for a large miracle, that in the next month or so, a gift from God delivers a M2 and a couple of M5 allocations to my dealership. The likelihood of that happening? I would estimate p = .05. BMW of Santa Maria is a small dealership in rural Central Cal. Without divine intervention, I am afraid my ED customers will be S.O.L...

3) And it's not even just my Euro Delivery orders that I lost. I lost a 230i Cp, a M340xi sedan, a X3 M40i, and a MY 2021 X3M. Mum has been the word from BMWNA. A full week has passed and I don't have ANYTHING to give to my customers information-wise, so I am feeling pretty hopeless that BMW is going to help. At all...

Before D-Day" (D as in "Delete Day") we were told in a dealer bulletin that we would receive assistance, that everything that could be possibly done in the spirit of maintaining customer satisfaction would be done. This has not been my experience at all. I did manage to re-fill a Bimmerfest Members X3 M40i order with an alternate production number, but I feel like I am totally on my own here trying to do the very best for my customers that I possibly can...

:(
 
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