[nyalpine90]

RIP BMW clients

[Sedan_Clan]

Originally Posted by Stevens21234

One thing I appreciated from C63s is there were less of them on the road. Anyone and their mother can rent a F80 for ~$900 or even less for a stripper. With that much saturation of supply, it hurts the BMW buyers.

That depends on where you live. AMG's are just as common as M cars here in California, and the dime-a-dozen low range BMW's, Mercedes and Audi's are everywhere.

[Herofmine]

First was free maintenance program cut now this... meh bmw will lose a lot of sales i am 100% sure!

[R3dliner]

Originally Posted by Sedan_Clan

That depends on where you live. AMG's are just as common a M cars here in California, and the dime-a-dozen low range BMW's, Mercedes and Audi's are everywhere.

+1 M's and AMG's are a regular. Even exotics are a regular around here.

[The Automotive Enthusiast]

Originally Posted by ASAP

fwiw bmw leases are way too cheap and this is one of the downfalls of a company... bmw chased sales numbers and allowed almost anyone to get into any car

comprable audi and mb models were far more $$$ to lease... i see this is as a good thing and may help the brand image a bit

*use to be.

[phefner]

Originally Posted by RichP

Another +1 on this. In some ways BMWFS is operating like a Ponzi scheme with the inflated residuals, low money factors, incentives etc. Look at how how inexpensively you can lease a basic 3 series. This was never sustainable. (I just gave back my i3 on 2 year lease.. buyout was 33K, market value was about 18!)

And as it was said in the quote.. this is will force BMW to have more compelling product offering rather than relying on name and enticing leases to move product. And if they don't right the ship sooner than later.. then that money is going to be found by less R+D and lower vehicle quality in pursuit of cost-saves.

+2 for the long term vision.

[JRobUSC]

Originally Posted by The J-Man

I am not willing to pay more for a BMW than a competitor.

Fair enough.

Originally Posted by The J-Man

I'm not even willing to pay the same for a BMW as a competitor.

Aaaaaand don't let the door hit you. The problem here is, in their quest to for sales volume, BMW spoiled its customers. And now you have owners like this guy who for decades were given benefits hand over fist they weren't getting from any other competitor (free maintenance, crazy lease residuals, etc.) who feel like they're entitled in perpetuity. BMW "owes them", like they did BMW a favor taking advantage of all those one of a kind benefits all those years, and now if BMW brings some of those back down to earth a little bit (like their competitors have been this whole time) they're going to leave the brand because "BMW isn't showing them loyalty" and buy from some other brand THAT NEVER DID A GOD DAMN THING FOR THEM. Who is actually being disloyal in that circumstance? The brand who spent decades doing for you what no one else would? Or the client who threatens to jump ship if they have to pay the same for a BMW as a competitor? Loyalty isn't a one way street, you have to give it to get it.

If you want to get a different brand, go for it. Those Benz's and Porsches don't come with any free maintenance. Ever looked at lease payments on an Audi or Porsche? Have fun. Personally I hope BMW takes this as an opportunity to purge their owner base of mooches and detritus so they can focus less on winning imaginary volume crowns and more on building the best, most desirable cars. Build the best, and people will pay for it, and you won't have to buy business with massive incentives and completely unsustainable lease residuals.

[ah3nyc]

Originally Posted by Mo@BMWofFairfax

*use to be.

I think the increase in residuals and MF will drive lease prices up 10-15%. Giving BMW no advantage anymore. How bmw will increase profit per car by selling less? Means they have to price cars higher. Bmw diluted the brand with so many models and is now trying to scramble to find way to drive profit margins higher.

I agree they shouldn't have never done incentive leases or msd to begin with. However I think they should have given repeat customers an incentive to stick around. Many here in this board don't get that not all bmw drivers are bound to the brand regardless of what they do. If leases creep up a person who gets that basic 320 for 300 a month and now it will cost way $350-400. Why would they pay more? When other brands can offer a better monthly payment.

The run of the mill 3 and 5 series that drive much of the sales for BMW costing more will hurt bmw. They generate most of the profit to make enthusiasts cars such as m3,m4 etc.

I spoke to my dealer and he thinks it's not a good idea what bmw is doing lately and will end up hurting the brand. Just my 2 cents. Now I'm ready to be attached again

[The Automotive Enthusiast]

Originally Posted by JRobUSC

Fair enough.



Aaaaaand don't let the door hit you. The problem here is, in their quest to for sales volume, BMW spoiled its customers. And now you have owners like this guy who for decades were given benefits hand over fist they weren't getting from any other competitor (free maintenance, crazy lease residuals, etc.) who feel like they're entitled in perpetuity. BMW "owes them", like they did BMW a favor taking advantage of all those one of a kind benefits all those years, and now if BMW brings some of those back down to earth a little bit (like their competitors have been this whole time) they're going to leave the brand because "BMW isn't showing them loyalty" and buy from some other brand THAT NEVER DID A GOD DAMN THING FOR THEM. Who is actually being disloyal in that circumstance? The brand who spent decades doing for you what no one else would? Or the client who threatens to jump ship if they have to pay the same for a BMW as a competitor? Loyalty isn't a one way street, you have to give it to get it.

If you want to get a different brand, go for it. Those Benz's and Porsches don't come with any free maintenance. Ever looked at lease payments on an Audi or Porsche? Have fun. Personally I hope BMW takes this as an opportunity to purge their owner base of mooches and detritus so they can focus less on winning imaginary volume crowns and more on building the best, most desirable cars. Build the best, and people will pay for it, and you won't have to buy business with massive incentives and completely unsustainable lease residuals.

I have a feeling many will look elsewhere. Keeping a customer in the brand is a lot more cost effective than trying to sway new ones. Not sure where BMW is going with this move, honestly.

[The Automotive Enthusiast]

Originally Posted by MilehighM3

I guess inflation has no effect on pricing? You have to face the fact that things change. It's still the best included maintenance plan.

Erm....No, it's not.

[doug_999]

Originally Posted by Mo@BMWofFairfax

I have a feeling many will look elsewhere. Keeping a customer in the brand is a lot more cost effective than trying to sway new ones. Not sure where BMW is going with this move, honestly.

I'm not sure I agree. When those "customers" are actually costing you money, is it really more cost effective to keep them?

Originally Posted by Mo@BMWofFairfax

Erm....No, it's not.

From what I can tell, only Jaguar has a better program.

[ASAP]

If you want to be a highly regarded brand... here are some tips-

1) don't offer extremely cheap leases to get people in your cars at all costs
2) sway people to buy your cars instead and keep them, raising resale value in the used market
3) don't make 1 million versions of the same god damn car

BMW has somehow violated all of these rules and maybe someone finally said, perhaps we shouldn't be chasing the sales crown and instead build solid, higher priced cars that people will want to buy no matter what... from a biz perspective perhaps this won't make sense, but from a brand value perspective, it makes a ton... do you want to know why Honda still has the best resale value of any Japanese car and is still regarded as the best all around brand in Asia? They offer no rebates, no special deals and have 0 fleet vehicles... it works and works well. The salesman above is just a bit salty that he wont' be able to smooch people into any car on the lot and move as much volume as he could before since the deals are now less attractive... this makes it better for the people that actually care about the cars.

[adc]

Originally Posted by ASAP

If you want to be a highly regarded brand... here are some tips-

1) don't offer extremely cheap leases to get people in your cars at all costs
2) sway people to buy your cars instead and keep them, raising resale value in the used market
3) don't make 1 million versions of the same god damn car

BMW has somehow violated all of these rules and maybe someone finally said, perhaps we shouldn't be chasing the sales crown and instead build solid, higher priced cars that people will want to buy no matter what... from a biz perspective perhaps this won't make sense, but from a brand value perspective, it makes a ton... do you want to know why Honda still has the best resale value of any Japanese car and is still regarded as the best all around brand in Asia? They offer no rebates, no special deals and have 0 fleet vehicles... it works and works well. The salesman above is just a bit salty that he wont' be able to smooch people into any car on the lot and move as much volume as he could before since the deals are now less attractive... this makes it better for the people that actually care about the cars.

You guys talk as if BMW had already turned around their product around, into the best driving cars. They haven't, it's the same product as yesterday, but they will find fewer customers for it.

How is it a brilliant strategy to do this before your product reigns supreme?

[M5Rlz]

Originally Posted by Herofmine

First was free maintenance program cut now this... meh bmw will lose a lot of sales i am 100% sure!

Good lol, Maybe they won't have cars that buyers like us who get F10 M5s and get the F80 instantly have cars worth 40% less within 8-12 months of buying because everyone with a 580 credit score, some cash for MSDs and offsetting maintenance can buy the car lol.

BMWs current depreciation trends are sickening when you contrast it to all but the top top AMGs.

Originally Posted by adc

You guys talk as if BMW had already turned around their product around, into the best driving cars. They haven't, it's the same product as yesterday, but they will find fewer customers for it.

How is it a brilliant strategy to do this before your product reigns supreme?

Its funny how flat the designs have gotten I remember when I first got into this game, everyone hated on Chris Bangle, but now that we are removed likely from all his ideas, you see how plain Jane the cars are. One thing you could never say about his designs they were far from plain. May not have fit everyones tastes but he kept things interesting.

This was one reason I opted not to fulfill being picked to buy the M4 GTS, and one reason I chose the F80 over the i8. People don't seem to equate collectors or special with segments of the BMW market, and I was not in a position to get left holding the bag [like you see with the glut of i8s now] if they started making 10000 M4 GTS' a year later lol.

[Sedan_Clan]

Originally Posted by Mo@BMWofFairfax

I have a feeling many will look elsewhere. Keeping a customer in the brand is a lot more cost effective than trying to sway new ones. Not sure where BMW is going with this move, honestly.

The resident BMW detractor is at it again. People have been claiming they were going to leave BMW for over a decade. The sales continue to increase (...be it from returning customers or new customers), so the reality doesn't quite align with your narrative.

[Fugly M3]

Originally Posted by Sedan_Clan

The resident BMW detractor is at it again. People have been claiming they were going to leave BMW for over a decade. The sales continue to increase (...be it from returning customers or new customers), so the reality doesn't quite align with your narrative.

I actually did leave the brand...alas, I am back!

[bradleyland]

Originally Posted by doug_999

I'm not sure I agree. When those "customers" are actually costing you money, is it really more cost effective to keep them?

Based on BMW financials, they make a profit of $5k per car, so they're far from NET negative profit. When it comes to customer acquisition costs, Mo is absolutely right. Your least expensive customer acquisition is always repeat business.

[335togo]

So quick q... based on this new change is it best then to get into lease before May1? Never leased before but thinking about it...thx

[bradleyland]

Originally Posted by 335togo

So quick q... based on this new change is it best then to get into lease before May1? Never leased before but thinking about it...thx

That depends upon whether you intend to take advantage of the MSD rate buy-down?

There are a lot of people freaking out in here, but we're talking about a relatively small amount of money. IMO, a lot of folks are hung up on the principle of the matter. Something is being taken away from them, and that pisses them off.

Any time you're buying a new car, you should understand the math involved in the financing method. If you understand how lease math works, then you can easily see what the exact amount saved by MSD would be. You can go to a dealer right now and run a deal with and without MSD.

MSD is attractive because it's basically a sure bet, and it pays something like a 10% APR when you calculate the savings on your principle "invested" (your total security deposits). You can't get 10% on any other "guaranteed" investment, so most people who are responsible with their money jump at this opportunity. I see where it makes financial sense, but in the overall scope of things, the principle invested is pretty damn small.

We own our home, and in August of this year, we'll have no more car payments. My retirement fund is on-target, and I have no debt (outside of the 1 remaining car loan).

I have never used MSD.

Why? Because my money is usually invested elsewhere, and while the rate of return is competitive with my other investments, the opportunity cost of moving the money around outweighs the marginal benefit (difference in return between the current investment vs MSD rate of return).

If you have the money lying around, then sure, take advantage of MSD, but I wouldn't go out and buy a car simply because this program is going away. I would be far more concerned about the changes in residual that are hitting the BMW line-up. Learn the math, the rest will follow.

[Fugly M3]

Originally Posted by 335togo

So quick q... based on this new change is it best then to get into lease before May1? Never leased before but thinking about it...thx

OP, to be honest my guess is you probably wouldn't have used the MSD. Most people who lease do so because they want a good payment with little out of pocket. The MSD technique requires you to throw down 8 payments worth up front in exchange for a somewhat reduced payment amount. Now, you may well have planned to do that, but very few people do. As bradleyland said, residuals and rates are far more important.

Originally Posted by bradleyland

IMO, a lot of folks are hung up on the principle of the matter. Something is being taken away from them, and that pisses them off.

THIS!!!! When I found out my maintenance plan was being hacked on my 2017 I was sooo freaked out and upset (and that's a bigger deal than the MSDs I think), but then I just bit my lip and carried on.

[NickyC]

Looks to me like BMW is just trying to get ahead of what a lot think are coming, a huge downturn in the automotive industry within the next two years. Everything is primed, and the conditions are right. They've blown the auto bubble just like home loans and student loans, it's a disaster everywhere you look (except for that 20.5k stock market baby BTFD!).

For people who like to pay cash for 2-3 year old used vehicles, I think 18-24 months from now is going to be incredible.

[Maynard]

I think that those arguing to leave BMW (over anything) are misguided in the long run. Better to heavily increase the volume of your complaints AS A CURRENT OWNER. Especially for the performance and styling issues, where 'we' are clearly in the minority. It works for every other group of marginal (check out the history of the 'moral majority' for what a letter writing campaign can do to boost your influence, or any of these recent politically correct advertising boycotts). If we all leave and buy Porsche, then BMW will continue to cater to people wanting a high-market Corolla and the brand will really die.

I think (hope) they will rapidly come to their senses and return to more distinctive models, with some carving out the performance niche - right now that is languishing, and even with fewer sales, it remains viable as a higher-margin option. Once all the enthusiasts start going to second hand cars that will start to really erode. Right now I'd probably pay an extra $5k for hydraulic steering assist with decent feel (they could just crib from their old models, how hard can it be). Recent developments in BMWCCA also fortell a desire for versions stripped of all the nannies (or fully defeatable). If they only make 5k per car now, this can be huge - lots of folks on this forum have spent more than that to add good wheels or exhaust/tune, so the potential to double profits should be meaningful, even on a small scale.