- #106 of 134
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Re: [juice1220]
by skrontz
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Sep 06, 2008 (5:27 pm)
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Replying to: juice1220 (Sep 06, 2008 11:07 am)
Profits are made by either selling something exclusive at high margin or through sales volume. The reason Mercedes and BMW are not making good profits is that their cars are no longer as competitive as Lexus and other similar brands are. It's no secret that the MSRP for a new Mercedes in Europe is way higher than in the States. The reason is that the most of the sales are made here, and raising the price too much would scare away the buyers and drive the volume down. You can't be very profitable on a non-mass-produced high-line vehicle (see Bentley for a perfect example). You have to drive sales volume, and -- hence -- you need to stay competivie in terms of pricing. The MSRPs on 2009 BMW or Mercedes models didn't increase. Actually, the S550 is now cheaper since several former options are now standard (Premium Package I and Wood/Leather Steering Wheel). The inflation itself means that they are 5% cheaper than a year ago. I don't care for the dealers since there will always be competition. If you expect that people would line up to cash out $100k for a rapidly depreciating asset during a severe and prolonged economy downturn, you're in for a huge disappointment. The dealers in "bulletproof" area that I live in right now haven't sold a single 2008 S550 at least for the past 4 months. I expect to buy an S550 slightly above the invoice (and even then, barely anyone would buy it). After all, the most margin is made on warranty repairs, not the initial sale.
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- #107 of 134
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by juice1220
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Sep 08, 2008 (7:32 am)
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I am not sure of Mercedes MSRP's but BMW did go up. I dont know what "bulletproof" area you live in, but my local Mercedes dealer is selling s550 like Pez candies. The reason some of those options have become standard is because the longer a manufacturer produces the same product the cheaper and cheaper it gets to produce the vehicle, so they can give the consumer some standard options. For BMW the US. is not the number 1 market, but Europe is, so they fill production for Europe and then we get the rest. Like I said before we can argue about this for ages, but lets give it a year, and talk again.
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- #108 of 134
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Re: [juice1220]
by skrontz
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Sep 10, 2008 (7:16 pm)
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Replying to: juice1220 (Sep 08, 2008 7:32 am)
OK, let's take a specific example. Back in 2006, I bought my dad a 750Li. The MSRP was slighly over $93k. I just built the same model on bmwusa.com and it came out to slightly over $90k. Bake in the inflation, it went down a lot. Which MSRP are you referring to? I'd like to see specific figures. I live in California. The only area S550s are selling well is probably NYC. Not to worry, soon enough those investment bankers will be trading them in to help the balance sheet Come on, do you really think it costs Mercedes $90k to build a new S550? It's not about transfering the savings to the customer, it's about staying afloat when a Lexus offers twice as many toys at a fraction of the price. As far as BMW selling in Europe, here's a quote for you (you can Google it for the source):
"The USA remained the largest single market for BMW and MINI cars in 2007. With a sales volume of 335,840 units (2006: 313,603 units /+7.1%), the BMW Group sold more vehicles there than ever before."
We can argue for ages, but somehow I'm the one who keeps getting the facts right
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- #109 of 134
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Re: [skrontz]
by shawn757
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Sep 10, 2008 (7:52 pm)
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Replying to: skrontz (Sep 10, 2008 7:16 pm)
BMW's number one market is the US. Not europe. Audi's number one market is Europe. You can see their lease rates are not good compared to BMW. I was told by a BMW dealer that Audi A6 sells more in Germany and in europe than the BMW 5 series.
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- #110 of 134
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Re: [skrontz]
by juice1220
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Sep 12, 2008 (5:14 am)
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Replying to: skrontz (Sep 10, 2008 7:16 pm)
Please read link.
http://www.bmwblog.com/2008/08/05/bmw-to-increases-prices-cut-production-and-red- uce-the-number-of-leases/
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- #111 of 134
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Re: [juice1220]
by skrontz
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Sep 13, 2008 (9:50 pm)
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Replying to: juice1220 (Sep 12, 2008 5:14 am)
So what? Didn't find anything on the supposed MSRP increases you mentioned. I can post any rumors I want in my blog, too. One needs to look at the facts, not rumors.
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- #112 of 134
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Re: [skrontz]
by juice1220
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Sep 15, 2008 (9:02 am)
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Replying to: skrontz (Sep 13, 2008 9:50 pm)
These are not rumors in a blog. Being in the car business, we sometimes have info that maybe the general public doesn't have. Just maybe for once you can listen instead of trying to be right all the time. I dont know what you do for a living and dont know the ins and outs of your business, but I am glad you know everything that pertains to mine. I just hope you dont work for Lehman Brothers, but if you did, it would explain alot. At least one of us does. You are right, I am just a dummy manager in the car business, and really know nothing about what I do. I hope all your car buying needs in the future are wonderful, and may you get all your cars from now on at triple net. Enjoy !
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- #113 of 134
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Acquisition Fee
by paotron
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Sep 18, 2008 (2:35 pm)
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I have just leased a 2008 S550 throuh Mercedes-Benz Financial and they charge me $1095 Acquisition Fee.
Does different bank set their own Acquisition Fee?
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- #114 of 134
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Re: Acquisition Fee [paotron]
by eights38
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Sep 18, 2008 (2:50 pm)
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Replying to: paotron (Sep 18, 2008 2:35 pm)
paotron - Each bank charges a different acquisition fee - Mercedes charges $795.
Matt
eights38 gmail.com
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- #115 of 134
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S550 in Texas Lease or Finance?
by decissions08
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Sep 22, 2008 (6:52 pm)
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I normally purchase my cars but have been offered an interesting proposal from a large leasing company that gets fleet pricing at a 6.7% discount with a 10K rebate which is 2.7% better discount than what I can do for a cash price. Their trade in offer is $3K better than the dealer. I plan on purchasing the car at the end of the lease so they have proposed a 48 month lease at the same cash outlay as a 60-63 month finance payment totaling $92,000. I plan on taking title to the car. I am concerned that the dealer will not honor service entitlements such as loan cars if it is sold to the leasing company first. Sales tax in TX (6.25%) is paid on the full value of the car at lease commencement, not your monthly payment, and then again on the residual should you purchase at the end of lease. Leasing company says they will offset these with tax credits and thus the value of my trade in becomes $22,500. Hmm? Here is the deal:
If I lease with an option to purchase:
MSRP $92,720
Less discount & rebate $16,212
Less trade in $16,000 ($6K to be applied to upfront costs, $10K rebate to me)
Total Car Price $60,508
Cash back $10,000
6.25% Sales tax to be wavied by offseting tax credits (this is new to me and a concern)
48 months
$1200 per month
Residual $28,000
Money factor 0.00219
Finance purchase from dealer:
60 month
$1330 per month
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