There was a time when owning a new BMW meant you had achieved ultimate success. The brand was the pinnacle of luxury and, in order to buy one, you had to be able to pay the asking price. Dealers didn’t need to negotiate too much because they knew a willing buyer was always around the corner.
That was the nature of BMW. It took cash, and a lot of it, to have the pleasure and the privilege of owning the exclusive ultimate driving machine.
Times are changing, though.
Audi, Mercedes-Benz, and even Lexus sell cars that can outshine a Bimmer. That’s a truth being felt at dealerships across the country, and BMW devised a plan to do something about it. It loaded up dealers with vehicles in an attempt to increase volume and become the number-one luxury nameplate in America.
That plan has backfired.
An automaker will typically liquidate inventory when a glut of unsold cars piles up on dealer lots. They’ll entice shoppers with money back or cheap leases to move metal and make room for incoming vehicles. Heavy incentives are typically the fare of non-luxury automakers that will sacrifice some brand equity for a quick sale, but the luxury automakers try to avoid such tactics to keep residual values high.
BMW, though, finds itself in the uncomfortable position of having too many unsold cars sitting at dealerships. Automotive News said,
Comments from BMW executives confirm bearish remarks made by major dealership groups that said cars such as the 3 Series were sitting on showroom lots, declining in value with each day.
We can partially blame cheap gas for the unsold inventory. Sales of BMW’s X3 and X5 SUVs are up as American consumers have driven off lots confident that fuel prices will remain low. The rest of the blame falls on BMW for chasing the sales crown.
Everyone wants to be number one in sales, but in order to do that automakers have to drive traffic into dealerships and have a wide variety of vehicles available for immediate purchase. That can backfire when the demand isn’t there and the cars wind up on the lot, slowly depreciating, for months. That’s what happened with the 3 Series, but don’t expect BMW to make that mistake again anytime soon.
BMW and its dealers will want to quickly clear out their 3 Series inventory, along with the slow-selling electric i3, to make room for more in-demand vehicles, so the environment is ripe right now for scoring a great deal on the 3 Series of your dreams.
If, that is, you’re okay with your neighbors having one, too.
Will you try to score a deal on a BMW?
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-tgriffith