[Longboarder]

Do dealers get allocations for X5's or does BMW just make as many as they can crank out? Alternatively if dealers get allocations for X5's how does it work? For example would a dealer get a pre-determined number of allocations for each sub-model such as: twenty 40i models fifteen 50e models, ten M60i models and five X5M's? Or in this scenario do they just get fifty "X5" allocations and then the dealers and customers can order whatever kind of X5 they want?

[TurtleBoy]

BMWNA issues the allocations to the dealers based on a formula. A big part of that will be the dealer's sales volume. There will be separate allocations for the sub-models as you call them. For some series they can be converted, I don't think that is the case with the X5's.

[Longboarder]

Originally Posted by TurtleBoy

BMWNA issues the allocations to the dealers based on a formula. A big part of that will be the dealer's sales volume. There will be separate allocations for the sub-models as you call them. For some series they can be converted, I don't think that is the case with the X5's.

Got it thanks. While I'm sure BMW is good at predicting demand, could there be situations where dealers are requiring customers who order LCI 50e's at MSRP+ (anticipating significant increases in demand for this sub-model), whereas customers who order less-desirable models like maybe the M60i can order at big discounts to MSRP? I guess it varies dealer to dealer as demand is probably localized somewhat.

[TurtleBoy]

Originally Posted by Longboarder

Got it thanks. While I'm sure BMW is good at predicting demand, could there be situations where dealers are requiring customers who order LCI 50e's at MSRP+ (anticipating significant increases in demand for this sub-model), whereas customers who order less-desirable models like maybe the M60i can order at big discounts to MSRP? I guess it varies dealer to dealer as demand is probably localized somewhat.

Without a doubt, it happens all of the time. Look at the discounts we have been seeing. The 40i's are often in the 7-10% range, the M50i's around 5% and the 45e close to MSRP in some areas. Historically discounts varied by region. In the NorthEast area 10% was routinely reported while in the PNW if you got 4% you got a great deal.

[Longboarder]

Originally Posted by TurtleBoy

Without a doubt, it happens all of the time. Look at the discounts we have ben seeing. The 40i's are often in the 7-10% range, the M50i's around 5% and the 45e close to MSRP in some areas. Historically discounts varied by region. In the NorthEast area 10% was routinely reported while in the PNW if you got 4% you got a great deal.

I have to imagine BMW sees past sales data and then aims to build more of the popular models and less of the models that aren't so popular. The "e" model seems to be gaining a lot of momentum and now with the massive horsepower bump and tax incentives, seems like it could significantly cannibalize sales from both the 40i and M60i models.

But sounds like from what you are saying, BMW has already pre-determined the amount of 50e X5's that will be produced and regulate demand on other models perhaps with other incentives (discounts off msrp, higher residuals and lower MFs on leasing, lower int rates on purch financing, etc).

[jad03060]

While the dealer's cost is fixed, what he actually sells the vehicle for is entirely up to them. Now, depending on how much cash he has, an unsold vehicle sitting on his lot may have tied up a bunch of cash, or may have a big interest rate he may need to pay, so a one sitting there may go for less because he's bleeding money for it, so a deal may be made.

While BMW sets a 'suggested' list price, what the dealer gets for it from his customer is a negotiation between the two parties.

[AlexGP]

Originally Posted by jad03060

While the dealer's cost is fixed, what he actually sells the vehicle for is entirely up to them. Now, depending on how much cash he has, an unsold vehicle sitting on his lot may have tied up a bunch of cash, or may have a big interest rate he may need to pay, so a one sitting there may go for less because he's bleeding money for it, so a deal may be made.

While BMW sets a 'suggested' list price, what the dealer gets for it from his customer is a negotiation between the two parties.

and so what is the cost of the LCI for a dealer? (ballpark at least)

[TurtleBoy]

Originally Posted by AlexGP

and so what is the cost of the LCI for a dealer? (ballpark at least)

As far as I know, they are still using the same invoice calculations that they switched to in 2017. I think they are still getting a holdback of 5% of MSRP in certain situations. Of course there can also be bonuses, sales quota incentives, etc. that they can make.

BMW US Invoice Pricing calculation
Base vehicle US MSRP (from pricing sheets) multiplied by 0.93
+ MACO fee $500.00 (flat rate applied to all dealers)
= Base vehicle US BMW invoice price

To figure the invoice price of your BMW as configured add -
+ Option and packages (anything you can add to the vehicle) multiplied by 0.92
+ Training fee of $180.00
+ Destination and handling charge - Currently $995
= Total vehicle invoice price +/- $10.00