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      12-29-2019, 01:34 PM   #2
Flacht3
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A lot to unpack here...Not an expert but IMO:


1// "diminishedvalueofgeorgia.com" probably shouldn't be construed as a leading subject matter expert, so take that info with a grain of salt.

2// Most auto dealerships don't make the bulk of their money on sales. They make it on the financing, add-ons, servicing and then profit margin on used car sales.

3// Noting the above, my take on BMW leases is that they're in the game of volume and scale. They make less profit per lease but enough profit to make it worthwhile and then volume makes up for it (last I checked, and could be wrong, BMW is leading sales volume in its class currently...aka beating Mercedes and the rest of them). This is how the dealer makes money. BMW corporate makes money by getting the dealers to buy as many cars as possible.

4//MSRP is of course "inflated" but not to that extent. A new M3 costs way more than $10k to produce, especially when you factor in the R&D, marketing, etc. which all go into the total cost. I'm no expert but on average BMW sells their cars at MSRP minus 7% to the dealer, so that 7% is the room for profit (before fees, financing, add-ons) the dealer can play with. I would guess it's "normal" for the car to cost 50% of MSRP to produce, but again you're probably looking at more overhead, R&D, etc. that needs to go into that.
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