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Misery enjoys company, so it's somewhat comforting to see formerly arrogant automakers like Daimler and BMW somewhat humbled.
 

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If I read the article correctly in today's paper, BMW is pushing their lease rates up much higher in Canada and eliminating some lease options on their cars.

I also noticed that Toyota bumped their lease options up substantially and seems to be pushing low interest purchase options much as GM has started doing.

This may be the end of the cheap lease.
 

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If I read the article correctly in today's paper, BMW is pushing their lease rates up much higher in Canada and eliminating some lease options on their cars.

I also noticed that Toyota bumped their lease options up substantially and seems to be pushing low interest purchase options much as GM has started doing.

This may be the end of the cheap lease.
No more low lease rates = the 3 series will no longer be more popular than Accords here in the GTA.
 

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No more low lease rates = the 3 series will no longer be more popular than Accords here in the GTA.
If you have to keep it long term -- i.e., out of warranty -- BMW is hosed. I don't know anyone willing to own a BMW out of warranty. Everyone I know who has one leases. This could all get very ugly very fast.

I wonder what will really happen now? Didn't BMW and Porsche have serious financial problems a while ago during the last economic downturn? Will this bring back those bad old days?
 

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Making $800 million/quarter instead of $1,000 million/quarter is not exactly the end of the world, especially considering the market conditions.
 

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Making $800 million/quarter instead of $1,000 million/quarter is not exactly the end of the world, especially considering the market conditions.
Yeah, but that's what GM said in the 80s. Look at them now.

BMW and others have to gauge whether their sales were directly tied to cheap money. If it was, then those sales are gone and so are the profits. Many folks run their finances way too close to the wire, and minor changes result in serious havoc. And major changes -- like now -- result in panic or worse.
 

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If you have to keep it long term -- i.e., out of warranty -- BMW is hosed. I don't know anyone willing to own a BMW out of warranty. Everyone I know who has one leases. This could all get very ugly very fast.
I don't think BMWs are that bad reliability-wise and quality-wise.

Most people lease BMWs because BMW leases are affordable.

However, I would be terrified if I had to own a Mercedes out of warranty.

Just terrified.
 

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ship cars produced for the U.S. to other markets after sales ``deteriorated sharply over the past weeks.'' His prediction of ``another difficult year'' in 2009 comes seven days after Daimler AG lowered its forecast. Car sales in the U.S., BMW's biggest market, have fallen 10 percent this year
Good news for Americans employed in factories that make Cadillacs.
 

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Yeah, but that's what GM said in the 80s. Look at them now.

BMW and others have to gauge whether their sales were directly tied to cheap money. If it was, then those sales are gone and so are the profits. Many folks run their finances way too close to the wire, and minor changes result in serious havoc. And major changes -- like now -- result in panic or worse.
Not every company with a drop in profits is 80's GM, especially if said drop occurs during an economic crisis and all the competitors are having the exact same problems.
 

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Not every company with a drop in profits is 80's GM, especially if said drop occurs during an economic crisis and all the competitors are having the exact same problems.
Never said that. Just said you have to watch out because a drop can either be market driven, a bad economy, or a harbinger of something worse.
 

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I don't think BMWs are that bad reliability-wise and quality-wise.

Most people lease BMWs because BMW leases are affordable.

However, I would be terrified if I had to own a Mercedes out of warranty.

Just terrified.
Those of my friends and family that have or own BMWs, to a one would never own one out of warranty. They just haven't been that well built.

And when I talk to my friends that own Porsches and they tell me how much an oil change costs, I just shudder.
 

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Congratulations. If you have a 1 year old BMW, you don't have too many problems. If you have one that is out of warranty, run for cover.

As far as the sales downturn goes, I would not be too concerned. Just wait until the 11 mpg X6 M comes out. That will do wonders for sales.
 

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I know about that chart, I'm just saying folks I know that own BMWs don't tend to buy into it, especially not out of warranty. That chart is cars that are 3 years old -- i.e., in warranty. Out of warranty is where it starts to hurt, according to my friends and family that have tried to own a BMW more than 4 years.
 

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I know about that chart, I'm just saying folks I know that own BMWs don't tend to buy into it, especially not out of warranty. That chart is cars that are 3 years old -- i.e., in warranty. Out of warranty is where it starts to hurt, according to my friends and family that have tried to own a BMW more than 4 years.

Was it repairs or was it because BMW no longer covers all the maintenance after that point?
 

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Was it repairs or was it because BMW no longer covers all the maintenance after that point?
Both, but mostly the repairs. The last straw for one of my uncles came a few weeks ago when his 5 year old 3 series wouldn't start. He had to fix it and then traded it in on an Accord. No more BMWs for him. He's had nothing but problems once the warranty expired. He said he's through with German cars.
 

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Yeah, but that's what GM said in the 80s. Look at them now.

BMW and others have to gauge whether their sales were directly tied to cheap money. If it was, then those sales are gone and so are the profits. Many folks run their finances way too close to the wire, and minor changes result in serious havoc. And major changes -- like now -- result in panic or worse.
Their sales were hugely tied to cheap money, especially in the form of leases. This is bad news considering that 60% of BMW sales were in the form of leases rather than retail purchases.

Leases account for 60% of BMW's sales in the U.S. compared to just 20% of sales in the industry as a whole. As such, BMW will begin offering incentives like never before to encourage customers to buy a vehicle instead and reduce the number of leases it has on the books. In some cases the German brand is offering loans with finance rates as low as 0.9% over five years, and of course these incentives will be aided by a commensurate raise in lease prices, as well.
Without the ability to cheaply finance leases, BMW sales, and those of other luxury makes, will suffer tremendously.http://www.autoblog.com/2008/08/01/leases-hurting-luxury-automakers-bmw-wants-you-to-buy/
 

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I don't know anyone willing to own a BMW out of warranty. Everyone I know who has one leases.
BMW does rely heavily on leases. A friend of mine is a sales manager at a BMW dealership in SoCal, and he says 90-95% of his customers lease. But it's less because of maintenance concerns than the attractive rates they've had -- you can lease a 7 series for less than the payment on a 328. Also, a good chunk of BMW buyers are the type who won't keep a car longer than 3 years, so why not. BUT, whetever the reason, high lease rates will hurt BMW quite a bit.

I would be terrified if I had to own a Mercedes out of warranty.
Yup, MB has been terrible lately.

Good news for Americans employed in factories that make Cadillacs.
Except Cadillac is being starved -- STS and XLR being killed, DTS replacement delayed, BTS uncertain, Escalade sales tanking. Cadillac can live on the CTS alone for only so long.

zete said:
And when I talk to my friends that own Porsches and they tell me how much an oil change costs, I just shudder.
Just out of curiosity, how much (the people I know who own Porsches change the oil themselves)?
 

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Both, but mostly the repairs. The last straw for one of my uncles came a few weeks ago when his 5 year old 3 series wouldn't start. He had to fix it and then traded it in on an Accord. No more BMWs for him. He's had nothing but problems once the warranty expired. He said he's through with German cars.
From my experience with BMW only the X5 gave me problems. LOL sometimes the door wouldn't open. But that car was like 7 years old and maybe 300km and had been in a major accident.

All the 3 series I've experienced have been great. Usually about 4 years old sometimes a little older and they're holding up very well.

However, if something does break on a BMW its going to be incredibly expensive, sometimes I wonder why the Germans don't simplify the mechanics a little.

VW actually might be the worst in that regard.
 
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