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Old 05-27-2008, 02:42 PM   #1
AVANTI R5
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Default BMW to increase U.S. prices by 1 percent

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Due to the weak dollar, BMW is planning to raise prices of some of its models by 1 percent. The increase will affect cars such as the X5 and the 5-Series starting June 1.
Its a moderate price increase that reflects the conditions in the market, said Markus Sagemann, a spokesman for BMW.

The dollar has dropped about 8 percent against the euro meaning that for every 5-Series BMW sells, it gets 2,000 euros (about $3,150) less than it did in the beginning of the year.
BMWs net income fell 17 in the first three months of 2008. For the first four-months of 2008, BMW sales fell 4 percent, or to about 100,000 cars. This is the first price increase from BMW since March 2007.
While it shouldnt be that drastic of a jump, if you were considering getting a BMW, you better head to the dealerships before June 1st and save yourself some money.

Source: Bloomberg
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Old 05-27-2008, 03:13 PM   #2
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i didnt see them lower prices when the dollar to euro ratio was 1.3 to 1.
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Old 05-27-2008, 04:01 PM   #3
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Originally Posted by happasaiyan View Post
i didnt see them lower prices when the dollar to euro ratio was 1.3 to 1.
Calm down, there's still a 7% disparity to where they "should" be and where they will be.
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Old 05-27-2008, 04:41 PM   #4
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Originally Posted by happasaiyan View Post
i didnt see them lower prices when the dollar to euro ratio was 1.3 to 1.
Have you looked at the Dollar/Euro exchange rate over the last 5 years? Considering the low value of the dollar, US customers would still be getting a killer deal if they raised the prices by 30%.

BMW M3 Coupe:
Germany - 56008 Euros (pre-tax)
US - $56500 = 35850 Euros
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Old 05-27-2008, 06:06 PM   #5
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you cant just go by exchange rate. eventually you will price your products out of their associated market.

...and actually, the german M3 is 66k euros.
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Old 05-27-2008, 06:35 PM   #6
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Even before the Euro, when Germany was using Marks, it made sense for Germans to buy a vehicle in the US and then import it to Germany if they wanted a fully loaded vehicle. At least it did for the one German family I know well!
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Old 05-27-2008, 07:51 PM   #7
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Originally Posted by happasaiyan View Post
you cant just go by exchange rate. eventually you will price your products out of their associated market.

...and actually, the german M3 is 66k euros.
66k after taxes, but it would be dumb to include taxes when comparing international pricing from the manufacturers perspective.

The point is, you can't blame BMW for raising prices by 1% when the dollar has lost much much more of its value. In 2002, when the Euro was introduced on a large scale, $100 bought 112 Euros. Today $100 buys 63 Euros.
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Old 05-27-2008, 09:12 PM   #8
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im not blaming them for raising the prices. all other car manufacturers sometimes raise them just cause they feel like it. bmw actually has a legit argument to do it.

my one-liner was more a jab, that if the conversion rate was in their favor, you better believe they wouldnt be lowering the price.
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Old 05-27-2008, 11:34 PM   #9
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Well, why would they? After all they've been eating the cost of the poor exchange rate for the better part of 6 years now. If they hadn't, a 335i would be slightly over $70k now.
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Old 05-28-2008, 01:43 PM   #10
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Well, why would they? After all they've been eating the cost of the poor exchange rate for the better part of 6 years now. If they hadn't, a 335i would be slightly over $70k now.
Not all their cars are German made. I'm pretty sure they make the X5's in the good ol' USA and BMW probably have currency hedges in place, as should any well run multi-national. Of course, those hedges don't go on forever and the US consumer is going to start feeling the pain on imported goods as the hedges roll off.
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