BMW beats Mercedes-Benz to claim first U.S. luxury sales crown

[Alan Smithee]

Vying for highest sales volume in a segment, especially by providing incentives, is incongruous with a "luxury" brand. I am not impressed.

[Richard in NC]

Originally Posted by Alan Smithee

Vying for highest sales volume in a segment, especially by providing incentives, is incongruous with a "luxury" brand. I am not impressed.

I disagree. Incentives, IE appropriate pricing is a characteristic of capitalism and the free market, regardless of the commodity. And I only took a few economics classes....

I am impressed with the 40k X5s and 50k 5 Series, incentives or not.

[Alan Smithee]

Originally Posted by Richard in NC

Incentives, IE appropriate pricing is a characteristic of capitalism and the free market, regardless of the commodity.

It is a characteristic of oversupply, and the result is devaluation of the brand.

The formula did not work for GM and Chrysler in the long run, and it will not work for BMW and MB, either.

[LeMansX5]

Its not just that BMW was providing the incentives. Mercedes was providing huge incentives as well. The race was to have the "#1 in US" crown, as Lexus has been #1 since 2000 and this year supply problems crippled them, leaving BMW and Benz in race. Lexus may be back next year.

[Price]

Originally Posted by Alan Smithee

Vying for highest sales volume in a segment, especially by providing incentives, is incongruous with a "luxury" brand. I am not impressed.

I somewhat agree, although while the segment BMW/Merc/etc position themselves is called "luxury", in reality it's more of a "premium", or "upscale", rather that "exclusive", so the risk of diluting the brand is not as high as for, say, Aston Martin brand (regrdless whether AM are trully great cars or not). And yes, BMWs incentives have been always huge, the subsidised leases alone contribute greatly.

[Alan Smithee]

Originally Posted by Price

I somewhat agree, although while the segment BMW/Merc/etc position themselves is called "luxury", in reality it's more of a "premium", or "upscale", rather that "exclusive", so the risk of diluting the brand is not as high as for, say, Aston Martin brand (regrdless whether AM are trully great cars or not). And yes, BMWs incentives have been always huge, the subsidised leases alone contribute greatly.

Discounted new purchases/leases combined with an increasing flood of lease returns is a double-whammy for re-sale values.

Add in the increasing amount of obsolescence and unreliability BMW is building into their cars, and the great strides the American and Korean manufacturers are making at lower price points, and their "premium" brand formula is not a sustainable one, IMO.

[BGM]

Originally Posted by Alan Smithee

Discounted new purchases/leases combined with an increasing flood of lease returns is a double-whammy for re-sale values.

Add in the increasing amount of obsolescence and unreliability BMW is building into their cars, and the great strides the American and Korean manufacturers are making at lower price points, and their "premium" brand formula is not a sustainable one, IMO.

1) BMW and Lexus have been discounting and are mainly leased but residuals are still strong. The used car market has also increased in demand with the "down" economy. So, they off-set any projected decline in residuals.

2) I know you aren't comparing a Kia to a BMW.