“A glut of off-lease vehicles…”, gee, I wonder where all those came from? Just maybe Joe Poseur and Jane Prada were in a little over their heads when they signed the deal on that shiny new 3-series. And who knew the rungs on that corporate ladder could be so slippery?

Why do you have to be the voice of reason?

Gotta love those leased vehicles, I plan on picking up a 335i pretty soon for pretty cheap.

It seems like the E90 depreciated much more quickly than the E46 did, or maybe it’s just me.

as if their showrooms weren’t good enough:-)

I think BMW showrooms are pretty nice. At least all the ones I visited were modern, clean and fancy. Not sure what needs to be invested there.

As for residual values, I am looking into a 530i 2007 and dealers are fighting and keeping prices too high. Specially in SoCal where there are so many Bimmers, you would think they would try to move inventory faster. I went to AutoTrader and there are more than 400 Bimmers advertise just for that specific model.

Lower the prices at least 10% and you might get more sales.

They have to clean up after all of the douchebags that spill their lattes on the showroom carpet.

How do you know it was just latte not the love juices upon conclusion of lease negotiation?

Actually the glut of off lease vehicles is a result of BMW mis-calculating what there residual values would be when returned.
This is the leaast they should do for the dealers who have brought them the majority of their sales and profits.

shaver, I don’t believe that is how it works with dealers. Dealers required by franchiser to upgrade their facilities. Each dealer is an independent operator and they operate under franchise rules. I can’t imagine how BMW corporate can put money into another private company hands. Also, 330M is less then 1 mil per show room. I think BMW will MAKE those dealers to perform upgrades in exchange for privilege to sell their cars.

Can I get some feedback on my thoughts – I always been a little taken back by dealerships that were too nice, to me it’s almost overwhelming and scary going into a high-zoot Mercedes dealer, even if you can afford something that’s on there lot. I just assume they assume their better than I and I just won’t go in. I like it when a place is nice and clean, but not too overdone so I don’t feel like I’m paying for the crystal chandaliere in the waiting room by buying their car.

Heck, the dealer I bought my VW was under construction and I bought my car in a trailer and couldn’t give a crap I wasn’t getting a swedish massage when signing the contract.

Jake, my favorite dealership is the second Chrysler store on our auto strip. The owner’s a wingnut, goes to Barrett-Jackson all the time and comes back with pieces that usually sit on the lot for years. Just about everything on the lot comes from a dealer auction and at last count they still had 8 Crossfires. When it rains you need hip waders to navigate the lot and the front of the store still says Jeep-Eagle if you can believe that. I’ve bought 7 cars off the same sales guy because we have a standing deal that whatever they’ve got into a vehicle it’s mine plus $500. And they know I don’t pay documentation fees.

I’m like you, if I walk into a dealership and my first thought is to start looking for an orchestra I know I’m in the wrong place.

Dealers are given low – read near 0% interest loans – from the manufacturers to improve dealership facilities. These loans are partly subsidized by franchise fees based on sales. Franchises are exactly that – LICENSEES, and the licensor, BMW, dictates the standards under which they must operate to continue. Therefore they are hardly independent businesses.

That being said:

My local Infinti dealer has a small mountain’s worth of granite flooring, luxury furniture, a kitchen/bar with a chef that can prepare fresh omelletes or crepes for breakfast, an espresso bar with plenty of gourmet coffees, a couple fancy of Infiniti Lifestyle display cases with attache cases and apparel, and a sound-proofed home theater with seating for 20 in the service department waiting area.

All these amenities still weren’t bringing customers into the showrooms. But a $19.99 oil service promotion sure did.

Leasing was a huge risk that luxury manufacturers took to increase production, spread development production costs among that greater production volume. While the manufacturers get the cars back, the lessees have much a lot of the depreciation on that good. And the manufacturer gets to sell a “lightly used” “pre-owned” – read USED – car.

That it took BMW from a niche 60,000 per year US sales player to a major 200,000 per year US sales player and over 1 million globally means the gamble paid off.

The risk was that consumers might run out of sufficient personal credit to pay for that type of indulgence.

What is so ironic is that BMW’s (and MB’s) reputation was predicated on the design and construction of purposeful cars that were aesthetically appealing and yet hardy enough to stay on the roads in one owner’s hands for decades and several hundred thousand miles. This reputation combined with low production volumes meant that the cars retained real value for their owners. The new BMW/ Mercedes leasing era ushered in a “lifestyle”. The new hype from Sindelfingen and Munich was that that the real value in possessing a luxury automobile was showing the world you could keep changing them like changing expensive shoes.

Except that consumers who buy expensive shoes such as Allen Edmunds tend to keep them for more than three years. They merely get them re-soled.

They should try investing into dealers who aren’t 18 years olds who know absolutely nothing about the cars they’re selling.
7 series test drive, so what are some of the packages on this car?
Dealer: Its got dual climate AC so you can set your side at one temp and mine the another. And it has GPS.

Wow.