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CEO says BMW in “biggest crisis in its history;” rivals have similar concerns

11/27/2008, 5:00 PM

By Nick Aziz

BMW, which has seen it sales double since 1999, is now in the “biggest crisis in its history,” CEO Norbert Reithofer told Germany’s Spiegel. Like all automakers, BMW’s sales have been hit hard by the financial crisis, but the company’s reliance on leasing for a large percentage puts it in an even more vulnerable position.

Reithofer isn’t alone in his sentiment. Daimler boss Dieter Zetsche admitted the situation could easily be the “worst crisis since World War II.” If that’s the case, expect more job cuts and production slowdowns at Mercedes and BMW.

Even Volkswagen, which has a much broader brand and model mix, is concerned about its future. “We have never before seen this kind of a crisis,” chairman Martin Winterkorn said. He said it would be impossible for his company to avoid “difficult cuts” and “painful” measures.

According to the New York Times, luxury cars from BMW and Mercedes are beginning to pile up at U.S. ports. But they aren’t the only ones. Literally thousands of Toyota and Nissan models have filled acres of land at the port in Long Beach, California. In fact, Mercedes, Toyota and Nissan have requested to lease additional space at a 160-acre lot to park their slow-selling cars.

Recently, Toyota Executive Vice President Mitsuo Kinoshita characterized the current situation as “an emergency, of a magnitude we have never seen before.”

So is any automaker immune to the economic collapse in America, Europe, and Asia? Simply put: no. After all, Mercedes, BMW, VW, and Toyota are usually thought of as the most stable automakers in the world. Their survival will depend entirely on their ability to quickly adapt to slowing sales. Without the same rigid union and legacy costs of the Detroit Three, we’re hopeful they’ll all pull through.

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11/27, 5:14 PM

posted by:

idrinorbarsaku

well, i guess everone’s slowly getting fncked!

11/27, 5:14 PM

posted by:

idrinorbarsaku

*everyone’s*

11/27, 5:23 PM

posted by:

pdude

good… They charge over $2000 for transport and PDI here in Canada, at least on the 1 Series.

11/27, 5:28 PM

posted by:

DrFill

The 1-series is the sh!t!
DrFill

11/27, 5:50 PM

posted by:

howsmydriving

Uh, if BMW had, like, reasonable prices and didn’t gouge customers on service, they might, uh, see sales improve?

11/27, 6:18 PM

posted by:

Madcapp

BMW can take their $550 premium for metallic paint and shove it up their ass. And congratulations DrFill, you’re officially the first and only person in all of history who lacks the mental capacity to grasp what a wonderful (and relevant) car the 1 series is….you should wear aluminum foil so when you walk down the street, we all know to avoid you.

11/27, 6:29 PM

posted by:

carbonsigma

BMW can also take their X6s, Progressive Activity Sedans and other “lifestyle” vehicles and shove them up their ass too.

11/27, 6:38 PM

posted by:

LQQK TwiCe

Give them to me i’ll take the cars off there hands, and i’ll sell them at discount prices and make a living.

:-)

11/27, 7:07 PM

posted by:

350Zed

I have no sympathy for BMW. They’ve been price-gouging for years.

11/27, 7:09 PM

posted by:

kitko

Madcapp, actually, there are scores of people who think Series 1 one is A) dull, B) ugly, C) pointless, D) irrelevant. And I forgot, it’s also overpriced for what it is. DrFill is by no means the first one or the only one.

11/27, 7:10 PM

posted by:

nowei

Maddcapp, I believe DrFill was, in fact, praising the 1-series on account of his use of a definite article.

See here: http://www.urbandictionary.com/define.php?term=the+****

11/27, 7:16 PM

posted by:

nowei

Well, dang it. Now that link doesn’t work. Just replace the asterisks with the word DrFill was intending to spell.

I can’t believe that out of all the “poop” that gets thrown around on this site it somehow seems like a good idea to censor such a word. Although maybe that’s the point.

11/27, 7:37 PM

posted by:

DrFill

Forgot how “square” the people on this site are.
Square is the right word, right?
Wasn’t born in the Baby Boom
Forget spellcheck
I think I need Dr Suess to get a point across
DrFill

11/27, 7:41 PM

posted by:

johnnycanuck

They should bring all that excess inventory up to Vancouver where the 3 most popular makes are BMW, Mercedes and Courtesy.

11/27, 7:41 PM

posted by:

elviososa

i hate the x6, x5, x3…pointless cars.

11/27, 8:09 PM

posted by:

DrFill

They’re not cars
They’re “SAVs”, Sports Activity Vehicles
That caught on
DrFill

11/27, 8:11 PM

posted by:

Bimmer

Hey, BMW, what a big company you are! Let me buy you a pack of gum, I’ll show you how to chew it!
I say screw ‘em. What else were they expecting by raising prices? Why in Canada BMW 323i costs more then 328i in US even when Canadian $ was above $ US? Serves ‘em right! And, yes, howsmydriving is right, – lower parts prices for older vehicles!

11/27, 10:39 PM

posted by:

Mutant@DCX

Not as fun bashing imports, as it is the big three

no worries, electric will save us. lol

11/27, 11:48 PM

posted by:

PW

Mercedes sucks handlebar mustache. I hope they don’t survive this “crisis.” Keep BMW alive, though.

11/28, 12:18 AM

posted by:

Veda

I wonder how Audi is doing… should be better given they have better EPA due to the smaller and turbo engines.

11/28, 12:22 AM

posted by:

olds307

lol handlebar mustache

in reality, from a mechanic’s point of view, Mercedes>BMW

11/28, 1:17 AM

posted by:

Impulsive

This is ony the beginning. Forget leasing space …. how about stopping production? Nobody has a clue how bad things will get.

I remember having a tete-a-tete with some clown last year about how strong the US was and how good things were … facking retard, hopefully, is one of the losers who will suffer the most for his ignorance.

Buy gold, it will save you.

11/28, 1:48 AM

posted by:

Architect

So everyone’s in trouble, no doubt…this isn’t just a “Big 3″ thing…

Oh and Impulsive, wouldn’t it be proper form for you to take an ad out on this site for all the “gold” propaganda you keep foisting on us unsolicited?

11/28, 3:46 AM

posted by:

Sal Collaziano

You know what I say to these car companies? “You morons! Your automobiles cost WAY TOO MUCH!”. Stop being so damned arrogant with your pricing and people will buy your products again. What does a Mercedes S-Class start at? $90k? And you should set the GARBAGE options you get at that price. If you only want to sell to the few people who can afford Bentley’s, than you’re digging your own grave…

Sal C.
http://www.cadillacowners.com

11/28, 4:47 AM

posted by:

Don

well if they keep making more SUVs they won’t be better off any time soon. We don’t need an X6, X2, X4, or X10

11/28, 5:32 AM

posted by:

nkay

Your Comment

11/28, 5:53 AM

posted by:

nkay

You can justify any price on anything if you have product service, quality and reliability. I have nothing against BWM/Merc/AUDI prices if I get the value for money in the ownership experience. Business is business and companies have to grow and develop: this costs money so fine. However if I pay 80 thousand US then i expect the equivalent value in ownership experience and perfomance. I’m surprised the big 3 dont put more emphasis on refurbishing older models as another revenue source…maybe the numbers dont add up…

11/28, 7:22 AM

posted by:

AnonymousCoward

Basically Mostly Wankers? Actually, I have seen a journalists starting a review by saying the X6 is a pointless stupid car. And it doesn’t help it’s on the Top 10 list of the ugliest production cars of all time. Put a BMW badge on a pile of blended dog poo and the loyal followers would pay premium price for it.

11/28, 8:18 AM

posted by:

howsmydriving

I like the 1 Series but not the reason for its existence — that the 3 Series has become bloated.

11/28, 12:26 PM

posted by:

mayer_ray_nagin

So where are all the people that said only the Big 3 were retarded (not saying they aren’t) and that these grandly run euro and japanese corps dont have such issues? You have Toyota requesting $50B in loans, and the German majors all in crisis mode, and Porsche not buying more VW to conserve cash.

Face it people, the Big 3 are no different when it comes to mismanagement than any one else. Their problems are just compounded by image issues, but the effects of the pullback on their consumer purchases are filtering thru. The perrenial major-league selling Accord which just a few months ago sold 50K units in a month sold under 20k units in October – a 60% drop. The new TSX is selling at only half the rate of its predecessor. This is a global crisis, believe me.

As for BMW if they didn’t
….. B leed
….. M y
….. W allet
and weren’t so poorly built and so damned ugly then they maybe would be worth considering, but they are learning quickly that their badge-whore customer base also eventually must come to grips with reality.

11/28, 3:04 PM

posted by:

Impulsive

‘mayer’, yup.

‘Architect’, you stupid, ignorant dolt … it’s not propaganda when an intelligent individual, in no way associated with anything gold, only posts FACT and offers, for nothing in return, help to poor turd-for-brains like yourself by suggesting an investment vehicle that can offset losses one may have experienced or is shortly to experience. You really are dumber than the sole of my shoe and don’t deserve any help … maybe you can join that idiot from last year and suffer more than most.

11/28, 4:21 PM

posted by:

Borat

Impulsive, the price of gold index is about 50% down since January. If you are providing advise on “buy” when and how you will provide advise on “sell”? You can’t eat gold and to make money one must sell at some point.
I have a question: since you appointed yourself an intelligent individual, what is your qualification and criteria for such?

11/28, 4:24 PM

posted by:

Borat

Regarding BMW. I don’t drive one, but I think despite Bungle fiasco the company is great in marketing of their cars. If BMW states that there are troubles ahead, then without tax based cash infusion big 2.6 will croak. I suspect management is aligning expectations of investors with future reality. They also more blunt about it then anyone else.

11/28, 5:00 PM

posted by:

Impulsive

‘Borat’, it’s clear you are NOT one of the intelligent posters here with that mess of written prose.

Not only are your facts wrong … gold peaked in March over $1030 along with most gold related investments … but your illiteracy is frightening.

So I’ve provided the buy signal and now you want the sell signal? You greedy bastard. You do understand that one should buy low and sell high, right? Or does that evade you? I’d give you the short-term target but you don’t deserve it. Just know you will make a healthy return.

I didn’t “appoint” anything … I just stated FACT. If you’ve read and understood my posts over the last year you wouldn’t ask such a question.

11/28, 7:28 PM

posted by:

Get Real

Poor quality cars they sold for a premium didn’t make enough money to survive a downturn ???

Screw BMW and the sister-ship Mercedes.

11/28, 8:21 PM

posted by:

DB9

Midas touch to US$1250 by Caesar’s Ides! Too cryptic…nah;-) From my room with a view at the Mount Washington Resort in New Hampshire:-) Damn, they closed the window… housekeeping!

DB9

11/28, 8:54 PM

posted by:

Impulsive

‘Get Real’, couldn’t have said it better.

‘DB9′, have you done your homework or did you just google my past posts? Either way, some chimps didn’t deserve it.

11/28, 10:17 PM

posted by:

DB9

@Impulsive

Homework… nah;-) So; long story short, had some time to kill while waiting for the tailor to bring me my coat of many colors. Every time I got it back I saw a new color I wanted to add – It has three colors now:-) Even gotta deal on a Funky Hat:-)

DB9

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

“God is a comedian playing to an audience too afraid to laugh” Voltaire

“I rang for Ice but this is ridiculous” Madelaine Talmadge-Astor, as she was being helped off the Titanic.

11/28, 10:43 PM

posted by:

Architect

Impulsive – your obsession with gold is beyond weird, given that this is an automotive website. In fact, it borders on spam, which was my point.

11/29, 12:16 AM

posted by:

Impulsive

‘DB9′, I’d love to see the hat and the coat.

‘Architect’, I know what your point was … spam is the last thing you will see it as when gold does what it will. Maybe I am weird in wanting to help this “family” we have here.

11/29, 1:01 AM

posted by:

Architect

Impulsive – fair enough…just trying to give you a hard time! ;-)

11/29, 11:40 PM

posted by:

dorikin_86

Shouldn’t have made M3’s = $80,000 cars.

Nobody’s pay rate is increasing at that level.

12/01, 2:00 PM

posted by:

beemerdude

BMW’s marketing/pricing is sometimes sort of strange.

They include a sunroof at no extra charge…. but leather costs extra?

At the luxury/near luxury part of the market, a vehicle should come with leather as standard equipment. Then go ahead and charge extra for things like “Active Headlights.”

12/01, 2:24 PM

posted by:

V2

I love BMW but their cars are over priced! impossible to buy one in Australia unless you want a 1 series and even you hardly get any car for your money……………quite simple BMW, charge less for you cars and include options in your prices….but being stubborn germans that wont happen….what happened to you Germany, you used to be cool.

 
 
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