BMW has just announced a new program that allows current lessees of BMW vehicles skip as many as three monthly payments if they lease a selected new BMW. Most BMW models except M and 3-series vehicles are included.
It’s a great time to be in the market for a Bimmer. BMW is locked in a huge battle with Mercedes-Benz to gain the top spot in the luxury segment in the U.S., with both manufacturers spending more than the industry average in various types of incentives. As of the nine months ending September 30, Mercedes is ahead by 5,221 sales. Last year, it was BMW in the lead by 7,643 sales.
BMw is also involved with a bigger war: the one for top luxury brand in the world. However, this competition is not with Mercedes, which is a distant third at the moment, but with Audi. At the end of August, Audi was just over 2,000 worldwide sales behind BMW. BMW ramped up its efforts, giving it a very good September, and increasing its world-wide lead by about 20,000 year-to-date sales.
But Audi has the backing of Volkswagen cash and can play at that game if it wants to. If VW CEO Martin Winterkorn gave approval, Audi CEO Rupert Stadler could stand on a street corner in Ingolstadt and pass out enough Audis to fill the deficit without exhausting VW’s profit from the most recent quarter.
Audi has actually backed off its prediction that it would be the No.1 luxury carmaker by 2015: it’s now 2020. This is due to not only the two-pronged European market meltdown, but the slowdown in China as well. I say two-pronged meltdown because sales of upscale vehicles are not only being hit by the general collapse but, in some countries, because people are afraid to buy luxury vehicles because of the taxman. This is especially true in Italy, where heavily armed Financial Police are setting up roadblocks to check the tax receipts on upscale vehicles. We’re talking a trio of cops, at least one of whom is toting a submachine gun: even more effective than road spikes.
Of course, it’s going to be interesting to see who is No. 1 at the end of the year. If you’re betting right now, put your money on GM. Volkswagen still doesn’t have quite the sales, now that GM has worked out the legal issues to claim production of joint-venture cars in China, and Toyota may take a bit of a hit in the U.S. over recalls and a lot bigger hit in China because of the Senkaku Islands dispute. When the natives are burning your cars in the streets and vandalizing your dealerships, you’re probably not going to have a swell sales month.
Toyota, Honda and other Japanese automakers are scaling back their 2012 projections because of the Chinese situation, all of which plays right into the hands of General Motors.
It will be interesting to see if GM can offload Opel into a j-v with Peugeot. It might cost the General something on the order of $10 billion, but it might be worth it. It also frees GM to get more aggressive with Chevrolet and Cadillac in the European market.
In case you hadn’t noticed, it’s shaping up to be a wild year in the worldwide auto market.