BMW Earns Approximately $5000 Profit Per Vehicle

[MSteve5036]

But, about 30 percent of Ferrari’s business comes from engines, key chains

this made me lol

[ThugzZ BunnY]

what Fahrvergnügen said is exactly correct. only M cars will make 5 grand profit at the dealer level. there will be more cars that lose money than make 5 grand at the dealer level.

[CalCarNut]

Porsche's profit is in the options. They charge for everything (mostly) a la carte style. BMW 'kind' of does that as well with their packages but not to Porsche's extent. I doubt they (BMW) made $5K on my car as my option list was minimal and not high $...(Standard features were more than enough to pique my interest.)

[CalCarNut]

Originally Posted by M3 Adjuster

After seeing the article regarding the average Porsche profit at $17,xxx I feel a lot smarter being a lifelong BMW guy.


The BMW 1M and M2 are examples of low margin vehicles from BMW by the way, and have done exactly as intended , brought many newer, younger enthusiasts to the brand

Not sure I understood this one. How does a car that's marked up $30K above sticker (M2) bring in newer, younger people? Not much of a low margin if the dealers are getting that much above MSRP......

What am I missing?

[raysspl]

Is this gross or net profit

[Fahrvergnügen]

Originally Posted by CalCarNut

Porsche's profit is in the options. They charge for everything (mostly) a la carte style. BMW 'kind' of does that as well with their packages but not to Porsche's extent. I doubt they (BMW) made $5K on my car as my option list was minimal and not high $...(Standard features were more than enough to pique my interest.)

Assuming you are referring to your 428, I expect you are correct that BMW did not make $5k profit from your car since it is relatively on the lower end of the price spectrum when comparing all models. Again, the $5k is AVERAGE profit per car. A loaded M6 vert will have be more profitable than a 228i.

[Blackland]

So what is the average BMW dealer make on a new car sale?

[CalCarNut]

Originally Posted by Fahrvergnügen

Assuming you are referring to your 428, I expect you are correct that BMW did not make $5k profit from your car since it is relatively on the lower end of the price spectrum when comparing all models. Again, the $5k is AVERAGE profit per car. A loaded M6 vert will have be more profitable than a 228i.

I understand 'Average'..I was just bragging they didn't get that from me , although just because it's a 428 doesn't mean it's automatically 'cheaper' given the MSRP on loaded x28 cars. I just am not interested in a ton of options that are useless for me (Heated seats being one in SoCal) and then having to expect them to break at some point. I'm sure I'm in the minority here actually BUYING my car vs leasing it.

[Fahrvergnügen]

Originally Posted by CalCarNut

Not sure I understood this one. How does a car that's marked up $30K above sticker (M2) bring in newer, younger people? Not much of a low margin if the dealers are getting that much above MSRP......

What am I missing?

First of all, no one is paying $30k over for an M2 any more. That lasted, like, a week.

I think what he meant was the 1M and M2 had/have lower margins than other M (enthusiast cars) because of the lower price point / market they were sold in. Someone looking to get an M model doesn't have to spend $70k for the M3, but can spend $~55k for the M2, a sizeable spread. It casts a wider net of people looking for sporty cars, many that are younger. Same thing porsche did with the Cayman R and Cayman GT4

[CalCarNut]

Originally Posted by Fahrvergnügen

First of all, no one is paying $30k over for an M2 any more. That lasted, like, a week.

I think what he meant was the 1M and M2 had/have lower margins than other M (enthusiast cars) because of the lower price point / market they were sold in. Someone looking to get an M model doesn't have to spend $70k for the M3, but can spend $~55k for the M2, a sizeable spread. It casts a wider net of people looking for sporty cars, many that are younger. Same thing porsche did with the Cayman R and Cayman GT4

A week huh? Google 2017 M2s for sale. Check out the West Century BMW in Universal. Cost? $105K. Now tell me it lasted a week again. Seems all of their M2s are over 100k. Granted, I see others more reasonable, but local to me, they're still asking mountains of money over sticker. (And you're a moron if you pay that much for sure!). I see 0 at $55K-most are high $60s and many used.

Gotcha (red highlight).

[Fahrvergnügen]

Originally Posted by CalCarNut

I understand 'Average'..I was just bragging they didn't get that from me , although just because it's a 428 doesn't mean it's automatically 'cheaper' given the MSRP on loaded x28 cars. I just am not interested in a ton of options that are useless for me (Heated seats being one in SoCal) and then having to expect them to break at some point. I'm sure I'm in the minority here actually BUYING my car vs leasing it.

No one's calling your car cheap, just cheaper than other models BMW offers. The only option my 1M has is heated seats! lol... i prefer manual seats and no nav.

[Fahrvergnügen]

Originally Posted by CalCarNut

[/COLOR]

A week huh? Google 2017 M2s for sale. Check out the West Century BMW in Universal. Cost? $105K. Now tell me it lasted a week again. Seems all of their M2s are over 100k. Granted, I see others more reasonable, but local to me, they're still asking mountains of money over sticker. (And you're a moron if you pay that much for sure!). I see 0 at $55K-most are high $60s and many used.

Gotcha (red highlight).

hehe, you must be a riot to hang out with. Scroll down and you will see them at msrp Hollywood California is not a good measurement of what the real market is

[CalCarNut]

Originally Posted by Fahrvergnügen

hehe, you must be a riot to hang out with. Scroll down and you will see them at msrp Hollywood California is not a good measurement of what the real market is

Los Angeles/Southern Calif is the 'market adjustment' capital of the world (if you don't count the outrageous taxes that the Asian markets require to import a car). I mentioned there were some reasonable..but they are still marked up. That particular dealer wanted $210K for an M4 GTS...or $70K above MSRP.

Agreed...most places will not mark them up that much or at all..but given the local clientele around, they'll take their money every day of the week.

[kozzi]

Originally Posted by G35POPPEDMYCHERRY

mcdonalds makes 5000% profit on your soda

[SD ///M4]

Originally Posted by CalCarNut

[/COLOR]

A week huh? Google 2017 M2s for sale. Check out the West Century BMW in Universal. Cost? $105K. Now tell me it lasted a week again. Seems all of their M2s are over 100k. Granted, I see others more reasonable, but local to me, they're still asking mountains of money over sticker. (And you're a moron if you pay that much for sure!). I see 0 at $55K-most are high $60s and many used.

Just because a dealer is asking a huge "market adjustment" over MSRP doesn't mean that they're actually selling them at that price. These are showroom cars, meant to impress "browsers" and get people talking about them, just like you mentioned them in this forum. The only people who buy these cars are wealthy impulse buyers, and gives them bragging rights to say they paid $X over MSRP.

I know several people who have gotten or are getting M2s at MSRP. They ordered the car, waited for an allocation, and didn't pay an outrageous market adjustment price.

A local dealer has a M4 GTS on their showroom floor. Their initial market adjustment was $100K a few months ago, but it's now down to $25K. If you walked in with a serious intent to purchase, I'm sure that you could get it for pretty close to MSRP.

[CalCarNut]

^ Agreed. I'd order the car and stay away from the mark-ups. Another nearby dealer (where I actually bought my GC) is asking 'only' $5K above sticker LOL.

[M3 Adjuster]

Originally Posted by CalCarNut

Not sure I understood this one. How does a car that's marked up $30K above sticker (M2) bring in newer, younger people? Not much of a low margin if the dealers are getting that much above MSRP......

What am I missing?

apparently you are missing out on MSRP in California ... but that's not because of BMW NA. Not to mention that there are CA dealers that sell at MSRP. The MSRP of the M2 is approximately 12K cheaper than the M3/M4, which had been rising significantly the last 15 years and was beyond the 60K level. This lower MSRP has made the M2 accessible to a group of buyers that was being priced out of the M market.

IN addition, if you aren't aware... the dealer margin on the M2 is significantly less than that of other M cars, meaning that BMW is receiving less money on the sale of an M2.

Whether not there is markup at a dealer is an individual dealer decision.

Whether or not one pays a markup at a dealer is an individual personal decision.

One certainly isn't required to purchase a car in Cali either. There are 300 or so BMW dealers outside California.

[ThugzZ BunnY]

Originally Posted by Blackland

So what is the average BMW dealer make on a new car sale?

It depends on the market and the dealer. Most in our area (GA, TN, AL) are very aggressive and have heavy discounts. For instance; I sold 5 new cars last month and averaged $-1400 on the front end. That was three x1's and two x5's. there are too many dealerships within a two hour drive to make a lot of money on the front end.

[CalCarNut]

Originally Posted by M3 Adjuster

apparently you are missing out on MSRP in California ... but that's not because of BMW NA. Not to mention that there are CA dealers that sell at MSRP. The MSRP of the M2 is approximately 12K cheaper than the M3/M4, which had been rising significantly the last 15 years and was beyond the 60K level. This lower MSRP has made the M2 accessible to a group of buyers that was being priced out of the M market.

IN addition, if you aren't aware... the dealer margin on the M2 is significantly less than that of other M cars, meaning that BMW is receiving less money on the sale of an M2.

Whether not there is markup at a dealer is an individual dealer decision.

Whether or not one pays a markup at a dealer is an individual personal decision.


One certainly isn't required to purchase a car in Cali either. There are 300 or so BMW dealers outside California.

The chance of paying MSRP/above MSRP for me is nil.

So you're saying the M2 is the 'entry/budget' M car

[SD ///M4]

Originally Posted by CalCarNut

So you're saying the M2 is the 'entry/budget' M car

Well, it is the only new M car that you can purchase for $52,500 MSRP. The next cheapest M car is the M3 is $64,000 MSRP, so yeah, the M2 is the 'entry/budget' M car. Those are the facts.

Ferrari has said that their 'entry' model is a used Ferrari (oops, sorry, I meant 'previously owned').

[ASAP]

Either I am terrible at math or this is a very low margin business... if they make 5k on average... and their absolute cheapeast car is 33k, then the gross margin is 5/33 or ~15.1%... in one of the best case scenarios.

Again, this is not a good business to be in.

[Jenya B]

with 5k profit on car BMW supposed to pray for donation 24/7 .

Dont be fooled . Just imagine how much they spend on development and marketing .

If you guys divide MSRP price by 10 you will get real price to produce the car . (for example Dodge Gran Caravan cost 3200$ this price included part , labor , factory running expenses)

Back in Russia my brother in law was a dealer of MB and Volvo , they have 20% off from MSRP plus bonuses if they sell more than expected (ordered by sell plan )


So 5K could be profit from each car just by dealer .



Regarding POP DRINKS

I used to work with Coca Cola Russia , and they ordered caps and preforms from me , 2 litres bottle cost 2cents cap and 5 cents preform (smaller less , 2&3 cents ) plus Pop by itself 10cents , now figure out the PROFIT .