View Single Post
      09-04-2013, 11:05 PM   #24
fuddman
Major
353
Rep
1,401
Posts

Drives: 528-maybe
Join Date: Aug 2010
Location: California

iTrader: (0)

Quote:
Originally Posted by Carlos_Danger View Post
Can anyone enlighten me into how do dealerships profit from allocations on ED, since you're literally buying directly of the factory?
Unless you are the owner of the dealership, you're never going to know how a dealer makes his profit, from ED sales or otherwise. That's because you don't have access to his books, methods, etc. Seems obvious enough, yet, a lot of buyers spend a lot of time obsessing over this.

As a consumer, the fundamental principal you need to keep in mind about ED pricing, or any pricing, for that matter is this: neither the dealer nor BMW is going to sell you a car for $60,000 when they know they can sell it to someone else for $65,000.
What follows from that is: if the dealer let's you buy one of the cars he owns for ED pricing, then the dealer knows that's the market price. Putting two and two together, then, if you buy a car from a dealer and go pick it up in Europe for an ED price of , say, $60,000, you can be reasonably certain you can buy that same car, in the states, for the same amount.
On the issue of buying a car at ED invoice. That car is not owned by the dealer but by BMW. And when BMW allows this pricing to happen, they are revealing to you that the car is not selling fast enough for the assembly line. Again, that means there is a strong possibility you can get the car in the states for the same amount.
Of course, the reverse is also true: if the car sells better than expected then, the price will go up regardless of what the sticker says.
That's the way I see it, anyway.
Appreciate 0