By on June 9, 2016

2016 BMW 340i

Discouraging results at BMW USA persisted in May 2016 as the brand continues to suffer from the successful, and somewhat artificially successful, end to 2015. May sales at the BMW Group tumbled nine percent, with blame largely falling on the shoulders of BMW’s most popular cars and the Mini brand.

BMW’s urge to generate record U.S. sales in 2015 ended with a 2,935-unit margin of victory over Mercedes-Benz, BMW’s chief global rival, and a 1,422-unit margin over Toyota’s Lexus brand.

News of the alleged victory, however, was followed by controversy, as it became increasingly clear that a chunk of BMW’s sales at the end of the year were spurious. “BMW paid its dealers as much as $1,750 a vehicle in December to put new models in their service fleets,” Automotive News reported in February. And without those sales, BMW was not likely the top-selling premium brand in America in 2015 – Lexus was. 

Yet beyond the rather unsurprising revelation that BMW was skewing sales figures was the pronouncement from AutoNation CEO Mike Jackson that luxury inventories were ballooning. In order for sales at BMW USA’s namesake brand to rise to an all-time high of 346,023 units in 2015 and for inventory to be cleared out, incentives had to match demand. At BMW, that meant an average of $5,019 in incentives in December 2015, the highest of any automaker, according to TrueCar.

Five months later, BMW incentives remain high and sales are consistently lower than they were during the same period one year ago. Year-over-year, BMW brand volume has decreased in six consecutive months, falling 11 percent since the beginning of December, a period in which overall auto sales grew 3 percent.

BMW’s overall U.S. numbers are certainly not buoyed by healthy Mini results. During the same six-month period, Mini volume tumbled 18 percent, a loss of nearly 5,500 sales.

As for May, specifically, TrueCar says BMW incentivized each sale to the tune of $4,978 last month, the highest of any automaker competing for U.S. sales.

2016 BMW X1 white

Even with this high level of incentive spend, BMW sales still fell 6.4 percent in May — meaning the brand’s daily selling rate did in fact rise — as industry-wide volume fell 6.1 percent. Year-over-year, sales of the 3 Series, 4 Series, and 5 Series plunged 17 percent, a loss of 2,844 sales not made up by the BMW SAV lineup’s 5 percent, 508-unit uptick.

As we reported one month ago, BMW isn’t the only premium automaker paying a difficult price, or languishing in the throes of a premium Irish flu, after bringing sales forward into 2015.

Through the first five months of 2016, sales at Cadillac are down 12 percent, Acura and Lexus volume is down 5 percent, and both Infiniti and Mercedes-Benz posted modest year-to-date decreases, as well.

Back at BMW, the company is fairly sure it knows what’s going on.

“The shorter number of selling days in May no doubt affected the month totals but the ongoing transition to X models remains clear,” said BMW USA CEO Ludwig Willisch in BMW’s June 1 sales release.

More ess-you-vees needed.

[Image Source: BMW USA]

Timothy Cain is the founder of GoodCarBadCar.net, which obsesses over the free and frequent publication of U.S. and Canadian auto sales figures. Follow on Twitter @goodcarbadcar and on Facebook.

Get the latest TTAC e-Newsletter!

15 Comments on “In May 2016, BMW USA Continues To Pay Price For Success In 2015...”


  • avatar

    I love BMW’s chairs. They can keep the rest of the car though.

  • avatar
    Felix Hoenikker

    Looks like BMW is acting more like FCA when it comes to incentives. Given the lackluster state of the US economy, I don’t see their sales improving in the near term even with this level of incentives.

  • avatar

    BMW does not have appealing new models that capture a prospect’s imagination. They are compensating with incentives.

    December 2015 in the auto business is a long time ago, its a done deal.

    The high inventories, one way for manufacturers to motivate dealer groups is to raise the inventories, its a dealer group/manufacturer thing. Flood the dealer with units and watch him sell his way out of the inventory.

    • 0 avatar
      sportyaccordy

      Capturing imaginations stopped being a necessary MO of luxury brands long ago.

      Bottom line there is only so much volume available. BMW is trying to capture more of it than their products warrant. MB releasing the new E class this year will put the nail in that coffin.

      Sad thing customers don’t care who is the top seller. Being #1 in channel stuffing doesn’t make one’s car better.

      • 0 avatar
        derekson

        Honestly I think BMW’s problem is that they lost focus on what made their products unique. Not all BMW drivers actually drive fast or care specially about dynamics, but they seem to care about the image that comes from that. As BMW has aimed for more mainstream customers and made the cars softer, they’ve lost what made them unique and just turned them into inferior Mercedes-Benzes. BMW doesn’t do luxury or style nearly as well as MB does, and trying to ape them is just setting BMW up for failure. Meanwhile MB is making their cars dynamically better without sacrificing much of what makes them luxurious and traditionally MB classy.

        Even Audi has their own mission and niche in a way BMW doesn’t anymore: they do a more minimalist, contemporary style vs Mercedes’ classic & traditional style. And Audi has a focus on high tech, good materials, and tactile feel of controls and materials that BMW and even Mercedes really don’t quite have. It has its own appeal to a certain customer, while BMW has managed to get caught in the middle with no real direction anymore.

    • 0 avatar
      Kyree S. Williams

      There’s the new 7-Series, but it’s going to be an also-ran in a segment where the S-Class reigns supreme.

      There’s the X1, which is in my opinion the best in its segment or close to it.

      A new 5-Series is due late this year or early next year. Of course, the E-Class is also getting redesigned and we already know that it’s going to shake up the field.

      We should also see a redesigned X3 in the near future. The 6-Series will see a redesign within the next year and a half, most likely.

      But it’s mostly going to be facelifts.

  • avatar
    Alfisti

    Jesus where are these incentives over here???

    We were shopping new BMW about three months ago and they wanted well over $750 a month for an X1 on a 3 year lease.

    I laughed all the way out the door but they would not budge.

    • 0 avatar
      a5ehren

      The average incentive on the X1 is probably extremely low.

      I’m guessing most of it is tied up in leased 3-series cars.

      • 0 avatar
        PennSt8

        I’m willing to bet that a big chunk of change is being spent on pushing i3s / 5s and the X3.

        On another note, the shift of consumer preference to crossovers, plus an aging product portfolio (5 Series and X3), appear to exacerbate BMWNA’s sales issues. A deeper dive into MB’s product portfolio, and it’s similar news. If I recall correctly, C Class sales are down 13% YTD.

    • 0 avatar
      windnsea00

      That’s nuts, are you in Canada? FWIW, my M3 lease is within a few dollars of that!

    • 0 avatar
      Kyree S. Williams

      What?! I would never! Even an X5 lease is, like, under $600 /mo.

      • 0 avatar
        Alfisti

        Yep Canada. A semi-loaded X3 is circa $900 a month.

        I am talking all in, taxes etc and nothing down.

      • 0 avatar
        jkross22

        That $600/mo X5 lease is for a base model X5 with $6k down or close to it. We looked recently at the new X5’s and the cost had me laughing as well. To get one with a 3rd row, it’s $800 + taxes/month. Plus the laughable down payments.

        No thanks.

  • avatar
    davefonz164

    BMW has been dumping cars at cost for years now. Extensive loaner programs, demos and so forth have accelerated sales at the cost of profit and exclusivity.

    People are so excited when they can get a 320Xdrive for under 500$ a month (Canada)……When I was selling Volvo’s, I was never able to match BMW or Benz at those prices.

Read all comments

Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • Hydromatic: Given your previous thoughts about MLK, I don’t see why you should care.
  • Lightspeed: Still with that awkward roofline, swing and a miss.
  • mor2bz: Reliable car to 100k mi., then, not so much. nice riding and handling. judge the looks for yourself. That...
  • msquare: Because the Imp came out in 1963, after the Contessa and long after the 4CV. If anything, the Imp...
  • aja8888: There is no more “American Dream”.

New Car Research

Get a Free Dealer Quote

Who We Are

  • Adam Tonge
  • Bozi Tatarevic
  • Corey Lewis
  • Mark Baruth
  • Ronnie Schreiber