Luxury-Car Sales In Steep Decline

[bmer]

Some quotes from the article:

In past economic slumps, luxury-car makers have withstood the downturn better than their mass-market counterparts. Not so this year.

Sales for the U.S. luxury-car market, which includes everything from a Lexus to a Lamborghini, fell 30% last month from a year earlier -- on par with the 31.9% decline for the overall market, according to Autodata Corp., a market research firm.

Among luxury cars, "we suspect that November was just as bad as October because people on Wall Street and in the banks are still losing their jobs," said Rebecca Lindland, an analyst with IHS Global Insight, a research firm in Lexington, Mass.

J.D. Power estimates that BMW AG sales will show a decline of more than 20% for November and that sales for Daimler AG's Mercedes-Benz unit will fall more than 40%.

October was especially hard for the top-end luxury vehicles. Porsche AG's sales fell by half last month from a year earlier, to 1,427 vehicles.

Bentley's sales fell 62% to 146, while Maserati's sales declined 29% to 157.

The weak luxury-car market isn't isolated to North America as economies from Japan to Germany are in or near recession. Stuart McCullough, board member for sales and marketing at Bentley Motors, says sales in the Middle East and China are stable but are sinking just about everywhere else.

"Even the oligarchs in Russia don't feel rich anymore," he said. "There aren't many bright spots in the world right now."

Sales rose 10-fold from 2004 to last year. But Bentley, the superluxury brand of Volkswagen AG, expects sales to drop to 5,000 vehicles next year from 10,000 this year.

Luxury Cars Sit As Both Money, Mood Slip Away - WSJ.com

 

[chonkoa]

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




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.



http://www.leftlanenews.com/ceo-say...n-its-history-other-execs-share-concerns.html

 

[EnI]

As said many times before: my sources had told me BMW AG would end the 2009 deep in red numbers if crisis continued.

BMW CEO said a while ago the goal for 2009 is to make some profit in the end, and not a loss.

Yep ... huge crisis ... from several billion Euros profit in the previous years to zero or even below.

Automotive industry & real-estate / construction industry are in huge troubles right now, and 2009 will be even worse. And if these two giant sectors start to fall down, many others will follow.

 

[Merc1]

Youch. I don't want to even see the Nov numbers now.

M

 

[Mr. Mercedes]

20% decline for BMW is bad, but 40% for MB is unbelievable. If MB still owned chrysler, they would be GONE already.

How long can MB and BMW surive like this Eni? How is this impacting on the plans for the holding entity?

Imagine a world with no BMW or Benz. lol

 

[Sunny]

Imagine a world with no BMW or Benz. lol

Short of end of western civilization, the brand equities are too strong to disappear one fine morning, even if the companies themselves go under.

 

[Mr. Mercedes]

Short of end of western civilization, the brand equities are too strong to disappear one fine morning, even if the companies themselves go under.

I understand that. But theres a big difference between a Mercedes branded vehicle and a real Mercedes. Like their products between 1999-2005.

 

[chonkoa]

As said many times before: my sources had told me BMW AG would end the 2009 deep in red numbers if crisis continued.

BMW CEO said a while ago the goal for 2009 is to make some profit in the end, and not a loss.

Yep ... huge crisis ... from several billion Euros profit in the previous years to zero or even below.

Automotive industry & real-estate / construction industry are in huge troubles right now, and 2009 will be even worse. And if these two giant sectors start to fall down, many others will follow.

Well, the bloke that runs the North American division thinks things are so great he isn't going to bother with maintaining a business.
In fact things are so great he decided to increase the price of the X6 just because things are so great.

 

[Merc1]

Well they all do that when sales are slumping, getting more from each unit sold. The price of the S550 just went up about 3.5K for 2009 also. Sell less, but make more per unit is the theory.

M

 

[Poverty]

Well, the bloke that runs the North American division thinks things are so great he isn't going to bother with maintaining a business.
In fact things are so great he decided to increase the price of the X6 just because things are so great.

who can justify buying something as obscure as a x6 in this crisis?

 

[ZicZachZo]

That's actually a very good point ^.

I think that if this downturn continues you will see much less 'niche' vehicles or at least see them selling in much fewer numbers.

A smart move for Mercedes imo and BMW would be to start producing the C and the 3 in America. The R class needs to go and they will need to re-evaluate the entire SUV line-up imo.

 

[far2000]

That's actually a very good point ^.

I think that if this downturn continues you will see much less 'niche' vehicles or at least see them selling in much fewer numbers.

A smart move for Mercedes imo and BMW would be to start producing the C and the 3 in America. The R class needs to go and they will need to re-evaluate the entire SUV line-up imo.

I sECOND THAT, The R Should have been gone a long long time ago......

 

[Merc1]

Dropped from a marketing standpoint yes, but with so much shared with the ML and GL, it likely doesn't make sense for them to do so. Sure it doesn't sell up to expectations, but they can move a few of them every month and nearly everything under the R is paid for already, so why not sell it long as it makes some financial sense? It doesn't cost Mercedes anything to keep making the R at this point. Production has been shifted to the GL and ML and to their diesel versions making the R nearly a special order vehicle from a dealer perspective. The R is around for the same reason the Maybach still is, cheap development costs and/or already paid for development costs. Dropping the R would only cause more excess capacity at the Alabama plant.

M

 

[ZicZachZo]

That's a good point. I just hope they aren't spending millions of dollars developing a new one.

They need to spend the money developing what pays the bills. C, E, S, etc.

I guess I was speaking more along the lines of future development of SUVs and what not.

 

[Merc1]

Well at this point I'm sure they are, but it won't be like the current one. The whole concept of a Mercedes crossover has to be re-examined and redone. If I know Mercedes they won't give up on the people mover concept, but will re-think it. The GL sells good right now, but it might be the one dropped next time around if the full size suv really does disappear altogether.

M

 

[conan_55]

On the contrary i think they should have more niche models. Bigger profit margin on smaller volume. Mainstream buyers will leave the German premium brands to the cheaper, "original" mainstream brands like VW, Toyota, even Peugeot.

The 3-series/C-class/5-series/E-class will not be selling like they used to. Stay relying on volume will be their achilles heel.