Price to produce the M5
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Joined: Oct 2008
Posts: 763
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From: London, ON
Are you high on crack? First of all, M5's are cheaper in the US, a bare M5 is the US costs just around $86,000 and they don't make a lot of money on a bare M5... [size="4"]you do understand that you live in England right?[/size] Your M5 costs that much because your paying taxes out the ass to the government. BMW makes money on the mass produced cars, 3 and 5 seires (non M). They still make money on the M, but the margins are smaller. A bone dry M does not make a lot of revenue. Other cars might make 10-17%....but not a bone dry M. They make more if the car is loaded, and usually people buy M5's with a lot of options...
Actually London, England is approx. 3662 miles from London, Ontario.. and i have no clue about thier tax rates... but i do know that here in London, Ontario... we pay 13% tax (8% Provincial, 5% Government)which is f*cking STEEP, and a hell of a lot more for an M5 then $86,000.. 2009 models started at $113,000.. 2010 models are priced at $106,900 for basic, and around +/-$120,000 for fully jammed..
I just dont agree with the 4% markup on the M5... thats all.. no crack, no coke.. just my uneducated opinion
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Joined: Mar 2009
Posts: 10,301
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From: New York, New York
My Ride: See my signature
I agree with swajames that the profit margin on a low volume car like the M5 has to be considerably slimmer than for the lower E60s that sell in much greater numbers. The M5 has a large amount of parts that are unique to it (or shared only with the even lower volume M6). Low volume equals more cost per part.
BMW makes the M5 as a halo sedan to build brand image and excitement for lesser 5 Series. The real profits are in the lower E60s.
BMW makes the M5 as a halo sedan to build brand image and excitement for lesser 5 Series. The real profits are in the lower E60s.
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Joined: Aug 2008
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From: Originally from Koeln, Deutschland. Enjoying it in Bonita Springs, Florida Now :)
Actually London, England is approx. 3662 miles from London, Ontario.. and i have no clue about thier tax rates... but i do know that here in London, Ontario... we pay 13% tax (8% Provincial, 5% Government)which is f*cking STEEP, and a hell of a lot more for an M5 then $86,000.. 2009 models started at $113,000.. 2010 models are priced at $106,900 for basic, and around +/-$120,000 for fully jammed..
I just dont agree with the 4% markup on the M5... thats all.. no crack, no coke.. just my uneducated opinion
I just dont agree with the 4% markup on the M5... thats all.. no crack, no coke.. just my uneducated opinion
merely making an uneducated guess
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Joined: Feb 2005
Posts: 2,075
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From: NY
I too agree with swajames. His explanation of margins and price points is very accurate. In the way of automotive companies, BMW is NOT a very big company. (1mil cars produced in 09 - GM produced 8.3mil - Toyota 8.5mil) Their bread and butter is the high volume product. (3 series) Thats at the top of their food chain. Everything else falls below. When you speak specifically about ANY "M" series car, their margins are much slimmer because of the reason pointed out by swajames. Its actually all public information available in their annual reports. 09 Annual reports
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Joined: May 2009
Posts: 10,496
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From: SoCal
My Ride: 2008 550I LOADED, all options except HUD and NV
I too agree with swajames. His explanation of margins and price points is very accurate. In the way of automotive companies, BMW is NOT a very big company. (1mil cars produced in 09) Their bread and butter is the high volume product. (3 series) Thats at the top of their food chain. Everything else falls below. When you speak specifically about ANY "M" series car, their margins are much slimmer because of the reason pointed out by swajames. Its actually all public information available in their annual reports. 09 Annual reports
There is a reason I brought up the Veyron, VW loses money on each one, but they still produce it.
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