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Aug
16
2012

The crisis is seen in Germany: auto dealers complain that, more recently, potential customers are bargain!


The crisis is seen in Germany: auto dealers complain that, more recently, potential customers are bargain!
BMW dealer



Auto dealers in Germany, used to easily sell premium cars at list prices or close amounts, complain that more and more customers come to negotiate and collect offers from several competing brands or stores.

"Every day, customers come to our showroom with offers from other companies or other BMW dealers. It became part of daily routine. Profits go down, eroding margins and discounts" said Werner Enternmann for Bloomberg, which is operating a BMW dealership in southwestern Germany.

Changing customer behavior in search of an automobile is one of the few material intrusions of state debt crisis in the euro area in the daily lives of Germans.

Germany, Europe's largest economy and biggest car market on the continent, in recent years has been an oasis of stability and growth in Europe. German car market increased by 0.7% in the first half of this year, compared to decreases of 20% in Italy and 14% in France, according to the European Automobile Manufacturers Association. The economy grew by 0.5% of GDP in the first quarter, 0.3% respectively in the second, and unemployment is the lowest level in two decades.

However, the German car market is not as good as it seems. Crisis suffocates demand for cars in most European countries and companies trying to increase business in Germany regardless of the intentions of customers.

Thus, in June, 87,454 vehicles are registered, representing 29% of the market, by the dealership or auto manufacturers, not customers, according to association of car dealers, ZDK.

So-called "pre-registration" totaled 500,000 cars in the first half, with 11% more than in the first half of 2011.

To get rid of those pre-registered car, many dealers sell cars faster as second-hand car with zero mileage, with a price reductions of over 20%, according to Ferdinand Dudenhoeffer, director of the Center for Automotive Research at the University Duisburg -Essen.

"Phantom sales" shows that dealers feel a pressure to reduce prices in southern Europe poured by strong markets such as Germany and Britain.

"It's a bloodbath in terms of price reductions. We work in an industry that needs volume, iron must be in motion, so that producers sell at discount," for Bloomberg said Andy Palmer, Executive Vice President Nissan Motor.

BMW, the largest manufacturer of premium cars, mainly targets potential rich customers, untouched by the recession, and hopes for record sales this year after launch, in February, of a new 3 Series variants. However, Germans are finding easy BMW cars at attractive prices.

Mobile.de site has dozens of offers from Italy, were a BMW 316d, the current generation, is put up for sale for 28,400 euros, 16% below list price in Germany. Dealers say that some customers come to negotiate with such deals picked up on site other countries.

BMW is not the only manufacturer in this situation. Also on mobile.de, a dealer in Rome offers Mercedes-Benz C200 CDI with automatic transmission, leather upholstery and alloy wheels to 33,499 euros, with 22% less than the list price in Germany.

In this context, the average reduction in the price of buying a new car has grown in Germany, in July, at 12% of list price, the highest level since August 2010, according to magazine Autohaus.

Italian automaker Fiat Group has provided the largest reductions in Germany, with an average of 14.7%, followed by PSA Peugeot Citroen and Renault, with 14.1% each.

"Everyone is chasing after customers who remained in Europe, and all cars not sold in the south are sent back to Germany," notes Ellighorst Arndt, an analyst at Credit Suisse.

via:zf.ro



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The crisis is seen in Germany: auto dealers complain that, more recently, potential customers are bargain!

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