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08-14-2007, 07:46 AM | #1 |
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Tom Puves, BMW NA CEO
in an interview with Automotive News said the euro:dollar ratio will affect 1 Series pricing, which has not been set - but, he added, "We can deal with it."
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08-14-2007, 08:10 AM | #3 |
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The 3's pricing already moved up with the introduction of the E92 and E93. BMW has already made room at the bottom for the 1. And the dollar keeps slipping against the euro. If you buy European food items in the grocery store, you've witnessed significant inflation over the last 5 years. Fuck Geroge Bush and the Republicans, they're making a complete mess out of many aspects of this country...its not just limited to Iraq.
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08-14-2007, 08:20 AM | #5 |
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I think BMW is hedged all over the place on short-term and long-term valuations of the $. At least one of the business magazines, Forbes, predicts dollar to euro rates leveling and dollar rising in value in 18-24 months.
Of course predictions don't amount to a hill of beans, but the American economy is going into an area of post-industrialization where we specialize in ideas and "soft" products rather than smokestack industries. So there is this volatility not in a market sense but at a stage of development that is in unchartered unknown unpredictable territory. Exciting stuff. The other thing is BMW/NA itself and Tom Purves in particular. I don't think BMW's US arm is exactly the farm team for the major (Munich) leagues. Purves is smooth, cosmopolitan, but I think he has little or no power at all within the organisation...it's the people who run Spartanburg and Designworks who are the influential US employees on career track.. |
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08-14-2007, 08:24 AM | #6 |
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The 3's pricing went up with the introduction of more powerful powerplants, justifiably. BMW (both AG and USA) can't bury their head in the sand and not take into account the rest of the pricing in the US. Their competition has been nipping at their heels, closer and closer, for the past 5 years, and they cannot afford to lose out to them, even if it makes the profits dip a bit.
This has nothing to do with GWB, though the nearsighted might wish to simplify things into a tidy package that makes absolutely no sense. (and I'm a Dem) |
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08-14-2007, 08:54 AM | #8 |
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08-14-2007, 08:56 AM | #9 |
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imho:
1) bmw needs to gain a foothold in the US market with the 1 series. for this reason there is incentive for them to aggressively price the car (at least the 128 ... perhaps the 135 retains a premium as what i believe is referred to as a halo car). i see it similarly to microsoft introducing the xbox ... the analogy is far from perfect but my point is that i believe, in the short term, market share is paramount to revenue/car. 2) bmw can't price the car out of the bounds set by the other players in the market and their own models. the market and their other cars (e.g. 3 series) have defined a competitive range already. for these reasons, i believe bmw is constrained into a certain price range and we shouldn't be especially worried. how long till our verbose friend from munchen arrives? :biggrin: |
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08-14-2007, 09:01 AM | #10 |
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Speaking of missing Euro's...I wish EniLab contributed to the site. I've asked him a coupla times to at least do some time sharing between GCF and here...he is all up on economics and marketing...with valuable info.
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08-14-2007, 09:38 AM | #11 |
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Drives: e46 330ci, e92 335i, 2008 128i
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08-14-2007, 09:59 AM | #13 | |
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08-14-2007, 10:51 AM | #14 |
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08-14-2007, 12:03 PM | #15 |
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Spin doctor...of course he's not responsible for the valuation of the Euro, but his economic policy and geopolitical disasters are directly responsible for the decline of the Dollar in relation to the Euro.
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08-14-2007, 02:00 PM | #17 |
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Very true. "Dealing with it" could mean anything from raising the price and coping with lower sales to accepting reasonable losses and placing it as a "loss leader" for the brand for a short time.
Without more context you really have no idea what was meant by that comment. |
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08-14-2007, 09:12 PM | #18 | |
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+1 |
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08-14-2007, 09:47 PM | #19 | |
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Smaller CEO bonuses?
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08-14-2007, 11:34 PM | #20 | |
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No administration has done more to damage the value of the dollar since the USD was taken off the gold standard. Back in 2003, the Bush administration started touting the benefits of a weaker dollar for US manufacturing. A weak dollar has been pushed as the solution to the trade deficit by the Bush administration. Bush policy affects BMW owners by intentionally making BMW's more expensive in relation to Fords, Chevy's, and Dodges. This is not a mistake, or the will of the market. This is a calculated Bush monitary policy decision to use a devalued dollar to push sales of US cars and other US products by giving US manufacturers a market advantage against companies like BMW. Bush supporters could argue that it wasn't Bush monetary policies that keeps the dollar devalued, if they had Federal Reserve "M3" figures to prove that Bush wasn't flooding the market by printing massive amounts of dollars. The M3 in this case is not a hot car, but the US Gov't measure of the number of US dollars being put into circulation. Thus the only reliable indicator of the impact of Bush's printing policy on the value of the dollar. This information could absolve Bush's money printing policies from being blamed for the continued devaluation of the dollar if the M3 figures showed Bush wasn't overprinting dollars. But George Bush ordered the Federal Reserve Bank to stop publishing the M3 numbers. Let me restate that so the impact can really sink in. Bush is hiding the M3 numbers from the public, which results in the public not having any way of knowing how many US dollars Bush is printing. The M3 data is still collected. The Federal Reserve Bank, the Treasury Dept, and Bush still know the numbers. They are just hiding the M3 data from the public now. So Bush supporters are out of luck when it comes to defending the affect of the Bush administration's money printing policies. Bush effectively ripped the rug out from under you. Unfortunately this also means that folks who want to prove Bush's money printing policies are damaging the dollar don't have any data to back them up anymore either. But this works in Bush's favor because it makes all of his critics sound like conspiracy theorists without any data to back them up: http://www.oss.net/extra/news/?modul...icle_sent=true The first task for anyone who wants to defend Bush's role in the valuation of the dollar, would be to explain why Bush is keeping the M3 data secret. The second task would be to reproduce the M3 data to prove Bush's policies weren't putting too many USD notes into circulation. Anything short of this is just lip flapping and cheerleading for Bush. The side affect of all this has been that BMW's have become more expensive, and so has gas. Oil is being traded in a devalued dollar, effectively making oil more expensive because the dollar is worth less. But Europe hasn't seen the same percentage increase in gas prices because they are buying oil using devalued USD to buy oil for less Pounds and Euros compared to us here in America. http://www.stwr.net/content/view/532/37/ If you love to drive BMW's with hot engines without spending tons of money to buy the car and to keep the tank full, Bush is actively working against you. |
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08-15-2007, 09:22 AM | #21 | |
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What I'm left wondering is: What IS the "right" thing for the president - any president - to do with regard to this situation? If the president pushes a strong dollar, thereby making BMWs more affordable to all of us here on this board, the Big 2.8's UAW employees are going to scream bloody murder and claim that the government is not doing enough to "protect their jobs". Now, I personally think that that's a problem that the domestic auto makers need to solve on their own by designing, building and supporting products that can compete in the free market - WITHOUT government intervention in economic policies artificially propping their companies up. But it is easy for me to take that stance. Not so easy for the president of the United States, who has a constituency made up of the entire nation, to take that stance. If our next president is a Democrat, you can bet that the current policy of a weak dollar will be continued in order to protect all of those UAW employees who donate money to Democrat candidates. |
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08-15-2007, 10:26 AM | #22 | |
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Now, I am not necessarily saying that you are wrong about the dollar and the economy. The end result, as of now, for the US buyer is higher priced European goods. But then again, you also hear so many people complaining about how many jobs are being sent to other countries, and how many goods are being produced in China (though, the news lately certainly helped China.... [/sarcasm]). There is no question that lowering the value of the dollar would help to adjust the trade defecit. The only problem is that it is very difficult to have it both ways (strong dollar and trade defecit). There was a quote that I heard a long time ago that accurately explains this, "All economic news is bad news." Now, if that makes you want to take the tar and feathers to Bush, be my guest. But personally, Im not going to criticize the guy for effectively targeting a problem.
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