Do people actually purchase new BMW's?

[JOD]

Originally Posted by PimTac
Like a normal buyer he should test drive both and compare but it sounds like he has made his choice already.

Good luck with that.


?

The person in question has driven and researched every vehicle in this category (and some out of it), and landed on the X1. Not sure how how your comment has any relevance.

The question is really new vs. used--and why on earth someone would by a new one vs. a slightly used off-lease one. After reading some of the responses though, it's pretty clear that BMW's business model seems predicated upon a lot of leases.

 

[CKN]

Originally Posted by MCompact
Originally Posted by 02SE

Work hard, and maybe you too can have jealous people hoping you live in mom's basement...


Precisely!


I basically said the same thing and my post was deleted.........

 

[Wolf359]

Originally Posted by 02SE
Originally Posted by Snagglefoot

So, when you see a new BMW "owner"with his new wheels, there is a very good chance he lives in his mom's basement.


Work hard, and maybe you too can have jealous people hoping you live in mom's basement...


Yeah leasing is much harder than regular financing. You can qualify for financing where you won't qualify for leasing. Average income of BMW owners is 125k. Basically it's the top 10% that end up buying them. Lots of sour grapes here on BITOG.

https://hedgescompany.com/blog/2019/03/new-bmw-owner-demographics/

Originally Posted by geeman789
I just checked the BMW residual value for a 2020 X5 ... 40% of MSRP for a 4 year lease.

Seems BMW knows the resale value of a current BMW sucks too.


The thing that people don't get about leasing is that the residual is based on MSRP. A typical 3 year lease is more like a 50-55% residual. But you start with MSRP and discount from that point on. Normally you can probably get at least 7-8% off but during extreme discounting, you can get anywhere from 10-15% off MSRP. So on a 3 year lease with 15% off and a 50% residual, you're only paying 35% of MSRP over 3 years. You get to that 15% off MSRP by using various incentives and discounts.

 

[Ws6]

Originally Posted by CKN
Originally Posted by MCompact
Originally Posted by 02SE

Work hard, and maybe you too can have jealous people hoping you live in mom's basement...


Precisely!


I basically said the same thing and my post was deleted.........

You have to say things a certain way. We live in a society...

 

[Ws6]

Originally Posted by Wolf359
Originally Posted by 02SE
Originally Posted by Snagglefoot

So, when you see a new BMW "owner"with his new wheels, there is a very good chance he lives in his mom's basement.


Work hard, and maybe you too can have jealous people hoping you live in mom's basement...


Yeah leasing is much harder than regular financing. You can qualify for financing where you won't qualify for leasing. Average income of BMW owners is 125k. Basically it's the top 10% that end up buying them. Lots of sour grapes here on BITOG.

https://hedgescompany.com/blog/2019/03/new-bmw-owner-demographics/

Originally Posted by geeman789
I just checked the BMW residual value for a 2020 X5 ... 40% of MSRP for a 4 year lease.

Seems BMW knows the resale value of a current BMW sucks too.


The thing that people don't get about leasing is that the residual is based on MSRP. A typical 3 year lease is more like a 50-55% residual. But you start with MSRP and discount from that point on. Normally you can probably get at least 7-8% off but during extreme discounting, you can get anywhere from 10-15% off MSRP. So on a 3 year lease with 15% off and a 50% residual, you're only paying 35% of MSRP over 3 years. You get to that 15% off MSRP by using various incentives and discounts.

That's pretty low. I'd expect 60% or so.

 

[02SE]

Originally Posted by CKN
Originally Posted by MCompact
Originally Posted by 02SE

Work hard, and maybe you too can have jealous people hoping you live in mom's basement...


Precisely!


I basically said the same thing and my post was deleted.........



If it's the post I think you're referring to, It's still on the first page...

 

[Lapham3]

My dad was a car guy and sold them for some years after WW2. I know a few myself, and they will generally say that Euro and certain US brand cars are often bought for 'status'. A fair number can afford them, but many are bought used or leased by folks that really have high debt to asset ratios. My wife has a cousin who goes by='to be successful, you must look successful'. You'd think that from 'appearances' that he's a wealthy guy-but not the case and there's stress with all that.

 

[MCompact]

Originally Posted by 4WD
Work with folks that buy the first one … then start leasing number two on … they wind up loving the drive and image … but not the PM or outrageous repair costs …


I know, that's why I only keep mine for 5-25 years.

 

[RamFan]

Originally Posted by MCompact
Originally Posted by 4WD
Work with folks that buy the first one … then start leasing number two on … they wind up loving the drive and image … but not the PM or outrageous repair costs …


I know, that's why I only keep mine for 5-25 years.

I love how these threads inevitably turn into a bashing (of sorts) towards the people that own Euro cars.

4WD, I don't view your comment as bashing but it adds context to the response.

 

[4WD]

Let's don't pretend having a 25 year old BMW means a new complex BMW will be economic for 25 years. I probably work around the largest group of six figure employees in the Houston area and talk cars with many of them.
Lots of them will only lease these cars … loaner in the deal.

 

[Snagglefoot]

I have some prescribed reading for anyone who thinks $125 K per year is a lot of money. The book is " The Millionaire Next Door". If you only make $125 K per year, you are making a mistake leasing expensive cars. Let's hope your Mom leaves you a lot of money.

 

[Dwight_Frye]

Regarding the leasing of BMW's and the income level of those who do so, what has not been mentioned is that many of the people who lease a BMW are getting a car allowance as part of their compensation. Most of the upper management at my previous company drove luxury cars that retailed for $70K to $150K. I was in a position to know what these perks were for the executives. The CEO got a $1400 a month car allowance. He drove a new Cayenne. Even if you only get a $300-$400 a month allowance, adding a few hundred dollars each month out of your own pocket will net you a pretty nice car on a lease basis.
I am also aware of many people under the age of 30 who leased BMW's but couldn't afford a house in a city where the median cost in a nice neighborhood was over $900K and rent for a 2 bedroom apartment that wasn't in the ghetto was $3000 a month. They liked the perceived status of a BMW and were living paycheck to paycheck anyway.

 

[Ws6]

Originally Posted by Snagglefoot
I have some prescribed reading for anyone who thinks $125 K per year is a lot of money. The book is " The Millionaire Next Door". If you only make $125 K per year, you are making a mistake leasing expensive cars. Let's hope your Mom leaves you a lot of money.

As someone who lives within spitting distance of that figure, I agree 100%. I used to would have vehemently DISagreed, but nah. It's true.

 

[jstert]

my son recently leased a slightly used, fully loaded, ex dealer demo, x3 at a great price (so he says, i was against it). in his defense he is an army officer transferring overseas this summer so he can break the lease early without penalty. he wanted to get a luxury bmw out of his system. and fwiw, he fully funds his ira, tsp (401k) and private annuity religiously.

 

[edyvw]

For "experts" here, BMW X1 does not have ZF8 transmission, unfortunately.
It is FWD platform with transverse engine, and has Aisin 8 speed transmission like every other pinnacle of automotive engineering, Toyota. Now, in this universe Aisin 8 speed is nowhere reliable as ZF8, but for purpose of this discussion, yes, BMW X1 comes with uber "reliable," dream come true, transmission made by Aisin.
Also, I would like to ask these "experts" on BMW how much more expensive parts for BMW are compared to Mazda, Toyota, VW, Honda etc? I own Toyota, BMW and VW and maintain them by myself, so I am aware of prices, and difficulty of work on each. But, would like to hear obviously something new from experts here.

 

[Mr Nice]

Originally Posted by jstert
my son recently leased a slightly used, fully loaded, ex dealer demo, x3 at a great price (so he says, i was against it). in his defense he is an army officer transferring overseas this summer so he can break the lease early without penalty. he wanted to get a luxury bmw out of his system. and fwiw, he fully funds his ira, tsp (401k) and private annuity religiously.


Both my sons had the ‘itch' for a for a BMW / Benz but I convinced them at this stage they need to focus on building their net worth and much more important things like paying off their mortgage , retirement and their kids.

Eventually they will have a BMW in the future....

 

[DaRider34]

Originally Posted by Dwight_Frye

I am also aware of many people under the age of 30 who leased BMW's but couldn't afford a house in a city where the median cost in a nice neighborhood was over $900K and rent for a 2 bedroom apartment that wasn't in the ghetto was $3000 a month. They liked the perceived status of a BMW and were living paycheck to paycheck anyway.


3000 a month could buy you a nice mansion in the south


i'm sure is easier to convince people into a 600 month lease for a 45-55k car instead of pruchase at 900-1000 a month.

 

[PimTac]

Instead of focusing on status and ego it would be wiser to purchase a vehicle that is cheaper to maintain and has higher reliability.

 

[JOD]

Originally Posted by PimTac
Instead of focusing on status and ego it would be wiser to purchase a vehicle that is cheaper to maintain and has higher reliability.



um..

wow...

I'm curious why you think status or ego has anything to do with the decision?

 

[PimTac]

Originally Posted by JOD
Originally Posted by PimTac
Instead of focusing on status and ego it would be wiser to purchase a vehicle that is cheaper to maintain and has higher reliability.



um..

wow...

I'm curious why you think status or ego has anything to do with the decision?







Why didn't the person consider other makes? Toyota, Honda, Nissan. None of these were mentioned.