German dealers have lodged a lawsuit against BMW AG, claiming that the manufacturer has cut their profit margins on the new 7-Series.
German dealers have lodged a lawsuit against BMW AG, claiming that the manufacturer has cut their profit margins on the new 7-Series.
According to , the ZDK union of German auto traders group, representing nearly all of the 800 German BMW dealers, said 14 dealerships had lodged a complaint at a court in Munich. They are accusing BMW of unfairly increasing factory prices.
BMW had reportedly changed the difference between the factory price for a 7-Series and its retail price from 13 per cent to 11 per cent, cutting the dealers’ profit margin.
The dealers, in turn, say they have negotiated with BMW to try to change the situation without much success. They fear that BMW will also reduce their margins on other new models.
Confirming that the company would defend its policy, BMW spokesman Uwe Mahla said “Our position is that we can set prices without consulting anyone. The dealers think we have to agree with them first.”
The ZDK said it was hoping the court would reverse BMW’s decision to raise its factory prices. “It is getting more expensive for the dealers to buy the cars, and the dealers make less from the cars without their (contractual) duties being reduced,” said a ZDK spokesman.
“We feel we have a sound legal position and are not concerned by the claim,” said Mahla.
