The redesigned 5 series G30 arrived in dealers around mid-February, and 2,000 units were already pre-ordered by customers, so by the end of March, BMW only had 200 unsold sedans in dealer inventory according to Ludwig Willisch, BMW Group Region Americas.
Willisch added that the 5 series is “a scarce species” but supplies aren’t supposed to be that low. Since the end of March, production and deliveries have increased, and by now, dealers will have a two- to three-week supply during the launch.
For instance, the biggest retailer in the company would be Sonic’s 15 BMW stores - and they have a 224 units of the sedan, which should be good for 15 days, along with 15 more units of the 2016 version. So its actually the number of customers coming in thats making it seem like supplies are low. Sonic expects more supplies to come their way in May.
Chairman of the BMW National Dealer Forum, Tim Kraemer is aware of this issue. However, he wants to ensure that even if production will be increased, the company should not oversupply as this will be a bigger problem. There should still be balance between production and sales, because they don’t want to reach the point wherein prices have to drop just for the cars to sell.
In January, the 2016 BMW 5 series had to increase it’s incentives to an average of $11,005. As old units were cleared out in February, the incentives decreased, and by March, it had an average of $6,284. Dealers still have the previous generation stocked in their lots, but nationwide supply was down to about 100 vehicles by late April. This is precisely what Kraemer wants to avoid for the 2017 series 5.
Sales for the 5 series have been going downhill since its peak in 2013, at 56,863 units sold. Last year, BMW sold a total of 32,408, thats down by 27 percent from 2015. This year, the company has sold 6,641 units of the 5 series by March, down 32 percent though the sell-down period.
Sonic’s Dyke is working of the marketing side, and when more cars arrive by May, marketing activity should spike. Trudy Hardy, VP of marketing for BMW, says that they are spending 20 percent more that the usual for a launch on the 2017 5 series. With focus on digital and data-based marketing as opposed to the old-school broadcast. Though TV advertising began in March and will be strong through the season.