Understanding BMW sales/profits

I am still fascinated by the quoted statement from BMW in the LA Times that 50% of their profits come from the 5-Series.

Here is a chart of BMW 2009 Sales from back in January 2010:

BMW sold 40,109 5-Series vehicles, of a total of 196,502 vehicles.  For the moment let’s assume the BMW Marketeers excluded Mini sales from their figures.

Normally I would have expected the profit rate on the SUVs was very high, but BMW sold almost the same number of SUVs as 5-Series sales.  So their profit margin on the SUVs are much lower than the 5-Series?  The profit level on the 3-Series and 1-Series are lower as well?

Certainly because the price tag of the vehicles differs sharply:

3-Series: $33-45K

5-Series: $45K-$63K

SUVs: $39K-$67K

So something seems odd here, if the SUVs have the same price range as the 5-Series but are much less profitable?  It may have to do with pedestrian issues, such as the 5-Series is an older model and so has already paid off its tooling costs (a new model is on the way now).

Or it could simply have been the type of thing Marketing people say to emphasize that BMW 5-Series Buyers don’t mind spending a lot of money on accessories.

One final theory — perhaps BMW’s profits on the 5-Series and the SUV are both healthy, and their profit margin on the 1-Series and 3-Series are near 0?  That would fit the quote, and fit the pricing.  Still is worthwhile to HAVE the 1-Series and 3-Series in the mix, as they drive traffic.  But even at the high (to me) 3-Series prices and healthy sales BMW may not be making much money on them?

1 thought on “Understanding BMW sales/profits

  1. Pingback: Bmw Sales Figures History | BMW Photos Blog

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