Faulty Logic Regarding 135i Pricing

[atr_hugo]

Originally Posted by Road Runner

Maybe in some crazy scheme to make money, BMW is targetting all those young professionals in their 20s and 30s who are quickly filling the void left by retiring baby boomers. And maybe, just maybe, they plan on selling the 1-series at a REASONABLE premium over VWs and Hondas so that someone who was looking at a well optioned GTI, WRX, or Accord Coupe can fulfill their dreams and buy a BMW instead.

Tom Purves, BMW NA President, has said as much. And if you hook the youngsters now - you may have them for life and be able to shape their buying with products designed to meet their needs as their incomes and families grow.

You also bring up a good point when you say that there will be a reasonable premium charged over competing brands (heavy emphasis on reasonable ; -). That's one way of protecting the brand cachet.

As far as pricing is concerned, an argument can be made that the 128i will be much more price sensitive than the 135i. The enthusiasts know that the performance level of the 135i compares favorably with much more expensive vehicles and would probably be more inclined to purchase it based on performance per dollar. The 135i will be an absolute steal if it can be decently equipped and delivered at under $40K.

[Road Runner]

Originally Posted by djminkin

History has proven it. Year over year BMW wins awards for their new motors and technology. They are one of the few motor companies, not to fall in financial troubles like so many others.
I think its clear that BMW primarily competes with Mercedes, Porsche and Lexus, with their entry level models competing with Infiniti, more so than Mitsubishi or Honda.

You're right that they compete primarily with Benz, Porsche, Lexus and Infiniti. But BMW sees opportunity in that these manufacturers are ignoring part of the market that can afford their vehicles, but don't necessarily want a G35 Sedan or want to shell out for a new C300 when they come with a bit of an older image.

Entry level luxury vehicles fill the gap between the Hondas and VWs of the world and the BMWs and Infiniti's of the world. But you can't deny that makers like VW and Nissan have been producing nicer, better equipped cars than before. As they do that they can threaten to take market share from you unless you respond. Like I said before, not everyone wants the price or older image of some of the established luxury lines. But if someone else serves up a hot coupe with plenty of affordable power like the upcoming VW Coupe or Scirocco, or Altima Coupe (which bares an amazing resemblance to the G37, mostly because it is a G37), you could get screwed by ignoring the new competition.

You cannot be so concerned with who is beside you that you forget to look at who is coming up from behind you.

[Road Runner]

Originally Posted by atr_hugo

Tom Purves, BMW NA President, has said as much. And if you hook the youngsters now - you may have them for life and be able to shape their buying with products designed to meet their needs as their incomes and families grow.

You also bring up a good point when you say that there will be a reasonable premium charged over competing brands (heavy emphasis on reasonable ; -). That's one way of protecting the brand cachet.

As far as pricing is concerned, an argument can be made that the 128i will be much more price sensitive than the 135i. The enthusiasts know that the performance level of the 135i compares favorably with much more expensive vehicles and would probably be more inclined to purchase it based on performance per dollar. The 135i will be an absolute steal if it can be decently equipped and delivered at under $40K.

I agree, not knowing any pricing details, it'll be interesting to see what the 128 comes in at and what the disparity between that and the 135 is given the 135's performance. Again, wait and see I guess. I hope, and can reasonably see the base in that $34-$37k + options and delivery range.

Okay I've got to get off of here.

[gbent]

Originally Posted by djminkin

I dont think BMW is in anway concerned with competing with Mitsu, Honda, or VW, they simply are a class above.

I think the more accurate statement would be that you don't in anyway have any idea what BMW is concerned about!

[TESLAASTRO]

Originally Posted by Road Runner

Altima Coupe (which bares an amazing resemblance to the G37, mostly because it is a G37)

uh, no......

[Garrett]

Originally Posted by Mr. E

Clearly you have never driven an Evo or STi. They handle and run a track just as good if not better than any BMW I have driven, especially the Evo. You might want to check out the new Road and Track where the new Evo X just ran a lap at Laguna in record time for a non supercar. Only car with a better time ever on that course was a Porsche 911 turbo.

If the 135i is priced around $40k, BMW completely defeats the purpose of an "entry" level car as a 328 would be cheaper. The Evo is a proven winner for steering, handling, cornering, braking etc..for over 10 years and they just made it better. The 135i hasnt proved jack shit yet so BMW shouldnt go pricing it out of the market is all I am saying.

I wasn't talking about how great the EVo drives... and yes, I have flagged the living f*ck out of several. But that in no way takes away from my statement..!

I was saying that they are not even in the same market segment. The only reason you are compairing the 135i to the evo is because it's nearly the same price...!

Did you not read that..? It a friggin moster of a car, but it is still a Mitsubishi.


I guess you don't understand how BMW names their cars.

A 328i is not going to have the performance of a 135i. It doesn't matter that it's a 1 series vs 3 series. The 3 series offer more opulence and luxury over the 1 series, just like the 5 series offers more room, more opulence and more luxury over the 3 series.

Though, within each series there are performance levels indicated by the last 2 numbers. 325i, 328i, 330i 335i ....etc

The 128i is not going to be $40k either, but max out fully loaded at about $30k ~ $32k. In basic trim the 128i will be about $27,400. The 135i will start at about $35k ~ $36k.

Tell us again how you think the BMW 135i sport luxury coupe is in the same market as a 4-door, 2.0l turbocharged AWD rally car..?

Again, I've said the only reason people are making the comparo is becuase the 135i offer blistering acceleration, but it a sport luxury coupe, the EVO is not!






-Garrett

[Garrett]

Originally Posted by Road Runner

Mitsu, Honda, VW, all build cars. BMW builds cars. If a BMW is too expensive or the value isn't there, you can buy a VW, a Mitsu, a Honda, whatever. You may not get the same performance, but you are also paying less money.

I find it pretty frustrating when fanboys come along and say "Well BMW doesn't compete with Japanese cars, or VW" or whatever. At the end of the day, they do, maybe not for everyone, but they do. Someone can come along and say, "cool, the 1-series has a lot of horsepower, oh but for $10 grand less I can go buy this japanese car that has only 40 hp less, why don't I do that, aren't they known for their quality too?"

Enthusiasts (most if not everyone on here), are generally a very informed group that is often pretty focused on only a couple of products which meet their wants and needs. We enthusiast's however, represent a fairly small % of the population. So even though BMW is clearly targeting enthusiasts with the 1, they would be remiss if they didn't make sure that the car was priced so that new buyers beyond enthusiasts would be interested in purchasing the car.

At the end of the day, BMW's mission is not to have to have the best brand image. Their mission is to increase profits and produce shareholder value, their well maintained brand image is just a part of their strategy to increasing shareholder value by selling cars. You don't increase profits and shareholder value by voluntarily limiting the production runs of your car and hiking the price of the vehicle to the point where you erode your value proposition to everyone but enthusiasts. And you ABSOLUTELY DO NOT increase shareholder value by saying "We are not in anyway concerned with competing with Mitsu, Honda, or VW, we simply are a class above." Can you imagine a CEO going to the Board and saying, "yeah we're not too concerned with what the rest of the market does, we're too good for them and people who buy Hondas or VWs aren't really interested in BMWs anyways. I think we're fine not expanding our market."

The fact of the matter is that every car, with the exception of maybe the Mazda Miata, gets bigger with age. As the cars get bigger and have more features, they get more expensive. When this happens, eventually you need to introduce a newer, smaller car, that will fit into the price gap you're older car used to inherit. Is everyone interested in bigger cars? NO. Are younger people interested in bigger cars, often NO, especially when they cost more. The 3 series is a bigger car than it used to be, enter the 1 series. Why are younger people so important then?

European and North American demographics are shifting. The baby-boomers are getting older and though they still have a lot of disposable income, guess who will have more soon??? Their kids, many of whom are now in their 20s, some in their 30s. Maybe in some crazy scheme to make money, BMW is targetting all those young professionals in their 20s and 30s who are quickly filling the void left by retiring baby boomers. And maybe, just maybe, they plan on selling the 1-series at a REASONABLE premium over VWs and Hondas so that someone who was looking at a well optioned GTI, WRX, or Accord Coupe can fulfill their dreams and buy a BMW instead.

Oh, but wait, BMW isn't concerned with what Honda, VW, and all those other manufacturers are doing.

Nevermind.

Exactly, BMW is a leader in the automotive market. Mitsubishi doesn't race in Formula1, nore build super smooth, highly effecient engines based on this technology. BMW moves forward at a vanguard's pace. BMW doesn't look back, their to engossed in their passion of cars. Through hard work the lead the industry.

Thats why Manufactueres compares their cars to BMW's.

Does the 335i compete with the Mitsu EVO..? No! Then for $10k less, why would the 135i..? Because it the same price..? They are not direct competetors, though it's interesting to see how many people here say if the BMW 135i is prices to high they will just buy the EVO.

WTF is that..?






-Garrett

[kurichan]

Originally Posted by MPower

Diminishing returns applies to anything and everything; that is what makes it the law of diminishing returns.

Yes, but diminishment of returns (more accurately, maximization of economies of scale) only occurs past a certain point that this car won't reach.

To put it into context, did VW experience diminishing returns on reducing the production cost of the Beetle through increasingly large volume production?

I think not.

[kurichan]

Originally Posted by Mr. E

Whats so funny?

Garrett reacts strangely and makes bizarre, unfounded, uncredible fanboi statements all the time. I suggest getting used to it or just ignoring it. It isn't getting better, and it isn't going away. It takes all types I guess...

[imported_MPower]

Originally Posted by kurichan

Yes, but diminishment of returns (more accurately, maximization of economies of scale) only occurs past a certain point that this car won't reach.

As I mentioned in a later post, that is probably so... but the law still does apply whether BMW operates at the point or not.

Originally Posted by kurichan

Garrett reacts strangely and makes bizarre, unfounded, uncredible fanboi statements all the time. I suggest getting used to it or just ignoring it. It isn't getting better, and it isn't going away. It takes all types I guess...

[Garrett]

Originally Posted by kurichan

Garrett reacts strangely and makes bizarre, unfounded, uncredible fanboi statements all the time. I suggest getting used to it or just ignoring it. It isn't getting better, and it isn't going away. It takes all types I guess...

It was funny because he didn't know and is now learning. I could've called him a n00b or ignorant, instead I tried to give him something to ponder or consider.

I'm on the Porsche mb as much as I am here... because I love cars and I learn all the time from the different communities. But I guess you take knowledge as fanboi'ism.

To each his own... at least i don't have compulsion to go around and try character assasinating people who can hold a logical debate with me.






-Garrett

[Road Runner]

Originally Posted by TESLAASTRO

uh, no......

It was a bit of an exageration, they aren't the same car, but its hard to deny that their similarities are more than skin deep. Seems like the Altima is definetly channeling the G37.

[Idealistic]

Originally Posted by Garrett

Does the 335i compete with the Mitsu EVO..? No! Then for $10k less, why would the 135i..? Because it the same price..? They are not direct competetors, though it's interesting to see how many people here say if the BMW 135i is prices to high they will just buy the EVO.

WTF is that..?

At the beginning of the paragraph you say that 335i doesn't compete with the Evo, I'm not sure how this applies to anything since it is the 135-Evo comparison we are making here. The 335i base is over 10 k more than the current evo. Of course they don't compete, they are in totally different classes.

That's where the 135i enters. Are you really telling me that two mid 30k compact cars, each with ~300 hp turbo engines and great handling, both meant to be a diver/enthusiast car, aren't going to be competing? You even said at the end of your statment you had seen people say if it turns out the 135i is too expensive they will buy an Evo.... That would imply that, to stay competitive in the market, BMW will have to bring a lot more to the table in the form of performance, features, or some other aspect, or they risk losing potential 135i buyers to the Evo.

Believe it or not, only fanbois and badge humpers would pay 3000+ more for a car just because it has the little blue and white badge on it. There certainly not a shortage of those kinds of people when it comes to BMW, but it is definitely not a large enough group to stake the sales of an entire line of cars on.

See what I'm getting at?

[ibeam81]

Originally Posted by Road Runner

It was a bit of an exageration, they aren't the same car, but its hard to deny that their similarities are more than skin deep. Seems like the Altima is definetly channeling the G37.

+1. I thought the same thing when I first saw the new Altima coupe. Obviously they are very different cars under the surface, but IMHO Nissan borrowed a little much in the looks department. And considering that a well optioned V6 Altima coupe is in the low 30s, I think that Nissan missed the boat with pricing as well. :iono:

[BForbes]

Garretts got many good points. The only reason I'm cross-shopping the Evo X and the 135i is because of the blistering acceleration. I dont see them in the same market. The Evo and STI are kings of the boy-racer market. The 135i is a luxo-performance coupe. END of STORY.

[djminkin]

Originally Posted by Road Runner

Mitsu, Honda, VW, all build cars. BMW builds cars. If a BMW is too expensive or the value isn't there, you can buy a VW, a Mitsu, a Honda, whatever. You may not get the same performance, but you are also paying less money.

I find it pretty frustrating when fanboys come along and say "Well BMW doesn't compete with Japanese cars, or VW" or whatever. At the end of the day, they do, maybe not for everyone, but they do. Someone can come along and say, "cool, the 1-series has a lot of horsepower, oh but for $10 grand less I can go buy this japanese car that has only 40 hp less, why don't I do that, aren't they known for their quality too?"

Enthusiasts (most if not everyone on here), are generally a very informed group that is often pretty focused on only a couple of products which meet their wants and needs. We enthusiast's however, represent a fairly small % of the population. So even though BMW is clearly targeting enthusiasts with the 1, they would be remiss if they didn't make sure that the car was priced so that new buyers beyond enthusiasts would be interested in purchasing the car.

At the end of the day, BMW's mission is not to have to have the best brand image. Their mission is to increase profits and produce shareholder value, their well maintained brand image is just a part of their strategy to increasing shareholder value by selling cars. You don't increase profits and shareholder value by voluntarily limiting the production runs of your car and hiking the price of the vehicle to the point where you erode your value proposition to everyone but enthusiasts. And you ABSOLUTELY DO NOT increase shareholder value by saying "We are not in anyway concerned with competing with Mitsu, Honda, or VW, we simply are a class above." Can you imagine a CEO going to the Board and saying, "yeah we're not too concerned with what the rest of the market does, we're too good for them and people who buy Hondas or VWs aren't really interested in BMWs anyways. I think we're fine not expanding our market."

The fact of the matter is that every car, with the exception of maybe the Mazda Miata, gets bigger with age. As the cars get bigger and have more features, they get more expensive. When this happens, eventually you need to introduce a newer, smaller car, that will fit into the price gap you're older car used to inherit. Is everyone interested in bigger cars? NO. Are younger people interested in bigger cars, often NO, especially when they cost more. The 3 series is a bigger car than it used to be, enter the 1 series. Why are younger people so important then?

European and North American demographics are shifting. The baby-boomers are getting older and though they still have a lot of disposable income, guess who will have more soon??? Their kids, many of whom are now in their 20s, some in their 30s. Maybe in some crazy scheme to make money, BMW is targetting all those young professionals in their 20s and 30s who are quickly filling the void left by retiring baby boomers. And maybe, just maybe, they plan on selling the 1-series at a REASONABLE premium over VWs and Hondas so that someone who was looking at a well optioned GTI, WRX, or Accord Coupe can fulfill their dreams and buy a BMW instead.

Oh, but wait, BMW isn't concerned with what Honda, VW, and all those other manufacturers are doing.

Nevermind.

Why does everyone compare cars based on power and which car is faster than the other? There is a very large percentage of people who dont really care which car is faster or has more power. You are being narrow minded basing everything on that. Maybe its because were discussing it on a performance car message board, but many people and this is usually the case, establish a price bracket they want to be in and go and drive the cars for the overall driving experience. Comfort, accessories, safety, performance, braking, gas mileage, scheduled matainaence, are all equally important to the average car buyer. BMW in my opinion offers a total package, that is unparalled even in the higher price bracket by Mercedes and Porsche, let alone Honda and Mitsubishi. What I meant by not being concerned, is that I feel BMW is aiming at a higher class of buyer, with Porsche pricing themselves out of the realm of reality on some vehicles, and Mercedes, not offering the same type of total driving experience BMW does. When you compare what BMW has to offer in its price class to its main competitors, its highly favorable. The 1 series, is meant to lure the young professional up the next step of automobile that may be driving a Mistu or Honda, but the decision will not only be based on HP or which car goes 0-60 faster, that is a very immature view point, one that might be valid in the sub 20 age bracket, and this is where I think BMW is not as interested to compete in, because they simply cant build a car up to their standards to compete at that price point.

[BForbes]

Originally Posted by djminkin

Why does everyone compare cars based on power and which car is faster than the other? There is a very large percentage of people who dont really care which car is faster or has more power. You are being narrow minded basing everything on that. Maybe its because were discussing it on a performance car message board, but many people and this is usually the case, establish a price bracket they want to be in and go and drive the cars for the overall driving experience. Comfort, accessories, safety, performance, braking, gas mileage, scheduled matainaence, are all equally important to the average car buyer. BMW in my opinion offers a total package, that is unparalled even in the higher price bracket by Mercedes and Porsche, let alone Honda and Mitsubishi. What I meant by not being concerned, is that I feel BMW is aiming at a higher class of buyer, with Porsche pricing themselves out of the realm of reality on some vehicles, and Mercedes, not offering the same type of total driving experience BMW does. When you compare what BMW has to offer in its price class to its main competitors, its highly favorable. The 1 series, is meant to lure the young professional up the next step of automobile that may be driving a Mistu or Honda, but the decision will not only be based on HP or which car goes 0-60 faster, that is a very immature view point, one that might be valid in the sub 20 age bracket, and this is where I think BMW is not as interested to compete in, because they simply cant build a car up to their standards to compete at that price point.

Well damn I guess I'm immature then. The reason I love BMW is because I believe they have the perfect balance of performance and luxury. I also told myself that my next vehicle will be have to be FASTER and have more room. As a young professional acceleration is very important to me as well as the other creature comforts. If people dont care about moore oomph then there would be no reason to buy a 335i over a 328i. Then why are their 3 different versions of the 5 series(not including the M5). Sure the bigger motor models have a few more toys but not enough to justify the price premium.

[Idealistic]

Originally Posted by onehots2k

Garretts got many good points. The only reason I'm cross-shopping the Evo X and the 135i is because of the blistering acceleration. I dont see them in the same market. The Evo and STI are kings of the boy-racer market. The 135i is a luxo-performance coupe. END of STORY.

He does have good points and I definitely think there is an argument that they aren't in the same market per se, but as you said yourself, you are considering both cars. You will assign a value to each of the attributes you perceive each car to have, and you will pick the car that scores highest. You might test drive each one and compare how each one rides and feels. They will compete and will be compared to each other no matter what. If the BMW doesn't stack up for whatever reason, price being one of the larger factors in this specific comparison, the BMW will have lost a market they otherwise could have infiltrated.

The STI and the Evo are the kings of the boy racer market, and if the 135i didn't exists I would almost certainly be buying an Evo X next year. The fact that the 135i is around allows me to be a boy racer when I want to be
but be a young professional the rest of the time. Plus its easier to get out of tickets.

[imported_MPower]

Originally Posted by djminkin

Why does everyone compare cars based on power and which car is faster than the other? There is a very large percentage of people who dont really care which car is faster or has more power. You are being narrow minded basing everything on that.

Let me get this straight: you original claim that the 135i should be priced above the 335i only based on performance and now you are saying that everyone else is being narrow minded?

[Idealistic]

Originally Posted by djminkin

Why does everyone compare cars based on power and which car is faster than the other? There is a very large percentage of people who dont really care which car is faster or has more power. You are being narrow minded basing everything on that. Maybe its because were discussing it on a performance car message board, but many people and this is usually the case, establish a price bracket they want to be in and go and drive the cars for the overall driving experience. Comfort, accessories, safety, performance, braking, gas mileage, scheduled matainaence, are all equally important to the average car buyer. BMW in my opinion offers a total package, that is unparalled even in the higher price bracket by Mercedes and Porsche, let alone Honda and Mitsubishi. What I meant by not being concerned, is that I feel BMW is aiming at a higher class of buyer, with Porsche pricing themselves out of the realm of reality on some vehicles, and Mercedes, not offering the same type of total driving experience BMW does. When you compare what BMW has to offer in its price class to its main competitors, its highly favorable. The 1 series, is meant to lure the young professional up the next step of automobile that may be driving a Mistu or Honda, but the decision will not only be based on HP or which car goes 0-60 faster, that is a very immature view point, one that might be valid in the sub 20 age bracket, and this is where I think BMW is not as interested to compete in, because they simply cant build a car up to their standards to compete at that price point.

This thread is about the 135i exclusively. If someone wants a 1 series and isn't so concerned about speed, why would they buy a 135i when they can have the 126i for thousands less, probably even have it fully loaded for less than the 135i base. Thats not a rhetorical question btw, I really want to hear you weigh in on that.

The 1 series is definitely meant to lure young people into a bimmer and hopefully get them hooked for life. Don't force it into only that corner though. Why won't it be judged on its speed? It already has been, every car is, and how in hell is that immature?

We like fast cars, so we are immature, I guess I'll go hang in my playpen with Michael Schumacher.

[TESLAASTRO]

Originally Posted by Road Runner

It was a bit of an exageration, they aren't the same car, but its hard to deny that their similarities are more than skin deep. Seems like the Altima is definetly channeling the G37.

difference is like night and f-----g day....workmanship, interior, handling, wheels, tires, and most importantly, RWD on the G37, which is a BIG difference....The G37 however is my 2nd choice if pricing on the 135 is "out of hand"....I think the Altima coupe,3.5 is a great car for the $ at like 27k with leather....But, the dinky donut tires and wheels would be a minimum of 2k for a decent upgrade...they look spectacularly horrible on the car, with way too much space in the wheel wells(look, you can hide someone in there)....this is a car I would recommend for college students as a better alternative to accord or camry, or a young professional......

[djminkin]

Originally Posted by MPower

Let me get this straight: you original claim that the 135i should be priced above the 335i only based on performance and now you are saying that everyone else is being narrow minded?

That wasnt me that said that. I was told the car will be around 3K cheaper than the 335. Im hoping its more like 5 or 6 cheaper.