Re: BMW Canada response to CD-ROM price e-mail...

["Aaron Bohnen" <bohnen@xxxxxxxxxxxxxxxx>]

Hi everyone,

Edward writes:
 
> I thought my fellow Canadians would be interested in BMW Canada's response
> to my e-mail regarding the $130 Cdn cost of the Mobile Tradition CD-ROM.

Definitely. 
 
> >Hello! Unfortunately, a simple calculation of the exchange rate is not how
> >prices for most Canadian goods are derived.  Factors such as much higher
> >distribution costs(fuel, warehousing, tolls, distance between towns,
> >trucking taxes and licenses)

Not when the parts are flown in from Germany (see more on this below...)

> , dual translation costs in most cases for
> >Canada (sometimes not even the product itself, but the advertising
> >pamphlets, order brochures, instructions, proof-reading, adhering to legal
> >requirements),

This is expensive? One French translator for the Canadian documentation? 
Presumably BMW sells cars in France - maybe they already have the 
personnel. I don't buy this one for a second.

> > the German mark exchange rate, and the potential of sale in a
> >market of only 30 million consumers with considerably less per capita
> >disposable income than in the US, all lead to higher prices up here, for
> >everything.

I wonder why we have this less disposable income? Aside from our high taxes 
which pay for our glorious socialized healthcare, inexpensive postsecondary 
education system, etc, could it be because people like BMW Canada are 
fleecing us at every opportunity?

> >Some Canadians have found ways around the pricing situation by
> >buying directly from the USA, and all that does is drive the price up here
> >even higher, because that sale counts in the USA's figures, making their
> >market appear even more monumental than it already is.

Now I don't buy that either. Of course I'll buy from the states - anything 
that I can't get from an OEM parts supplier. How else can you afford to own 
one of these cars and not go under from parts costs? They way most 
enthusiasts handle this is to do what is obvious - buy from local OEM 
suppliers. These OEM parts suppliers are able to offer prices at or below 
BMW prices every time, and sometimes at less than two thirds or even half 
the prices. If they can do it, why can't BMW Canada?

> >Unfortunately, it is
> >a dilemma for which there is not a feasible solution, other than for
> >companies up here to charge less and absorb the loss, and there would be a
> >few shareholders who might not like that idea.  Thanks for writing.  

Companies up here to "absorb the loss"? What's that nonsense? Look back at 
that cat converter for my car. For sure the dealer and BMW Canada both made 
a VERY tidy profit from that transaction. The little harness pins for $1.38 
each? Don't tell me that BMW Canada isn't laughing up their sleeve every 
time someone buys one of those. And the Mobile Traditions CD-ROM... There 
is NO way that BMW Canada is experiencing twice the costs to get one of 
these here to Vancouver, B.C. than to get one to Seattle, Washington.

I don't buy it, not at all. But what if I'm wrong and they're right? The 
answer - share parts distribution between the US and Canada. Keep BMW 
Canada as the channel for new cars, parts as necessary, etc. but also allow 
cross-border shipping of parts from BMW USA's warehousing. We have trade 
agreements that make this possible for many companies. The prices to 
Canadian customers would fall dramatically, even if the parts were still 
purchased through your local dealer.

You see, I don't think the dealers are marking up the parts prices any more 
than our neighbours to the south. It's BMW AG that has convinced itself 
(primarily through good-sounding but empty rhetoric) that they are 
experiencing all of this hardship distributing parts in Canada. 

Let's give it a rest, shall we? Why don't Mer***es-Benz, Volkswagen, Audi, 
Porsche, etc. all sing the same sad song about their Canadian distribution 
branches? Because these dramatically higher costs just aren't real. BMW 
Canada is making lots of money and they like it that way.

Sharing all of our misery,

Aaron
___________________________________________________________
Aaron Bohnen                     email: bohnen@domain.elided
- -Ph.D. Student, Civil Engineering Department, U.B.C.
- -Technicraft Engineering Services

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