BMW Sales Decline Slows

• Posted by ToddSullivan
• on July 7th, 2009

Watch the video. This goes directly to the strategy at AutoNation (AN). The luxury auto market was dragged into the recession and will lead the auto market out. The length of time sales spend in it will be dwarfed by domestic and non-premium imports.

Just yesterday we talked about AutoNation’s Mercedes push. When I first spoke with CEO Mike Jackson last year, before credit market imploded he was stressing his desire to move the company away from domestic and into imports with a special emphasis on premium brands.

He stated then that the premium market, while not immune, was less markedly less affect by the business cycle, offered better margins and had longer service revenues
as those drivers tended to place a priority on keeping those vehicles running at a higher level. Currently AutoNation has 10% of Mercedes and 4.5%-5% of BMW US markets.

In June most domestic foreign makers saw sales fall 20% to 30%. Ford (F) was the lone bright spot with an 11% decline. But again, this is against already eviscerated sales as a starting point.

Now the usual disclaimer comes into play here. It is only a months worth of data and we need to see more for it to then become a trend. BUT, after what has happened to the auto market the last 8 months, good news of any sort is very welcome indeed.

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