Charting the changes to owning a BMW

Interesting | March 18th, 2016 by 6
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It is pretty easy to tell when the cost of a new BMW goes up since it’s directly related to the MSRP raising or shipping …

It is pretty easy to tell when the cost of a new BMW goes up since it’s directly related to the MSRP raising or shipping charges go up. Less apparent, however, are when changes affect the back-end of ownership, the ones that affect resale and cost of maintenance. So it was with no fanfare in the Summer of 2015 that BMW of North America stated it would be doing away with its often touted free maintenance of 4-years or 50,000 miles starting with the 2017 models. Also, all the new cars sold through July 1st 2015 would keep the original free maintenance program only for the original owner.

BMW’s Free Maintenance Plans was one of the companies best selling points. Everything was covered on new BMWs – wiper blades, brake pads, rotors and scheduled service.

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This program is now being transitioned to a shorter 3 years/36,000 miles and it’s much less comprehensive for the 2017 Model Year.

For new BMWs sold July 1st 2015 on, the maintenance program became non-transferable. Meaning, any subsequent owner now pays for these routine service costs out of pocket. Prior to 2015, the free maintenance went with the BMW. It didn’t matter how many subsequent owners there were. They would enjoy those same benefits too. Given free routine maintenance, you were virtually assured a 3 or 4 year old BMW was properly maintained. Now, it will be only a matter of time before the used car market begins factoring in the new costs to subsequent owners by reflecting it in lower resale values.

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BMW was one of the first luxury car makers to come up with a Certified Pre-Owned program nearly 20 years ago. BMW dealers would select certain well maintained lease turn-ins or trade-ins to resell with an outstanding extended BMW backed warranty. This comprehensive CPO warranty covered these BMWs for another 2 years, 50,000 miles after the original 4 year/50,000 mile warranty ran out. BMW dealers would charge a $50 fee for your repair, but considering how much the repairs could be, a $50 visit to see the BMW doctor seemed reasonable. Though the CPO warranty was comprehensive, it did not extend the 4 years , 50,000 miles free service.

Owning a Certified PreOwned BMW used to mean a lot if you went to sell it as you were selling a BMW with an extended BMW dealer-backed warranty. However, since January 2014 no longer will the CPO warranty transfer to any subsequent owner if you sell it to anyone other than back to a BMW dealer. I’ve owned a Certified Pre-Owned X5 and my CPO warranty saved me when an axel boot let loose and threw grease everywhere inside the wheel. When I went to sell it, it was seen as an asset and a nice benefit that the CPO warranty would transfer to the next owner.

The dictionary defines Elite as a select part of a group that is superior to the rest. However, BMW Elite CPO program is a new subset of the BMW CPO Program that is really only half as good as a regular CPO warranty. CPO Elite is 1 year, 25,000 miles compared to the 2 years, 50,000 miles. The program also applies only to newer BMWs with less than 15,000 miles.

This is not the only BMW owner benefit that has been eroded lately. Beginning in Jan of 2016, BMW USA rolled back their incentive on doing a European Delivery from 7 percent discount off base MSRP to 5 percent. Then there is the Certified Pre-Owed Program which was drastically changed in 2014 and not in the customers favor. Yet despite all of this, there was a bit of good news – BMW Assist Emergency Call including Automatic Collision Notification was extended to 6 years / 100,000 miles.

There is no question costs of manufacturing BMWs and maintaining them go up with time. The question is, as owners, would you prefer to see these costs upfront like we used to, or see erosion of benefits on the back-end?

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