To combat the downfalls of COVID-19, BMW of North America releases a sweeping relief package to help its U.S. dealerships. The plan aims to preserve liquidity and prop up the balance sheet. The coronavirus has had a devastating impact on the automotive industry with factories being shutdown and empty showrooms.
The package includes financial incentives, relaxed performance objectives and loan payment relief.
The challenge facing the auto industry is “unprecedented,” CEO Bernhard Kuhnt told dealers in a note late Thursday evening obtained by Automotive News.
“Safeguarding our business and the … retail network, while helping to ensure that you have the necessary support and working capital to navigate this uncertainty, is our primary focus,” Kuhnt said.
The BMW Relief Package
For March, dealers will receive a $1,000 payout on every new vehicle sold and a $500 bonus for every loaner retailed. The CPO sales bonus is also guaranteed for this month.
Through June 20, retailers will receive the 5 percent Added Value Program bonus related to meeting training, sales loyalty and service effectiveness goals.
Dealer payments, including principal and interest, on floorplans, capital loans, mortgages and other commercial borrowing will be deferred for 90 days, if requested by the dealer.
Financial Relief For Customers.
The BMW Financial Services will defer customer loan payments until June 30. Customers whose leases are due will be offered a complimentary 30-day lease extension until April 30.
BMW says that the relief package aims to secure operational stability so dealerships can continue to deliver sales and service.
“We are concentrating on supporting the … network’s concerns over dealer cash flow, customer interaction and business enabling,” the CEO said.