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      12-29-2019, 11:26 PM   #23
apue
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Originally Posted by M3e9x_Aust View Post
Congratulations apue

May I ask if your new baby is a manual or an automatic?
It's automatic.
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      12-29-2019, 11:35 PM   #24
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Originally Posted by BMWF87Melb View Post
Hi there - I'm actually looking to move from a mk7 golf r to an M2. Just curious how come for the short ownership of your golf r? Didn't enjoy it?

The golf r has been good to me - but I miss driving manual and the exhaust note of the golf is pretty boring. Read that the akrapovic exhaust on the special edition mk 7.5s does improve things.
Nothing wrong with my golf R 7.5.
It has dynaudio so I was happy with car.
But the sound note is utterly crap compared to M140i, RS3 and M2.

I often maxed out the power 213Kw when I accelerating, and it's not powerful enough.
I was also considering the ecu tuning and upgrading the downpipe.
But I decided to spend more money to get a right car.

To be honest, I was a bit scared to mod the car whether the insurance may refuse the insurance claim *if* I had an accident causing a large amount of money.

Last edited by apue; 12-29-2019 at 11:53 PM..
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      12-29-2019, 11:51 PM   #25
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Originally Posted by ///Driver View Post
I understand... maybe your dealer’s parent company also owns a VW dealership.

Sounds like your dealer had to get creative with the car pricing to make the deal happen.

Indeed! Everything about the car sales is case-by-case.
Hi ///Drive.
I just wish to update more info on the pricing.
My work colleague showed his interest in my golf R, so I called the dealer to say "I wish to keep my golf R, so how much do I pay for the M2 only?".
They came back to me to ask to pay $94k.
Apparently it's not their interest to hold another car in their stock given that the market is shrinking. Thus I believe it is the rock bottom price for them.
Btw, Hornsby's best quote was ~105k (HS, roof, 19 built, no heat seat, no wireless)
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      12-30-2019, 04:49 PM   #26
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Originally Posted by apue View Post
My work colleague showed his interest in my golf R,
That's fantastic Apue. That should lower your change-over price even more. Great stuff. Happy New Year!
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      12-30-2019, 07:04 PM   #27
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Originally Posted by apue View Post

Nothing wrong with my golf R 7.5.
It has dynaudio so I was happy with car.
But the sound note is utterly crap compared to M140i, RS3 and M2.
Fair enough - it's a good all round car. I just want a bit more theatre when driving though. Hopefully I can keep my DSG golf r as the second car and pick up an manual M2.
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      12-31-2019, 02:51 AM   #28
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Originally Posted by BMWF87Melb View Post
Fair enough - it's a good all round car. I just want a bit more theatre when driving though. Hopefully I can keep my DSG golf r as the second car and pick up an manual M2.
That would be a perfect combo!
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      01-14-2020, 06:50 AM   #29
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Let me get my disclaimer out of the way first. I'm not an expert in buying cars. I'm just an average Joe who've spent a lot of time researching this topic. And in December 2019, I've purchased a built-to-order, MY2020 M2 Competition.

Reading about my purchase, a few members on this forum contacted me by Private Message (PM). That was the catalyst for this post. I hope my rambling helps someone get a better price on their M2.


Buy a Demo, Executive Driven or Brand New?

I have found that Australian BMW dealers sell their demonstrator vehicles at around 3,000kms - 4,000kms. The prices are reduced by about $5,000 to $7,000 compared to the brand new models. The price is undoubtedly enticing.

My recommendation is to AVOID demos and 'executive driven' cars. Why? In a nutshell, you don't know how they were driven. The M2 Competition is a performance car. People test driving them, may have had too much fun in them (if opportunity permitted). Most of the engine damage occurs when they are cold. Also, the first 2,000kms is the run-in period. Maybe you and I will never thrash test vehicles, but not everyone respects other people's properties. By the time an M2 demonstrator is sold at say 3,500kms, some 200 people have driven the car.

The term 'executive driven' is a euphemism. It could have been a press car, demo car, get-away vehicle and who-knows-what? If you want another opinion on buying a demo car, watch this video:

https://youtu.be/BQctuPp3kjU


Brand New Car is Not a Brand New Car!

If you spot a brand new M2 Competition in the showroom with only the delivery mileage of say 20kms, that's a brand new car, right? Not in my book. A car in the showroom (not a demonstrator) is not the same as a brand-new car that just landed in the country on a cargo ship. Why?

That unlocked 'brand new' M2 in the showroom had hundreds of butts getting in-and-out over the past year, and some have inadvertently scratched the car with their shoes, watches, rings, studs, chocolate covered kids with hard toys, etc., You don't care about the cosmetic damage to save $5,000? How about this? Did the dealer offer to start the car for you so that you could admire the exhaust note?

A friend of mine bought a brand new car off the showroom floor (not a BMW), and it had an engine problem within a year. The inspection revealed glazed bore. The diagnosis is that it must have been started and revved-up too many times before the engine was run-in properly. If the dealer started the car for you, they would have done the same for hundreds of people before you. I did say that most of the engine damage occurs when they are cold? Add excess revving when cold and see what happens.

Knowing the risk, if you still want a showroom vehicle, go for it. Do factor in the wear and tear and negotiate accordingly. It is comparable to buying the last, display model mobile phone that has been sitting on the open shelf for the past year. Many people will not pay a full retail price for a display model.

In this post, I will focus on buying a brand new, built-to-order M2 Competition. Anything else is not comparing apples-with-apples, in my opinion.


What's The Difference Between the Model Year vs Build Date?

Don't fall for this car industry trick. Ignore Model Year (MY) of any vehicle. It means nothing, except to unsuspecting newbie car buyers. When you register or insure the car, all they ask is 'When was the car built?' Believe it or not, there is a difference in value between a vehicle that was built in December 2019 and January 2020.


Pricing Difference in 2018 vs 2019 vs 2020?

Assuming the mileage was identical, would you pay the same price for a pre-loved M2 built-in 2018 and another one built-in 2020? If you've answered, 'yes!', please contact me by private message. I have this fantastic snake oil that will cure any illness - yours today only for $5,000!!

If you research the Private Seller Price Guide for M3 Competition (M2 was not listed) on CarSales.com.au, you will see something like this:

- 2016 M3 Competition F80 LCI Auto = $78,700
- 2017 M3 Competition F80 LCI Auto = $89,800
- 2018 M3 Competition F80 LCI Auto = $98,900

The BMW M3 Competition, that is 1 year older, sells for $9,000 - $10,000 less. If a car is 2 years older, the difference is $20,000. That is how much YOU will get when you sell your vehicle.

Knowing this, would you buy a showroom 2018 M2 Competition (2 years old) for only say $5,000 less than the brand new, built-to-order 2020 M2 Competition? It sounds like a good deal, but the dealer is shifting the full brunt of depreciation on to you, the buyer. It would be a different story if the showroom M2C landed only a week ago. If the dealer tells you the car is fresh, check the build date. It takes about 3 months from build to the showroom. If the car was built 12 months ago, it has been sitting around for about 9 months.

I've found that BMW dealers don't discount their old stock as much as some other brands. I was repeatedly quoted similar ballpark prices for MY2018, MY2019 and MY2020 M2C. I would only be interested, if the dealer discounted $10,000 for 1-year-old M2C and $20,000 for 2-year-old M2C, compared to the best-negotiated price for 2020 M2C. Is that likely? No! The dealer is waiting for a keen buyer who wants the lowest purchase price (without any consideration for depreciation) to come along.

In my experience, you are better off buying the built-to-order, brand spanking new car. Either that or go and buy a clean pre-loved (one owner) M2C that was never a demonstrator. If that's you, do make sure you get the vehicle checked up by an independent vehicle inspector who can give you a written report.


Australian M2C Pricing

Let's get down to the reason why you clicked on this thread.

Based on my research in late-2019, the drive-away or on-the-road (OTR) price of $103,000 - $105,000 for the built-to-order 2020 M2 Competition in metallic paint is considered a good deal. Some people still buy M2C at around $107,000 - $109,000 (average deal - many dealers will agree to this price range, most of the time). Although options and accessories are excluded, a couple of sub-$1,000 options can be bundled into this OTR price without a price bump. The big-ticket items like the M Performance brakes and glass sunroof will no doubt increase the final price by a few thousand dollars. It is worth noting that options and accessories are marked-up a lot. If the list price of an option is $3,000, it probably cost the dealer 30% - 40% less (say around $2,100 - $1,800). In some cases, even less.

I have heard of a few people paying <$100,000 drive-away prices, but equally, I have heard of some people paying >$118,000 for the M2C with a few options. So, my prices are just a guide.

Oh and make sure you always negotiate in OTR prices. It is impressive how many fees are associated with purchasing a new car.


Why Does M2C Pricing Vary So Much from Dealer-to-Dealer?

The lowest price a dealer is willing to sell a car varies depending on several factors - incoming stock level, colour of the car, in-stock or special order, factory rebates and incentives, time of the month (or year), sales person's mood, alignment of the planets, how many chickens crossed the road, etc., This is probably the most unpredictable aspect of the buying experience.

You read that John Smith on this forum got an M2C for $102,000 OTR so you think you should be able to get the same price. No!! You see, if John walked into the same dealer and spoke to the same sales person one month after the original deal, that new deal may not be possible. Yet, if you wait another 6 months, they might be able to match the same deal again.

The car industry in Australia is complicated - possibly intentionally. As a Sales Manager of a BMW dealership, you've pre-ordered 20 x M2 Competition last year. As the production date for the first batch nears, your dealership hadn't sold a single M2C. Are you more motivated to move that car by discounting aggressively? You bet! What if you knew BMW Australia would offer your dealership a rebate if you sold 5 more cars this month? There can be many reasons, but it is essential to know that timing is a factor in getting a great price.

The new car sales figures in Australian have been continuously plummeting for the past 20 months. It is a buyer's market. In addition, 2-series is in their last year (or two) of its model life. The S55 engine from M3 and M4 were fitted to M2C because the S58 replaces S55. My point is that S55 engine is approaching the end of service life, as well as the 2-series platform in its current form.

To increase the odds of getting a great deal, you have to be able to walk away. Have you wondered why the sales guys ask you if you are looking at other cars? If you are cross shopping an AMG and Audi RS as well as BMW M car, your options increase (the number of dealers go from 10 in your state to 30). Even if M2C is the only car you are wanting, you don't have to disclose that information.


Do You Want Free Serving for 5 Years?

Sometimes, the dealer 'throws in' free service for 5 years. It is officially known as 'BMW Service Inclusive Package', and it comes in two flavours: Basic ($2,650) and Plus ($7,810). The Basic package covers most of the standard servicing costs like oil change, filters, fluids and labour. The Plus package adds brake pads and discs, clutch plate, as well as… wait for it… wiper blade rubbers!!

Ultimately, you are paying for it one way or another. However, considering the M2C requires a 2,000km run-in service that costs around $700 - $800 (engine oil, diff oil, transmission fluid, etc.,), it is a good idea to include servicing in your deal.

The only fair dinkum free servicing you can get in Australia is to belong to a BMW Advantage Platinum organisation. If you work for a large company or belong to a professional association, it is worth having a chat with them first. Members of Advantage organisations will also get better pricing (so the story goes).

The BMW Advantage organisations also come in Gold flavour. The members of Advantage Gold organisations will receive slightly less benefit - 3 years of free service, instead of the 5 years.

Oddly, M2C sold in other countries do come with genuine free servicing for all.


What is Condition Based Servicing (CBS)?

If you are new to modern-day BMW, there is NO such thing as scheduled servicing with a list of prescribed components that need changing at a particular mileage. Instead, the BMW cars utilise Condition Based Servicing (CBS). The way you drive and the distance travelled will be analysed by your M2C, and the vehicle will determine what needs to be done at the next service. Clever stuff!


M2 Competition Option Pricing

If you know the retail prices of some of the items, please feel free to let me know. I will update this list so that others can benefit in the future. (Edit - Thanks Spree. I have updated missing prices)

- Heated steering wheel (248) - AUD$400
- M Sports brakes (2NH) - AUD$3,000
- Alarm system (302) - AUD$850
- Glass sunroof (403) - AUD$2,700
- Sun protection glazing (420) - AUD$660
- Smoker's package (441) - AUD$60
- Through loading 40:20:40 rear seats (465) - AUD$500
- Heated seats (494) - AUD$650
- Apple CarPlay (6CP) - AUD$450 (New Price - Dec 2019)
- Wireless phone charging (6NW) - AUD$200
- 6-speed manual (Z9a) - No Cost Option (NCO)


What's Going on With Apple CarPlay - Isn't It Free Now?

The news from several sources is that Apple CarPlay pricing has changed in late-2019 - still not free for everyone.

It was explained to me this way. The BMW with iDrive 7 (latest 1-series, 3-series, etc.,) will get Apple CarPlay from the factory for free. Nothing to pay with the car purchase and no ongoing subscription fees.

The BMW with iDrive 6 (like our M2C) will require a one-time payment to activate the CarPlay functionality, and after that, no subscription fees.

A couple of weeks, before the 'Free CarPlay' announcement, BMW offered the following three options in Australia:
- Apple CarPlay for 1 Year = AUD$179
- Apple CarPlay for 3 Years = AUD$379
- Apple CarPlay for Unlimited = AUD$639

Today, there is only one price - an Unlimited duration for $450. The BMW could have kept the 1-year 'activation' for $179 and free-for-life, but that was not to be. The $450 price tag for Apple CarPlay activation will feel less painful if you bundle it in the car deal - yes, I caved and paid.


What's The Recommended Method Of Negotiation?

Firstly, watch this video by John Cadogan titled, 'How to beat the car dealer in 2019'.

https://youtu.be/Oy3JJZKBAZs


Here Are My Buying Tips:

Do your homework and know your prices. If you are buying the car soon, your homework has been done for you in this post. If you are purchasing in a year or two after this article was written, you may need to do your own reconnaissance. Pick a dealer and walk-in, ask questions and get some prices. They will happily provide you with a quote (M2C, all the options you want plus OTR costs). That's a starting point.

Take a closer look at the 'Dealer Delivery' charge on your quote. My first, 'overpriced' quote listed it at eye-watering $4,500. My last, realistic quote read $1,300. That charge is for a dealer to wash and prepare your car, fill in the registration form and submit, attach number plates and fill up with petrol. And that fee is on top of the profit they will make from selling you the car. Yes, we are copping-it both ways! It is like buying a toaster and the retailer charging you a seperate fee for putting it in a carry bag and handing it to you.

So, let's say your M2 Competition with all your accessories adds up to an OTR price (before any discounts) of $125,000. I would take 15% off the total amount. That's about $106,250. You can round it off a bit, depending on what you were quoted for the Dealer Delivery charge. So in this scenario, I would be aiming for $105,000 for this M2C, built-to-order. If you are game, you could try for $100,000 neat, but the dealer rejection rate increases - more on this below.

Now that you have a price, you believe is fair and achievable, it is time to contact the dealers in your state. You can ring or email (many of the BMW dealers don't list their email addresses). I would get on the dealer's website first and find out the name of the 'Senior Sales Consultant'. If the dealership is big enough to have M Specialist Sales Consultant, you can contact them. I would avoid contacting the dealer principal or sales manager. Unless you want 10 cars, they don't usually get involved.

Let's say you decided to call a Senior Sales Consultant at a chosen dealership. The conversation might go something like this:

[COLOR="RoyalBlue"]You: "Hi, I'm interested in purchasing an M2 Competition. Would you have time to discuss it now?"
[/COLOR]
[COLOR="DarkOrchid"]Sales: "Sure. How can I assist you?" (If not available to talk, organise a time to call back or leave your details with them)[/COLOR]

[COLOR="royalblue"]You: "I am after 2020-built M2 Competition in Hockenheim Silver, with DCT, black 788M wheels, heated seats, glass sunroof and M Performance brakes." (The word 'built' is critical. If you say '2020 M2C', that could be interpreted as '2020 model year').
[/COLOR]
— If this is your first dealer contact, you are after the full retail price —

[COLOR="royalblue"]You: "Are you able to provide me with a quote for the vehicle, on the road (OTR) please."[/COLOR]

— If you have already worked out the price you want to pay, go into the negotiation mode —

[COLOR="royalblue"]You: "I would like to offer you $105,000 OTR. If agreeable, I can come in and sign the contract later today."
[/COLOR]
— If they accept your offer, you bought yourself a new M2C. —

[COLOR="darkorchid"]Sales: "I am sorry. We are unable to discount the vehicle to that level."[/COLOR]

[COLOR="royalblue"]You: "I can leave you with my details. Would you be able to have a chat with your sales manager and call me if the situation changes. Otherwise, thank you for your time." [/COLOR]

That's it. You repeat the process with all the dealers in your state, and you might find a dealer who is willing to do the deal. Equally, you may not find anyone who wants to deal at the price you have determined to be fair. Remember, we can do all the homework in the world, but unless we have a dealer who is willing to sell us a car at that price, it is all for nothing.


Dealer Rejection Rate

I mentioned the rejection rate above. Let's expand on that. What happens if you call all the dealers in your state and every one of them rejects your offer?

Option 1 - Call them back with a higher offer.

Option 2 - Try again in a few months.

Option 3 - Try another brand or hold off buying.

Option 1 is the weakest position you can put yourself in at this point. When you call back and speak with the consultant, they know they have you by the short and curly. Now you are playing their game. They will keep on rejecting your offers until you end up paying what they want you to pay.

This is why choosing a price that is too low can backfire on you.

Option 2 is self-explanatory. You are still not in a strong position. But waiting a few months before contacting the dealer again, you may catch them at a better time to negotiate (as mentioned above).

Option 3 is walk-away for now proposition.

As you can see, you have one shot at this style of negotiation. It all comes down to the price you want to pay. If you offer the dealer, say $110,000, your rejection rate will reduce considerably. But are you happy with the final purchase price? It is a balancing act.

[COLOR="RoyalBlue"]You have to commit to 'take it or leave it' philosophy, and be able to walk away[/COLOR]. If you ask a question like, '...So, if you can't do $105,000, what can you do it for?' You have just signalled your desperation and eagerness to buy the new car. Your negotiation is over the moment you ask that question.

If you cannot walk away, you are less likely to get a fantastic deal. Don't let your emotion take control of the negotiation.


The Devil Is In The Detail

So you and the dealer reached an agreement? Fantastic, but don't relax yet. Make sure everything that matters to you is documented in the sales contract BEFORE you sign it. Everything from your options, accessories, colour, trade-in value, timeframe, any other conditions, etc., Sometimes, they are not always obvious.

If the car you want is $100,000 and your trade-in is valued at $30,000. The change over price is $70,000. A week before the delivery date, by chance, someone offers you $35,000 for your car. Depending on how the contract was drawn up, you may not be able to sell your car privately and hand over $70k in cash for your new vehicle. The dealer may have lowered the book value of both cars to make the deal work. It is my recommendation that the reader negotiates the price of the new vehicle as if there is no trade-in. This way, you are comparing apples-with-apples on prices. The trade-in can always be added to the deal at any time before signing the contract. If you think you want the option to sell privately, have it written in the contract.

On another topic, some dealerships employ 'Sponge Bob' to detail their cars. If a vehicle is washed with a sponge, the paint is scratched. If you value the pristine finish of your new car, check out their past work. How? Easy!

Walk up to a couple of black cars in the showroom and inspect them. Do use your phone torch and examine the reflection surrounding the bright spot on the paint surface. If you see swirl marks on brand new cars in the showroom, that dealer employs a Sponge Bob.

If you must buy your car from that dealer, you can insist that they don't touch the painted surface of your vehicle for the delivery preparation (and have that written in the sales contract). I would go a step further and insist that they leave the white paint protection film from the factory left on the car (you can peel them off yourself). The white plastic covers the hood, roof and boot. If you think I am overreacting, check out 'paint swirl removal' on Youtube. It is a time consuming and expensive repair job.


Dos and Don'ts When Negotiating

Do remain polite and professional. I know you are excited, but the dealer has to make a living as well. Don't get emotional. Don't make it personal if the dealer rejects your offer. They have their price, and you have yours.

Do remember that new car sales industry in Australia has been in decline for 21 consecutive months. Although BMW bucked the trend by remaining 'flat' rather than 'plummeting' in 2019, all dealers want to sell more cars. They don't want YOU, the buyer, to know that they are eager (or even desperate). It's a game!

Don't pit one dealer against another dealer. You are not trying to make a friend, but you are not trying to piss them off either. If you've worked out a fair price and the dealer agrees, honour the agreement. Don't take that quote and try to get another $1,000 off from a different dealer.

Don't be discouraged by all the rejections. You only need one dealer to agree, and you got yourself a new car at a great price.


Closing Comment

I hope this post helps you. If you have other negotiation methods that worked for you and you want to share, please post below.

If this benefited you, please click on the [Appreciate] button so I know it was useful.


BMW M2 Competition Dealer Australian Specification Guide - March 2019 Production
Wow, what an in-depth thread. Kudos to you. Very informative and I'll keep in mind everything you said when I decide to purchase my M2C.

I really agree with what you said about demos and floor stock, it's so true. I won't say which bmw but when I went for a test drive last month the car salesman told me this M2C Is brand new it had 16km on the dial, he came with me and after around 15 min I pulled over to take photos and the salesman said let me drive it quickly, first thing he did was turn traction off and did a massive drift up the road. All I could think about was the poor engine and the poor broke who is going to buy it.

I always get built to order when I get my cars.
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      01-14-2020, 05:44 PM   #30
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Originally Posted by Harrison kayy View Post
Wow, what an in-depth thread. Kudos to you. Very informative and I'll keep in mind everything you said when I decide to purchase my M2C.

I really agree with what you said about demos and floor stock, it's so true. I won't say which bmw but when I went for a test drive last month the car salesman told me this M2C Is brand new it had 16km on the dial, he came with me and after around 15 min I pulled over to take photos and the salesman said let me drive it quickly, first thing he did was turn traction off and did a massive drift up the road. All I could think about was the poor engine and the poor broke who is going to buy it.

I always get built to order when I get my cars.
A dealer in Sydney did exactly same when I had a test drive.
The car was brand new (i.e no registered) and it's already over 100km.
I told the sales we shouldn't accelerate until 2,000km and he said "don't worry about it, we need to pull hard to break-in".
My point is that it's classified as 'Brand new' even though it was used for a test drive few f times. I wondered who would buy it as new.

Having said that, let me ask how many BMW dealerships on earth? They must be doing similar practice. The M2C is a rare/expensive car so they can't afford to have a dedicated loan or a demo car for each dealership. Given that quite a few M2C were sold as new/demo globally, I have not heard any significant issue because they have bought the driven new or demo including the M3/M4/M5 etc.
So pulling hard mildly won't do harm for the cars, IMO.
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      01-15-2020, 07:28 AM   #31
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Originally Posted by Harrison kayy View Post
Wow, what an in-depth thread. Kudos to you. Very informative and I'll keep in mind everything you said when I decide to purchase my M2C.
Glad it was informative for you. Yep! Demo cars can be subjected to a lot of driving styles.
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      01-15-2020, 11:08 PM   #32
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I'm very happy to buy stock or demo vehicles — with a deep discount — just to piss off Cadogan! I'm pretty sure he's the guy that tells Camry owners to drive below the speed limit in the R/H lane!

It all depends how long you are going to keep the car.
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      01-15-2020, 11:56 PM   #33
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Originally Posted by ttimbo View Post
I'm very happy to buy stock or demo vehicles — with a deep discount
If a demo is discounted significantly beyond a discounted BTO vehicle, it can be a value proposition for some owners (i.e. someone who turn cars over regularly).

If the best price today for 2020 built M2`C in metallic paint is $103,000 drive away. A brand new 2019 M2C with no mileage would have to be $10,000 less (say $93,000 OTR). If the car is a demo with 3,000kms, I would want another $10,000 off the price (say $83,000 OTR) - I'm being generous here. Just the GST and LCT adds up more than $10k. I'm sure we all know how much depreciation there is on a $100k car the moment it is driven out of the dealership.

The demo car is a used car with low mileage. It was registered, and it was driven. The new car warranty is shorter too. Of course, the salesperson wants us to accept that a demo car is still new.

Quote:
Originally Posted by ttimbo View Post
It all depends how long you are going to keep the car.
If someone is planning to keep their M2C beyond the warranty period, they might think differently to someone swapping cars every 18 months.

Ultimately, the buyers decide what works for them.
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      01-16-2020, 04:40 AM   #34
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How To Get The Best Price On a BMW M2 Competition in Australia

Good points....but, as you point out, the biggest cost of ownership is depreciation, much of which happens the moment you drive away from the dealer.

So, consider two identical M2Cs except for colour — one BTO, delivered in February 2020 at "a good price" (who knows) of $103K OTR; the second, which has been sitting on the forecourt for a couple of months,registered and with 100km on the dial, which I buy on the same day the BTO is delivered, for (as you suggest) $93k OTR.

Now, project forward to June 202x, when both cars are being sold by their respective owners. Both cars will have more or less the same Red Book or Glass's value...but one owner paid $10k less. That owner is ahead — simple. And it's pretty likely no-one buying from that owner will ask (or care) whether it was BTO or bought off the forecourt!

Just food for thought
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      01-16-2020, 06:59 AM   #35
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Quote:
Originally Posted by ///Driver View Post
If a demo is discounted significantly beyond a discounted BTO vehicle, it can be a value proposition for some owners (i.e. someone who turn cars over regularly).

If the best price today for 2020 built M2`C in metallic paint is $103,000 drive away. A brand new 2019 M2C with no mileage would have to be $10,000 less (say $93,000 OTR). If the car is a demo with 3,000kms, I would want another $10,000 off the price (say $83,000 OTR) - I'm being generous here. Just the GST and LCT adds up more than $10k. I'm sure we all know how much depreciation there is on a $100k car the moment it is driven out of the dealership.

The demo car is a used car with low mileage. It was registered, and it was driven. The new car warranty is shorter too. Of course, the salesperson wants us to accept that a demo car is still new.
.
I would like to know where you got the pricing idea (ie. 103-93-83k) .
I've tried several scenarios. I wonder if you could achieve 83K driveaway for 18 built.

The price of the demo/floor stock is discounted because it's not just from aging but the options/color choice was also limited. So someone who's flexible with option/color, buying one from their yard/floor is a great way to save.

When it's the time to sell my car after 5 years I don't expect the valuation gap is that great because there is no change in the spec and inclusions between the years.
The odometer number is the big part of the valuation.
If I sell it via private the next buyer is keen to know other factors.
How many Kms is the car done,
if the car was properly serviced,
if the car had been modded,
if the car had any accident,
if the seller is the first owner.

Having said that if I trade in at a dealer they don't care whether I bought a demo or floor stock or BTO. And don't forget the higher initial cost means bigger financing cost (compounded!)

Nonetheless, I agree with the idea that we should be wary of a demo whether it was
abused
I once had a built to order from Merc and the car had lots of issues, anyway.
And I had learned in hard way. The depreciation curve is the steepest for the built to order because the discount amount was the least.
Besides most BMW and Audi are depreciating fast.
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      01-16-2020, 07:01 AM   #36
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Quote:
Originally Posted by ttimbo View Post
Good points....but, as you point out, the biggest cost of ownership is depreciation, much of which happens the moment you drive away from the dealer.

Just food for thought
Bingo. At the end of the day we're not buying an investment product but an expensive toy.
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      01-16-2020, 09:14 AM   #37
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Quote:
Originally Posted by ttimbo View Post
Now, project forward to June 202x, when both cars are being sold by their respective owners. Both vehicles will have more or less the same Red Book or Glass's value...but one owner paid $10k less. That owner is ahead — simple.
Hi ttimbo, if you refer to my original post (section about pre-owned M3 valuation on CarSales), there is indeed a $10k difference between two identical cars, 1-year apart. So if a buyer got a 1-year old demo for $10k less than BTO, all else being equal, the 1-year older demo vehicle will also sell for $10k less when the owner decides to move on to the next car. So in the above fictitious scenario, both the demo buyer and the BTO buyer paid a fair price for what they’ve purchased.

On the other hand, if a 1-year-old demo car was only $3,000 less than the best price of a BTO, that price tag would not impressive me. Sure, the buyer paid $3k less for their vehicle (lower entry price), but they also bought one year older car which will sell for $10k less (much lower exit price). Of course, if the demo car was first registered in Feb 2019 and the BTO was Aug 2019, the story would be different as they are both built in the same year (the resale value would be comparable.

At the end of the day, we all have to weigh up the numbers and decide for ourselves. No wrong decisions here. Some people are cashed up and time-poor, they will walk into a dealer and pay full retail price. Is that wrong? Not for the one with cash. Could they have gotten a better dealer? Sure. Is that important for everyone? Certainly not.

Quote:
Originally Posted by ttimbo View Post
And it's pretty likely no-one buying from that owner will ask (or care) whether it was BTO or bought off the forecourt!
If the demo car was never registered and lived a life with a trader plate, the buyer would not know. However, if the demo car was registered to the dealer for a year, the new buyer will know that they will be the 3rd owner of the vehicle. That may or may not have an impact on the final selling price. All depends on the buyer and what they value (e.g. built date, number of previous owners, mileage, tracked, etc.,)

Last edited by ///Driver; 01-17-2020 at 04:31 AM..
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      01-16-2020, 09:39 AM   #38
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Quote:
Originally Posted by apue View Post
I would like to know where you got the pricing idea (i.e. 103-93-83k) .
I've tried several scenarios. I wonder if you could achieve 83K driveaway for 18 built.
It is entirely made up for the sake of discussion.


Quote:
Originally Posted by apue View Post
When it's the time to sell my car after 5 years I don't expect the valuation gap is that great because there is no change in the spec and inclusions between the years.
The odometer number is a big part of the valuation.
I agree, the mileage is a significant factor in determining the used vehicle value. However, the build date is also a factor as well.

Go to CarSales (or any other valuation site of your choice) and choose BMW M3 Comp F80 (or any other comparable vehicle), you will see figures like this.

- 2016 M3 Competition F80 LCI Auto = $78,700
- 2017 M3 Competition F80 LCI Auto = $89,800
- 2018 M3 Competition F80 LCI Auto = $98,900

Please note the difference in private sell price guide - only variable is the year or build date, which factors in an average mileage. However, no matter how low the mileage, a 2016 F80 M3C will not fetch the same price as 2018 F80 M3C with similar mileage. Why? Because 2016 is two years older.


Quote:
Originally Posted by apue View Post
If I sell it via private the next buyer is keen to know other factors.
How many Kms is the car done,
if the car was properly serviced,
if the car had been modded,
if the car had any accident,
if the seller is the first owner.
The prospective buyer can ask these questions, but I can't imagine all sellers will disclose that their vehicle had an accident or it was tracked. Getting a written vehicle inspection from an independent assessor would be better.

And as you have stated, the buyer would want to know if you are the first owner. If the car was registered to the dealer first, you would be the 2nd owner. Then the questions regarding the 1st owner will need to be addressed.


Quote:
Originally Posted by apue View Post
The depreciation curve is the steepest for the built to order because the discount amount was the least.
No doubt about it! Keep in mind, well over $10,000 of the new OTR car price is GST and the Luxury Car Tax. The first owner pays them. Once paid, that money disappears into thin air. At least the next buyer of your car will thank you for it!


Some people value lowest entry price above everything else. Some might buy a 2018 M2C to save another $1,000 over buying a 2020 M2C. There is nothing wrong with that choice. It's their money. As long as they are walking into the deal with their eyes wide open. They are not getting the same car with same value.

Last edited by ///Driver; 01-17-2020 at 04:42 AM..
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      01-16-2020, 09:44 AM   #39
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Quote:
Originally Posted by apue View Post
Bingo. At the end of theAs we're not buying an investment product but an expensive toy.
Absolutely!!

As you said, it doesn't matter if we buy a 2019 M2C or 2020 M2C if that vehicle is kept for say 10 years (the difference in valuation between an 10-year old car and 11-year old car is insignificant). However, if they kept it for only say 2-years, the valuation of 2-year old car and 3-year old car would be significant.

Last edited by ///Driver; 01-17-2020 at 04:42 AM..
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      01-18-2020, 12:25 AM   #40
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Quote:
Originally Posted by ///Driver View Post
Absolutely!!

As you said, it doesn't matter if we buy a 2019 M2C or 2020 M2C if that vehicle is kept for say 10 years (the difference in valuation between an 10-year old car and 11-year old car is insignificant). However, if they kept it for only say 2-years, the valuation of 2-year old car and 3-year old car would be significant.
Yes, but the difference should be smaller than the gap of the initial driveaway prices. The main benefit to do BTO is I can choose color/option that I want.

However, it's not uncommon to see a brand new car is also damaged whilst on transit. They then do a touch up or repair and hand it over to buyers.
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      01-18-2020, 01:52 AM   #41
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Quote:
Originally Posted by apue View Post
Yes, but the difference should be smaller than the gap of the initial driveaway prices.
Maybe, maybe not. It all depends on who is buying your car. If they are a private buyer (potentially less experienced), they could just pay your asking price - without haggling. Then anything is possible.

However, if you were to trade-in to a dealer, a car that is 1-year older (say 2018 build) will fetch considerably less money than another car that is newer, say 2019.

My objective with the original post was to point out that older cars will fetch less money when selling - so negotiate harder.

When I was shopping around, I've had a dealer try to sell me a showroom brand new (20kms on the odometer) that was never registered, but it was a 2018 build. They wanted to sell it to me for $106,000! Maybe I could have negotiated them down to $103,000, but I didn't bother.

Thanks to this forum, we know that a brand new BTO 2020 M2C could be had for say $105,000 OTR. So I would be crazy to buy a 2-year old M2C to save $2,000. That would have been false economy.

The dealers want us to believe that 2018 M2C and 2020 M2C are worth the same money because they have the same specs. That's a fast talking dealer right there! The fact is, older cars are worth less money, even if they are brand new. This is reflected in the price we can fetch when we sell. Even the insurance company will pay out less money on older cars that are written off - even if it is only 1-month old to you, to the insurance company, the car is 2-years old.

Here is a second opinion on this topic.




In addition, if the M2C was a demo (and an old stock), that lowers the value even more. The buyer should be aware and negotiate accordingly.


Quote:
Originally Posted by apue View Post
The main benefit to do BTO is I can choose color/option that I want.
Being able to choose the colour and options are nice, but it's also nice to know that it wasn't sitting in the showroom unlocked for a year with 100s of butts getting in-and-out wearing out the seats, scratching the door panels with their shoes, etc. It is also nice to know that the dealer has not started the cold engine and revved it hundreds of times to demonstrate the sound of the exhaust.


Quote:
Originally Posted by apue View Post
However, it's not uncommon to see a brand new car is also damaged whilst on transit. They then do a touch up or repair and hand it over to buyers.
That can happen but if the dealer is honest, they would disclose the damaged and allocate a new vehicle to the buyer (more waiting) or offer a generous discount.

Last edited by ///Driver; 01-19-2020 at 04:34 AM..
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      01-20-2020, 05:20 PM   #42
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Quote:
Originally Posted by ///Driver View Post
Maybe, maybe not. It all depends on who is buying your car. If they are a private buyer (potentially less experienced), they could just pay your asking price - without haggling. Then anything is possible.

However, if you were to trade-in to a dealer, a car that is 1-year older (say 2018 build) will fetch considerably less money than another car that is newer, say 2019.

My objective with the original post was to point out that older cars will fetch less money when selling - so negotiate harder.

When I was shopping around, I've had a dealer try to sell me a showroom brand new (20kms on the odometer) that was never registered, but it was a 2018 build. They wanted to sell it to me for $106,000! Maybe I could have negotiated them down to $103,000, but I didn't bother.

Thanks to this forum, we know that a brand new BTO 2020 M2C could be had for say $105,000 OTR. So I would be crazy to buy a 2-year old M2C to save $2,000. That would have been false economy.

The dealers want us to believe that 2018 M2C and 2020 M2C are worth the same money because they have the same specs. That's a fast talking dealer right there! The fact is, older cars are worth less money, even if they are brand new. This is reflected in the price we can fetch when we sell. Even the insurance company will pay out less money on older cars that are written off - even if it is only 1-month old to you, to the insurance company, the car is 2-years old.
We agreed with this point. Of course we'd ask a reasonable discount for the 2 years old car, (i.e built 2018) model. In my case I got roughly 10~12K (not 20k) off from the equivalent 2020 BTO and I'm happy with my purchase.


Quote:
Originally Posted by ///Driver View Post
Here is a second opinion on this topic.




In addition, if the M2C was a demo (and an old stock), that lowers the value even more. The buyer should be aware and negotiate accordingly.


Being able to choose the colour and options are nice, but it's also nice to know that it wasn't sitting in the showroom unlocked for a year with 100s of butts getting in-and-out wearing out the seats, scratching the door panels with their shoes, etc. It is also nice to know that the dealer has not started the cold engine and revved it hundreds of times to demonstrate the sound of the exhaust.

That can happen but if the dealer is honest, they would disclose the damaged and allocate a new vehicle to the buyer (more waiting) or offer a generous discount.
I thought we also agreed with this point. It's matter to someone what's important to him/her.
Sure, there could be some dust and a bit of mark on the seat, which is why we'd ask for significant discount. Don't forget we're buying a depreciating item, so there won't be any difference between a floor stock car and the BTO in terms of the condition after 4-6 years but the financial positions are.
Like Timmbo posted the financial position is more important to me. It allows me in a better position to move to next M series comfortably. I don't have a deep pocket to swallow high depreciation hit.

BMW (like other Euros) changes the spec/enhancement normally after Aug of the year. Essentially the Aug 2018 should be treated as Jun 2019 model.
Can you please inform me if there is any hardware changes from Dec/2018 Dec to Jan/2020 built cars? AFAIK, no difference between them.

On the other hand if someone considers an Jan/2018 built M2 and try to compare with Dec/2018 built M2, they're different cars! So I would ask minimum 15K discount even if they're built in same year.


I've seen a couple of case where the dealers did try to cheat customers for the car conditions.
Dealers certainly don't want buyers know the full history of the car.
Sometimes, they hide some minor damage from hail and sell it as undriven demo. Sometimes they repair the car before delivery while on transit.
It actually happened to Mercedes and Audi dealers.

Last edited by apue; 01-20-2020 at 05:30 PM..
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      01-21-2020, 07:46 AM   #43
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Quote:
Originally Posted by apue View Post
Can you please inform me if there are any hardware changes from Dec/2018 Dec to Jan/2020 built cars? AFAIK, no difference between them.
The best case scenario, BMW may have revised some components based on the number of warranty claims or due to supplier/parts batch change. However, most likely the 2018 M2C are identical to 2020 M2C.


Quote:
Originally Posted by apue View Post
...On the other hand if someone considers an Jan/2018 built M2 and try to compare with Dec/2018 built M2, they're different cars! So I would ask minimum 15K discount even if they're built in same year.
That August date you mentioned is the 'Model Year'. That is a car industry fairytale. Only the actual assembly/build date matters from the perspective of value retention. So in the above example, January 2018 and Dec 2018 will have minimal difference in the resale market valuation, assuming that all else is identical (eg. mileage and vehicle condition).

It will have been a different story if M2C was an older model and it was revised or facelifted in August 2018 to coincide with the new model year. However, in this thread, we are assuming the car remained the same.


Quote:
Originally Posted by apue View Post
I've seen a couple of case where the dealers did try to cheat customers for the car conditions.
Dealers certainly don't want buyers know the full history of the car.
Sometimes, they hide some minor damage from hail and sell it as undriven demo. Sometimes they repair the car before delivery while on transit.
If those vehicles were represented as brand new cars, that would fraudulent.

If the 'touched-up' or 'fixed-up' cars were demo or used cars, that is pretty much a standard practice. Why? The dealer is selling those cars 'as is'. The responsibility falls on the buyer to inspect the vehicle before purchase. As long as the dealer does not lie and get caught, the buyer can't do anything about it. That is why, if the buyer asks the salesperson if the vehicle was in an accident or ever been repaired? The answer is "Not to my knowledge." Even if the buyer can later prove the demo vehicle was smashed and repaired, unless the buyer can also prove the salesperson knew about it, there will be no recourse.

If I was buying a demo vehicle from a dealership, I will have this written in the contract - "A1 BMW Pty Ltd will declare that the vehicle in this sales agreement was never involved in an accident or sustained panel damage requiring a respray." If the dealer agrees to put that in the contract, they must be pretty confident.


Quote:
Originally Posted by apue View Post
In my case I got roughly 10~12K (not 20k) off from the equivalent 2020 BTO and I'm happy with my purchase.
THIS is all that matters Apue! Enjoy your new car and post up a pic when you pick up your car.

Last edited by ///Driver; 01-22-2020 at 02:47 AM..
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      01-25-2020, 04:21 AM   #44
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Quote:
Originally Posted by ///Driver View Post
The best case scenario, BMW may have revised some ...
That August date you mentioned is the 'Model Year'. That is a car industry fairytale. Only the actual assembly/build date matters from the perspective of
THIS is all that matters Apue! Enjoy your new car and post up a pic when you pick up your car.
I often find Aug is the month that German makers change the spec.
I suppose M2C has been rolled out since Aug2018.
So Jan 2018 should be M2 LCI.

I got my car few weeks ago. I am very happy with the car.
Oh. The brake rotor is a bit strange that it makes very loud squeezy noise when a stone is stuck inside. I found it is a common problem with M cars.
I wish the fuel tank is bigger so it last further.
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