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      11-07-2013, 01:38 AM   #1
paddy335
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What is the most profitable BMW M model?

Does anyone know? Any of you insiders able to share which of the M3, 5, 6 is the most profitable, per unit?

Last edited by paddy335; 11-07-2013 at 02:08 AM..
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      11-07-2013, 02:34 AM   #2
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Quote:
Originally Posted by paddy335 View Post
Does anyone know? Any of you insiders able to share which of the M3, 5, 6 is the most profitable, per unit?
Good question. My best educated guess is the 5er because it combines a high price with a reasonably high volume for the base car.

You might need to refine your question to include E90 and E92. Why? The huge importance of volume on price in manufacturing. The E90 is built on a chassis of a very high volume car globally as compared to the E92. Some of these models have a full order of magnitude of difference in production volumes and that in turn has a big effect on the cost of manufactured and purchased components.
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      11-07-2013, 03:13 AM   #3
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Good point swamp. Let's make it the most profitable between the M3 E92 (being the more bespoke), M5 and M6.
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      11-07-2013, 07:02 AM   #4
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I know you didn't name it in your list, but I'd consider the X5 M a possible candidate.
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      11-07-2013, 08:12 AM   #5
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i think the answer would depend on a few things (which perhaps others can weigh in on):

  • when looking at product line profitability, how does BMW allocate R&D and other overhead costs? one might argue that M vehicles consume more R&D resources than others
  • what is the volume, by product line? i would think for the higher volume M cars, BMW could eke out a few more margin points as they "optimize" stuff during the production run
  • what price will the market bear for a given model? Example: the e92 is most likely not too different in production cost from an e90, so the additional upcharge for the coupe will go straight to margin. the M6 GC may be another example of this
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      11-07-2013, 09:08 AM   #6
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Quote:
Originally Posted by paddy335 View Post
Good point swamp. Let's make it the most profitable between the M3 E92 (being the more bespoke), M5 and M6.
E92 is more bespoke than what?

I'm guessing that word doesn't mean what you think it means.
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      11-07-2013, 10:00 AM   #7
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Quote:
Originally Posted by Swancoat View Post
E92 is more bespoke than what?

I'm guessing that word doesn't mean what you think it means.
He was responding to Swamp"s post about volume being a factor in overall profitability. Since coupes were sold about 4x more often than sedans, he based it on the E92.
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      11-07-2013, 11:44 AM   #8
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Originally Posted by Never Convicted View Post
He was responding to Swamp"s post about volume being a factor in overall profitability. Since coupes were sold about 4x more often than sedans, he based it on the E92.
So, I don't think bespoke means what you think it means either.

Bespoke usually means custom, individually made to your exact specifications.

Now: Does the E92 seem more bespoke than other M cars? Just the opposite I think.
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      11-07-2013, 11:58 AM   #9
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Profit per unit I would guess the current M5 due to it's high price, modded production engine and chassi of a high volume car. The X5M has similar cost advantages but is produced in smaller numbers. The E9X has the S65 which is likely very costly in relation to the sale price of an E9X M3 eating on the profit.

For standard cars the E60 contributed with over 50% of BMWs overall margin, not sure how those figures are with the F10.

Overall profit contribution from Ms I would guess comes from the M3 due to it's relatively higher sales volume.

Last edited by solstice; 11-07-2013 at 12:04 PM..
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      11-07-2013, 12:42 PM   #10
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Quote:
Originally Posted by Swancoat View Post
So, I don't think bespoke means what you think it means either.

Bespoke usually means custom, individually made to your exact specifications.

Now: Does the E92 seem more bespoke than other M cars? Just the opposite I think.
OK...now use your understanding of the word bespoke, and read his post again. He specified that the E92 was "more bespoke (use "more custom" or "more made to exact specifications") to the post he was answering about which model of the E9x he meant. Was it really indecipherable to you what he was saying? Or are you trying to hijack the thread into a discussion of suits and Sea Island cotton shirts?
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      11-07-2013, 01:12 PM   #11
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Quote:
Originally Posted by Never Convicted View Post
OK...now use your understanding of the word bespoke, and read his post again. He specified that the E92 was "more bespoke (use "more custom" or "more made to exact specifications") to the post he was answering about which model of the E9x he meant. Was it really indecipherable to you what he was saying? Or are you trying to hijack the thread into a discussion of suits and Sea Island cotton shirts?
Fair enough, but it wasn't that clear. It read like he was saying the E92 was more bespoke than the M5 or M6, which I would disagree with pretty readily (largely on the back of the M6 which I'd guess has far more custom orders).

If your point though is that the E92 is more bespoke than the E90, I'm not I'd agree with that either. Not that I'd outright disagree, just that I don't think there's a clear answer one way or another. I suspect with far fewer E90 M3s sold than E92s, that more of them may have been ordered though.
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      11-07-2013, 01:20 PM   #12
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Quote:
Originally Posted by Swancoat View Post
Fair enough, but it wasn't that clear. It read like he was saying the E92 was more bespoke than the M5 or M6, which I would disagree with pretty readily (largely on the back of the M6 which I'd guess has far more custom orders).

If your point though is that the E92 is more bespoke than the E90, I'm not I'd agree with that either. Not that I'd outright disagree, just that I don't think there's a clear answer one way or another. I suspect with far fewer E90 M3s sold than E92s, that more of them may have been ordered though.
He's from New Zealand. You have to turn your head to the side and squint to understand anything he says. (It was a JOKE, Paddy!)
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      11-07-2013, 01:32 PM   #13
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I think the margins on the 1M were pretty high being that is was a high priced car with parts they already had. Next I would think the M6 because of its premium over the M5.
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      11-07-2013, 01:56 PM   #14
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Quote:
Originally Posted by Never Convicted View Post
He's from New Zealand. You have to turn your head to the side and squint to understand anything he says. (It was a JOKE, Paddy!)
BAHAHAHA.....and thanks though for doing a nice job of making a perfectly accurate explanation of the context in which I used the word 'bespoke'. Which was certainly not literal. And indeed as you said, in response to swamp2's excellent suggestion at the outset.

Now, back to determining which is the most profitable....

(the question being stimulated by that hilarious news recently that the Bugatti Veyron made a cheeky little $7M loss per unit)
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      11-07-2013, 03:49 PM   #15
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With all of the stats that get tossed around this place, I would have thought this would have been answered already rather than playing the game of "Conjecture Spector".
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      11-07-2013, 03:58 PM   #16
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Higher margins as you go higher market. M6 tops the list for profit-margin. As for most profitable based on both margins and volume, probably the M3.
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      11-07-2013, 04:54 PM   #17
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Quote:
Originally Posted by Sedan_Clan View Post
With all of the stats that get tossed around this place, I would have thought this would have been answered already rather than playing the game of "Conjecture Spector".
There was the analysis released a couple of months back about the biggest loss makers per unit (including the MB A2), and have had a hunt around for anything on the biggest profit makers but found nothing.

I suppose it is stretch to expect BMW insider input to this discussion.
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      11-08-2013, 09:58 AM   #18
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I'm interested too, can this information or similar be found in the financial statements?
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      11-08-2013, 11:35 AM   #19
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Quote:
Originally Posted by buildbright View Post
I think the margins on the 1M were pretty high being that is was a high priced car with parts they already had. Next I would think the M6 because of its premium over the M5.
I'd tend to agree with you on a per car basis.

But if you're talking pure overall profit, we probably need to factor in volume. I'd say the M3 wins there. Same as I'd tend to guess that the 328 is probably the most overall profitable car due to volume, at least in the US. Time to pull out quarterly reports and financial statements to be sure!
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      11-08-2013, 02:21 PM   #20
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Would you be surprised to know its the X6 M.
This is considered as the "volume" M model it sells in high numbers globally and is a high profit vehicle.

And you wonder why the X6 and X6M are being replaced?
Why there is going to be an X4 and X2?
And why competitors are currently developing their X6 Competitors?

The X6 and X6M are a license to print money.
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      11-08-2013, 02:31 PM   #21
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Quote:
Originally Posted by SCOTT26 View Post
Would you be surprised to know its the X6 M.
This is considered as the "volume" M model it sells in high numbers globally and is a high profit vehicle.

And you wonder why the X6 and X6M are being replaced?
Why there is going to be an X4 and X2?
And why competitors are currently developing their X6 Competitors?

The X6 and X6M are a license to print money.
I would think Russia and the Middle East are reasonably important markets in this equation?
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      11-08-2013, 02:39 PM   #22
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Quote:
Originally Posted by solstice View Post
I would think Russia and the Middle East are reasonably important markets in this equation?
China and Brazil also.
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