• Apr 12th 2007 at 2:09PM
  • 6
Now here's a story that won't take many Europeans by surprise. Just as GM, Chrysler and Ford get knocked for selling tons of vehicles to rental fleets in the States, BMW and Audi do basically the same thing in Europe. In fact, those two German firms lead the list of automakers who rely the most on fleet sales in their home market. This according to auto motor und sport magazine, which has reported that Audi and BMW "have the fewest private customers of all brands in Germany," with just 33.5% and 32.8% respectively. Mercedes was least likely to send a vehicle to Deutsch Hertz, with 50.1% going to private owners. VW rang in at 47.5%, Ford at 41%, and Opel tallied 39%.

To put those numbers in perspective, in the U.S., Ford sells about 66% of its vehicles now to private buyers, and 34% to fleets, which is almost the complete opposite of BMW and Audi in their home markets. Both Ford and General Motors, as well as the Chrysler Group to an extent, have managed to lower their fleet and rental sales in the first quarter of 2007.

Fleet sales take a toll on automakers because of the big discounts with which they're usually associated. The magazine says that the Focus typically sells to fleets at a discount of 28%! Passats (27%), Renault Lagunas (30+%) and Ford Mondeos (30+%) also go for a song. At 30% off those cars aren't making much if any money for the manufacturers. Essentially, they just keep the plants running, according to one sales director. It's hard to say why the percentage is so huge in Europe compared to US totals, but the fact that Americans have more vehicles per capita is probably one big factor.

[Source: just-auto, Blogging Stocks]

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    • 1 Second Ago
      • 8 Years Ago
      The corporate structure in Germany tends to have many prospective BMW/Audi/Benz customers in a company ride. It is often a cash allotment, and Benz's tend to be a little more pricey than the Bavarian brands.
      The statistic I'd like to see is which brands people over-reach for the most- income level vs vehicle price.
      • 8 Years Ago
      So companies buying cars for what is ultimately private use as you say may be stopping a lot of Japanese cars from being purchased by private owners and the Japanese companies don't have history and the deep discounts the Germans give to their fellow country companies.

      It is still fleet. And it changes the game (as to who would buy/drive what vehicle). And it keeps the factories open.
      • 8 Years Ago
      #4 100% correct...and funny as a employer I buy my private used Audi over my company..makes it a fleet sales to that article logic.. which is for sure nonsens.. most of that fleet sold Audi BMW are owned by the company owner(Germany economny strenght are the hundret thousend smale companys with less than 50 employees)...their owner bought the car for tax reason as a company car even if used only private.
      From that 60% fleet sales are for sure more than 50% bought only for private use. BTW currently the tax law is changed and many of that fleet cars get turned into private owned cars... the government cut the tax advantage for companys if the cars are not 100% used for company work... now it gets more expansive to buy a car for private use over your own company. Means in 5 years that statistic is completly different and the sales are still the same
      • 8 Years Ago
      Right, what all the others have said. Fleet sales in the US are nearly always to governments and rentals. Fleet sales in europe of mid-high range cars go to companies who supply them as company cars to their employees. Apples and Oranges indeed.
      • 8 Years Ago
      As has been said, company car sales are the reason. I've no idea what %age of BMW 320d's are company cars, but in the UK for example, I suspect almost all of them are. Incidentaly, company car recipients have to pay tax depending largely on the car's co2 output, which largely explains the success of diesels even amongst expensive cars in Europe.

      It is not true that this is "still fleet" in the same way as rental fleets, gov't fleets etc. though, since company car recipients, especially at the top end, usually get to choose what car they get - so it in a large part it does come down to desireability.

      A fact that is not always appreciated in the US or Japan is that European brands carefully develop their models to appeal to the company car market. For example, Audi and BMW's have developed their 4-cylinder diesels without increasing the capacity but instead investing heavily in turbo-charger tech etc., though expensive. Toyota, just for example, increased the capacity (to 2.2 liters)to increase the performance. Doesn't sound like a lot, but it pushes up co2 and means that if I wanted a Toyota company car I would have a pay a signficant tax penalty over an Audi, VW or BMW. Why would I do that?
      The phenomenon of sporting luxury cars with high purchase prices but 2 liter diesel motors is explained by a combination of market forces and regulatory enviroment.
      • 8 Years Ago
      ... now that we have kind of shot this article to Hell, lol:
      A more interesting point?????????

      What if the Big 2.5 cutback on fleet sales causes the rental companies to go with Korean (soon Chinese) cars? Will the lack of US cars to rent get Americans comfortable with the 2nd tier Asian brands?
      Will that rear drive large Hyundai end up being the Fire Chief's car in Peoria?
      Is the Meter Maid of 2010 going to be driving a Chinese car?

      I am suggesting that removing the ONLY presence of mainstream US boring sedans -- rentals -- in some markets (Los Angeles, for instance) may lead to the brands becoming weaker.
      Will the American brands first become niche brands, then disapppear? Anybody stupid enough to think that GM making Buicks in China is not likely to lead to our having only Chinese Buicks here?
      All the more reason to fix the UAW mess.
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