BMW pays $800 million to dealers in China as stocks pile up
05/01/2015
On January 5, BMW agreed to pay rebates totalling $820 million to its dealers in China to compensate them for what Reuters called “the cost of over-stocked showrooms” in 2014.
Dealers stocked up on cars in anticipation of better growth than the 7% the Chinese automotive industry is expected to announce for last year.
“Many automotive dealers in China experienced pressures and challenges from the market in the second half of 2014,” BMW said in a statement.
Growth of 7% would indicate sales of 19 million new cars from all manufacturers in China for 2014, but the rate of growth would represent a decline of 50% compared to 2013. The Chinese Automotive Dealers’ Association has made it clear other brands face compensation claims too.
Share this story:
