Well gents, think about it.
In the current climate, car sales have collapsed, while significant fixed costs have stayed in place (factories and so on).
The consumer simply is not buying cars, particularly in Europe and the states where the equity crisis hit the hardest.
So, here you sit, gazillions in fixed costs, yet your not pushing sales revenue on new car sales, so close your doors, or up service parts.
As the consumer is no longer purchasing cars, and stuck in a negative equity situation on that expensive car he bought when liquidity and risk appitite was in plenty, he will still need parts, no 2 ways about it, so substitute revenue by upping service parts.
The other thing as well that you all need to keep in mind is transport costs, since the drop off in world consumption, fewer and fewer ships/planes have been circling the globe, yet fixed costs on the ships/planes stay the same, so what did the industry do.. Raise the prices.
Then you have all of the entities inbetween that adapt the same logic.
It really is a vicious cycle.
Dont get me wrong, I am not defending BMW here, something as idiotic as a badge which has a manufacturing cost of a couple of EUR cents due to economies of scale should not come close to those prices, but this is why parts have almost doubled.
That master cylinder for my E34 was 12k form BMW... 12 fscking grand for a cylindrical tube with a couple of valves and some rubbers.. manuf costs could not have been more then EUR 30, and as the part is still current in the ATE part range, how do you get from that to 12k retail with a 25% discount.
One would expect that safety equipment such as brakes would follow a cost leadership strategy to protect brand image, but noooooooo...
