With the current state of the global economy, many businesses within all sectors around the world are struggling to make a profit. Well, known businesses are closing or going into bankruptcy almost every other day, so it is surprising to learn that car sales have remained strong. Particularly given the large expense associated with buying a new car. Recently, it came as quite a shock to many when BMW announced that 2012 was not only a profitable year but actually their most successful year ever. The question arises, how, in an age where money is tightly guarded by consumers, have brands like BMW managed to build on their success?
Easy Credit
There are a number of different ways in which people can buy a car now and most involve easy credit. Bank loans allow you to borrow money and pay it back (plus interest) in monthly installments and interest rates in the U.S. are currently being held below market rate by the FED. Plus, most car companies (including BMW) have their own financing arm that offers low rate loans to encourage buyers. Currently, BMW is offering 0.9% APR loans for 48 months. Even those who are turned away by conventional lenders can receive financial backing. Car loan companies help those who need support in securing extra cash to buy a new vehicle. This type of lender can get money for consumers in spite of a bad credit rating, no matter their circumstances, of course, it comes at the cost of higher interest rates.
Value for Your Money
One reason BMW is succeeding is that their cars are built to last. Due to their sturdy German engineering and design and the increased fuel economy of their vehicles, resale values remain high so the cost per mile of owning a BMW may not be much higher than owning a less “expensive” car.
Comfort is Still Important
Because of the amount of time spent traveling and the difference in comfort, people may be looking to cut corners where they can and save themselves some extra money but transport is evidently not an area in which many are willing to compromise. People will always need to travel to work; take their children to school; drive to the store to buy food; take the car across State to visit family and so on. Having become an integral part of everyday life, humans are reliant on their cars and once they become used to high-end features like heated leather seats, night vision to help detect objects up to 900 feet away, automatic high beams, blind-spot detection, head-up displays, and emergency call features, it seems a recession is not enough to get them to give them up.
Income Disparity
One feature of most modern recessions is that although some people lose their jobs those who retain them are really no worse off than they were before the recession. In fact, if prices fall but their salaries do not, they may actually be better off. However, in 2008, stock prices fell roughly in half and everyone felt poorer even if they retained their job, thus they cut back on spending. But now with the stock market rebounding the feeling of poverty is dissipating and although some people still have to scrape by, there will always be room for the lucrative performance car market. The recession may have devastated some businesses around the world but given the staying power of the car market so far, it seems the likes of BMW will have little to worry about if the recovery continues, as they will continue to reap the rewards of a booming market and a loyal line of customers.
See Also:
- Germany Will Exit Euro
- How the Golden Reset Button Could Drive the Price of Gold to $20,000.
- Determine Your Car Buying Budget Before you Shop for a Car
- 7 Fuel Efficient Cars Under $20,000
- Top 10- Nicest Affordable Cars
Recommended by Amazon:
- BMW Stuff
- The BMW Book
- Inside the BMW Factories: Building the Ultimate Driving Machine
- Driven: Inside BMW, the Most Admired Car Company in the World
- Premium Power: The Secret of Success of Mercedes-Benz, BMW, Porsche and Audi
Image courtesy of M – Pics / FreeDigitalPhotos.net
