Back in late 2010 and early 2011, when the all-electric Nissan LEAF and range-extended Chevrolet Volt debuted in the U.S., we were inundated with stories of dealer price-gouging. In some cases, dealers were adding upwards of ten or twenty thousand dollars on the price of new plug-in cars.
Since then, price-gouging — selling cars well above MSRP in order to cash in on high demand and low availability — has been mercifully absent for the most part. But now it appears price gouging is back, this time with the BMW i3.
We were first alerted to the problem by BMW ActiveE Electronaut Jack Spratt, who made a post on Facebook over the weekend complaining that his local BMW dealer was adding extras to its BMW i3 that customers didn’t want — then hiking the sticker price.
“What are we supposed to do when our center holds us hostage with inflated lease rates and dealer-mandated packages that we don’t want?” he asked. “I don’t really understand the mentality of these dealers. Just who do they think they are? They can’t even spell “i3″, refuse to be trained, know less about the process than we do, can’t service the car, will most likely not have an L3 charger, won’t provide EV loaners, but WILL fill my mailbox for years to come with postcards about my ‘1M Alpine White’.”
He’s not alone. We’ve heard instances of dealers inflating prices as much as $5,000 over MSRP for i3 customers who are new to the brand. With the BMW i3 not even hitting dealer lots, both lease and finance quotes are high too, cashing in on demand for both the all-electric i3 and its sibling, the range-extended i3 BEVx.
Spratt, who ordered his i3 electonaut special edition online, says that his local dealer is trying to add extra packages to the base-model i3, hiking the price in turn. As an electronaut, he has the option to opt out of these extras, but new customers without an ongoing relationship with BMW will have to no choice.
Worse still, the electronaut special edition package — added free by BMW for all of its electronauts who are buying an i3 — is being listed by many dealers as an invoice item.
BMW has said that eletronaut extras, while included on the invoice for appropriate tax and insurance purposes, are credited back to the dealer at the time of sale, negating the need to invoice the customer for these special-order, electronaut-only items. Yet some dealers are ignoring this final part and trying to invoice existing electronaut customers for them anyway.
“As an electronaut, we have ‘special powers’ to complain about such things,” Spratt told us earlier. “But for people who are purchasing outright, I think they are getting screwed.”
Further, says Spratt and other electronauts, BMW dealers are hiking the lease pricing well above the official BMW-suggested rates. On confronting his local dealer on markup of both the money factor and acquisition fee over BMW rates, he was told that he was lucky.
“We’re offering the i3 to our Eletronauts at no mark-up,” his dealer said. “We will not be leasing them at the buy-rate from the bank. Most dealers are asking $3-5k over MSRP if you came in as a new client.”
In other words, if you want one, put up with the inflated pricing.
Of course, price gouging isn’t new. It’s been around in the automotive world for as long as we can remember and is one of the reasons why we often advise waiting a few months between the launch of a new car and buying one. For those who have patiently waited through BMW’s often confusing pre-launch strategy though — not to mention a lack of HOV-lane and CVRP rebate eligibility for Californian i3 BEVx buyers — this is the final straw.
“In my post, where I mentioned that they were adding a couple thousand for no good reason, other dealers were doing the same. I would poll the non-electronauts,” he continued. “I can’t really cancel my order, or I lose my electronaut benefit, and I’d end up paying more if I ordered elsewhere (because we have a slight discount). So if I cancel, it would be to buy a Tesla instead!”
Spratt will likely carry on with his BMW i3 order. But if you’re in the market for an i3 and you’re not an Electronaut, you may want to wait a while before the price gouging dies down.
Have you seen inflated BMW i3 prices at your local dealer? Are you getting a good quote for finance? Let us know in the Comments below.
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