Value of the BMW as a whole..... Rant......

So, I was totally shocked at how much my 2015 R1200RT is at trade in. Story is my wife and I want to do more exploring the AZ off road fire roads. And was looking at an adventure bike. The BMW dealer has a couple of choices, one of which is Aprilia. And is the least expensive. But was also shown the GS line and figure with having used BMW financing on our current bike, the financing might be a little more streamlined. So take the RT in and had them give me a indicator of what they will give on a trade in.... was..... well.... shocking...... 40% less than what we bought it for 18 months ago. Now I know I'm going to hear all the crap about losing money on trade-ins but I have been pretty lucky, it seems, with my last dealer getting me into a new bike despite only keeping the last one, also 18 months. In the past it just seemed like Beemer's held a resale better than most, but now I'm rethinking that logic for sure. The other side of this might be where we live now. While living in Central CA, trading in my 2015 Triumph Trophy, was given a pay off value. AND a bit of a discount on the RT. Some say it is because the dealers here in AZ (Phoenix to be exact) are really not motivated to sell bikes. Now I totally understand a dealer needs to make a profit with high costs of overhead now days......... But we are seriously disappointed in BMW's value. Period! My wife wants to move forward with the Aprilia and I say why not. We may even travel back to CA for our next purchase. I've got a call in to the last dealer we bought a bike from to see what is their thoughts...... Rant over....... Thanks for reading.

I understand your frustration. Forty percent is a sizable hit to take. Could the time of year be a factor in the low trade-in offer?

Bob

I'd respectfully suggest that if resale is important to you, and you're considering an Aprilia, something is amiss........

-MKL

Could very well be. 2017's will be out soon so who knows.

I've had Aprilia's in the past and they may have had a low resale value, but I could sell it with in 30 days. No problem. And if the BMW is taking a 40% hit, the Aprilia is not that far off either. As per Kelly Blue Book. I just thought BMW would hold a better resale thats all. As it stands, it's no better than any other motorcycle out there. So why pay a premium for a MC?

My 2016 KTM RC390 was my first new bike since 1984, and I was pretty much forced to buy new if I wanted that bike since it has only been on the market for two years. I've lost count of how many used bikes I purchased over the years. Cars, trucks, trailers...always used. To me the depreciation hit on a new vehicle is pretty much a huge waste of money, and like the motto of a used car dealer in Texas, "Everybody drives a used car."

The caveat of course is the need to finance. I've been fortunate to be able to buy outright which has resulted in some great deals. Even so, from what I understand, while it is a real convenience to just let a dealer handle everything, if the vehicle's loan value is reasonable then alternative financing is pretty easy to secure.

Dealers often hold all (or at least most) of the cards when it comes to some deals, unfortunately so.

Exactly!

Sounds a miss by some....traded in my 2005 on a new 2014. I got 58% of what I paid for the 2005 9 years later...and that was a trade in. I left something on the 05. I went back 2 days later and they had already sold the bike.

If you paid around $24ish and only get $14.5ish (60%), I wouldn't make that deal. You may be as you suggest in a market where that bike would be a slow sell for the dealer so they get a good bit more room for the float they will carry.

I suspect your best bet really is to back to Ca where the BMW market is generally strong if you want to trade...otherwise I would try owner sell for what you think is the right price and see what happens.

I wouldn't sell my 2014 for $14..

Both of the Phx BMW dealers have been mopped up by corporate players. I'm having awful results at both places -- repairs are sky-high, accessories are stupid expensive, and trade ins aren't worth dirt.

Some of my friends like Iron Horse in Tucson, but I wasn't impressed when I tried them -- they were less honest than the Phx bunch with me.

Maybe time to look at some other brands. (Heresy, I know.)

Have to look at the market, timing, dealer inventory ...

In Arizona you want to trade a touring bike for an adventure bike. Wrong time of the year and everyone seems to want an adventure bike these days. A dealer may have to sit on the RT for months. So you are paying for the interest on the dealer's showroom plan by a low trade value.

Also, if the dealer is practically sold out of GSs and has a dozen RT, RS and SS rides on the floor, he doesn't need/want another. You pay.

On the other hand, if you had a 15 GS and wanted to trade for a tourer, the dealer would probably be more willing. You win.

Please let us know how you make out in Kali. I'm sure the dealers there will offer you much more on the trade in. We will be waiting for the news.

I have watched what the new RT has been advertised for, as well as the price the sold ones went for. $14,000 range is what they bring. I paid $20,000 for mine, around 30% depreciation. Quite acceptable. New vehicles ( car, truck, bike, boat..) lose a disproportionate amount in the first couple years.

Not seeing all that many used RT-LC for sale. I think that is a good thing.

Don't overlook taxes on trade in vehicles. $14,000 at Texas' 6.25% tax rate is $875 you save in vehicle taxes when trading in.

I'd respectfully suggest that if resale is important to you, and you're considering an Aprilia, something is amiss........

 

-MKL

Exactly my thoughts. "Aprilia" and "resale" don't go in the same sentence.

I'll say here for the records: there are three kinds of resale values.

First is the real one, meaning what any good will go for in the real world.

Second is what your friend/cousin/colleague says he sold his car or motorcycle for.

Third is what locals here ask for any used chainsaw. I've seen an Echo CS600 advertised for exactly the same price as the local official dealership will sell exactly the same saw... with a five years warranty. And that's nothing compared to Stihl's.

I think the quick depreciation from the dealer is due, in some part, to BMW balloon financing on new bikes. Buyers are going to need a little bigger incentive to buy used when a new one is $233/month. Yes, there is a balloon payment at the end of 4 years for $10K. But, many folks will worry about that later or assume they'll trade it in/sell it for new at that point.

I'm basically a "used" guy for vehicles and bikes, but the financing is enticing.

Traded in a couple over the last two years. Dealer in Long Beach Ca (southern ca) goes strictly by Blue Book Trade-in value: typically a radical drop the first year. No dealing here. Selling private here is fine, but in the land of litigation and so many nuts, I'll take the big hit and trade-in usually. A trip to the lawyer and a few calls by him would easily make up the difference.

peace

Thanks all for your responses. All of you have very legit thoughts. As for now, the bike will still be our way of getting away. I just didn't expect a so called "premium" bike take such a hit. But again, as many have stated, it could very well be the dealer and the area. The search will continue but won't be a priority. If we do go to CA, I'll let you all know how it goes. We will be traveling there in the next two months.

In some respects you're comparing apples to oranges. You're comparing the retail price you paid to the wholesale price the dealer is offering you. Figure the dealer had about a 10-12% profit margin on your bike when you bought it. Now look at his original wholesale against his new wholesale. It's not 40%. Might still be a little stiff for you to take, but it's apples to apples.

Now let's go through your $14,000 trade-in. Does it need service work? Well, for a bike that's going to go on the sales floor at around $17,995, whether it needs it or not, it's going to get it. At least the basics. Oil, coolant, filters, final drive, and valves (if the mileage indicates). Why? Because any customer in the market for a used $18,000 motorcycle expects it to be Ready To Ride, as in "like new" except for the odometer. Oh, and don't forget tires. Unless you put some on in the past 1000 miles and the dealer has proof he can show a prospective buyer, a new set of tires might have to go on the bike in order to make it worth the asking price. And just because the dealer pays $275 for the tires doesn't mean they're not worth his regular $400 plus mounting when it comes to the wholesale price of the bike. Tires go in through the Parts Dept. which is its own business unit, and get sold to the Service or Sales Dept. at normal profit rates. Same for the work the Service Dept. performs on the bike. So, your $14,000 trade-in now has a wholesale value (cash paid plus parts/service) of $15,000.

The bike goes out on the floor at $17,995. That's going to get negotiated down by $1,000 - $1200 when purchased, due to competing inventory, BMW's attractive financing on new models, and what similar bikes are selling for, private party. So, the bike sells for $17K, leaving the dealer a gross profit of $2K. From that, there's the flooring costs, which is the interest on the money he continuously borrows from/repays to the bank in order to float his inventory (it doesn't matter if the bike sat on the floor 3 weeks or 3 months . . . it's cost averaged over the entire inventory). And then there's the salesman's commission. 20% - 25% of the profit is typical, so about $500 if you include the flooring costs. Now the dealer is at a net profit of around $1500, or about 10-12%, which is the same profit he makes on a new bike at full retail (which rarely happens). Yes, dealers make slightly better money on used bikes (percentage wise), but they take substantially greater risks on used bikes.

The numbers above are just for the sake of discussion, and not 100% representative of actual transaction values, nor are they representative of the financial situations at every dealer. YMMV.

I agree that there is great satisfaction in buying a "new" motorcycle. But there is also a price attached to that satisfaction. In the long run, it gets amortized over the years of ownership, the miles ridden and the joys experienced. And that validates the initial depreciation to many people, or new vehicles simply would not sell. However, if you're someone who gets the itch for something "new to you" every 18 months, wait for the guys who get the itch for something "brand new" every 18 months, and pick up one of theirs.

Oh, and if you want to cry, check out what a new Mercedes S Class is worth after 18 months.

Bingo!

I did take all you said into consideration. A long talk with the salesman answered all my questions outlined in your comments. They know the bike, have done all but one service on it and yes, tires were just installed 600 mile ago. The bike is perfect (as per the salesman) and I get wholesale vs retail, mind you I have been in retail business for 15+ years owning the business. Point is........ As a motorcycle brand....... These bikes are advertised as a premium brand, as is their cars...... And if they lose that much value in such a short time, l very seriously doubt I'll be buying another one. The cost of ownership along with a $9000 loss, forget it..... I took way less a hit when I traded in my 2014 Triumph Trophy on the BMW...... Just saying.....

It is a matter of what the market will bear, and a negotiation between the seller who wants to receive as much as possible and the buyer who wants to spend as little as possible.

I recall the issue with Audi owners some decade or so ago wanting to sue Audi because they were not getting their what they called their investment dollars out of the sale of their used cars...sorry, but GMAFB.

If one can't afford the expense of a toy, then maybe it is a mistake to own it.

[quote

If one can't afford the expense of a toy, then maybe it is a mistake to own it.

Truer words were never spoken.

If you want to get closer to retail, you're going to have to bite the bullet and market it yourself.

Just as a point of comparison, I bought a two year old RT from a local BMW dealer this spring. The advertised price was $17,995 and I got it for $17,000. You're essentially looking at the other side of the equation. If the '17s aren't out yet, they're close to it, so I'd expect that the dealer will end up offering your RT at about the same price I paid.

I'd also note that it's apparently not so easy for dealers to resell used motorcycles. When my sales rep took me back to show me my RT, we went to a building with, I'd estimate, around 200 used bikes in it. They move a lot of units, but I was a little surprised . . . there's a considerable cost in all this used inventory.

If you do sell it yourself, while I haven't been monitoring the market for a few months now, I'd guess you could get around $17,000-$18,000 for it. As Fernando notes, there are expenses for the dealer in re marketing your bike, so it sounds like they're at least in the ballpark. I'd expect that you'd see a similar level of depreciation for any brand.

As a motorcycle brand....... These bikes are advertised as a premium brand, as is their cars...... And if they lose that much value in such a short time...

I get that it's a gut-wrenching amount of money for those of us without lots of disposable cash, but I think you're missing two things. First, as stated above, you're not really losing $9000 in value because you're comparing the retail price to a consumer to a wholesale COST to a seller. You'll get more if you sell it yourself (but to do that, you have to put in the dealer's work - which is what some of that money you're losing pays for).

The second is that, in my experience (based on opinion, mind you), premium vehicles lose MORE value coming off new. Why would that be? Premium vehicles are marketed to, and sort of only obtainable by, people who can afford to take that kind of a perentage hit REPEATEDLY and are willing to do so to have the newest, latest, greatest. A large percentage of your new premium vehicle buyers don't want a used car, even if to me - and maybe you - a BMW with only 5k on it (car or bike) that looks spotless and is dealer maintainned LOOKS like new, it still isn't to them.

I LOVE the precipitous drop in value of things like that, because it means after five or ten years it gets down to MY price point, and -usually- it's still a pretty great vehicle and suddenly valued at the same level of similar aged/slightly newer vehicles that are far less desirable (to me). (Another factor of course is that mystique that BMW/Audi/MB are ticking time bombs of expensive repairs and you'd better never buy a used one because you won't be able to afford to keep it running.

And all of this, and all the above comments don't help you feel better at all, and I guess for that maybe we're not being very good friends - we should all just say, man - that sucks, stupid dealer! (And then offer to buy your bike for $1000 more than they offered ). ....but it's a BMW board with a bunch of analytically minded folks, so .... :)

Oh, and for those of us poor folk on here, maybe we're just a little jealous of folks who can buy new ones and then turn around want to buy ANOTHER new bike the next year...my newest BMW is still almost twenty years old, only cost me $3k, and I'm pretty sure I could sell it for that tomorrow (though I bet the dealer would offer me WAY less too ).

In any case, if you can afford a motorcycle at all, especially one at that level, don't forget that you're so far better off than most of the folks in this world.

josh

So, I was totally shocked at how much my 2015 R1200RT is at trade in. Story is my wife and I want to do more exploring the AZ off road fire roads. And was looking at an adventure bike. The BMW dealer has a couple of choices, one of which is Aprilia. And is the least expensive. But was also shown the GS line and figure with having used BMW financing on our current bike, the financing might be a little more streamlined. So take the RT in and had them give me a indicator of what they will give on a trade in.... was..... well.... shocking...... 40% less than what we bought it for 18 months ago. Now I know I'm going to hear all the crap about losing money on trade-ins but I have been pretty lucky, it seems, with my last dealer getting me into a new bike despite only keeping the last one, also 18 months. In the past it just seemed like Beemer's held a resale better than most, but now I'm rethinking that logic for sure. The other side of this might be where we live now. While living in Central CA, trading in my 2015 Triumph Trophy, was given a pay off value. AND a bit of a discount on the RT. Some say it is because the dealers here in AZ (Phoenix to be exact) are really not motivated to sell bikes. Now I totally understand a dealer needs to make a profit with high costs of overhead now days......... But we are seriously disappointed in BMW's value. Period! My wife wants to move forward with the Aprilia and I say why not. We may even travel back to CA for our next purchase. I've got a call in to the last dealer we bought a bike from to see what is their thoughts...... Rant over....... Thanks for reading.

Which dealer was it? GOAZ wouldn't surprise me at all. Parson's has a unique way of doing business. Someone has to pay for those digs...Victory now RideNowEuro is more laid back, but I've never talked to their salesmen much, just the service people. It might be worth a ride to Ironhorse in Tucson. I haven't heard anything bad about them, but I have of the others.

Both of the Phx BMW dealers have been mopped up by corporate players. I'm having awful results at both places -- repairs are sky-high, accessories are stupid expensive, and trade ins aren't worth dirt.

 

Some of my friends like Iron Horse in Tucson, but I wasn't impressed when I tried them -- they were less honest than the Phx bunch with me.

 

Maybe time to look at some other brands. (Heresy, I know.)

Seems that Ride Now owns a lot of the dealers in the valley of all types, so what's the advantage of going to one or the other? There are independent ones, like Desert Winds HD, but they are far as few in between. I could always go back to the dealer in Iowa I bought mine from. He doesn't sell the beemers quickly and deals can be made. Another dealer that works things out is countryside in Ill. Mike Abt is known to deal. Some people like Max in NY/NH/CT. Fly and ride might not be so bad. I wouldn't buy from the local BMW dealers here in PHX.

In some respects you're comparing apples to oranges. You're comparing the retail price you paid to the wholesale price the dealer is offering you. Figure the dealer had about a 10-12% profit margin on your bike when you bought it. Now look at his original wholesale against his new wholesale. It's not 40%. Might still be a little stiff for you to take, but it's apples to apples.

 

Now let's go through your $14,000 trade-in. Does it need service work? Well, for a bike that's going to go on the sales floor at around $17,995, whether it needs it or not, it's going to get it. At least the basics. Oil, coolant, filters, final drive, and valves (if the mileage indicates). Why? Because any customer in the market for a used $18,000 motorcycle expects it to be Ready To Ride, as in "like new" except for the odometer. Oh, and don't forget tires. Unless you put some on in the past 1000 miles and the dealer has proof he can show a prospective buyer, a new set of tires might have to go on the bike in order to make it worth the asking price. And just because the dealer pays $275 for the tires doesn't mean they're not worth his regular $400 plus mounting when it comes to the wholesale price of the bike. Tires go in through the Parts Dept. which is its own business unit, and get sold to the Service or Sales Dept. at normal profit rates. Same for the work the Service Dept. performs on the bike. So, your $14,000 trade-in now has a wholesale value (cash paid plus parts/service) of $15,000.

 

The bike goes out on the floor at $17,995. That's going to get negotiated down by $1,000 - $1200 when purchased, due to competing inventory, BMW's attractive financing on new models, and what similar bikes are selling for, private party. So, the bike sells for $17K, leaving the dealer a gross profit of $2K. From that, there's the flooring costs, which is the interest on the money he continuously borrows from/repays to the bank in order to float his inventory (it doesn't matter if the bike sat on the floor 3 weeks or 3 months . . . it's cost averaged over the entire inventory). And then there's the salesman's commission. 20% - 25% of the profit is typical, so about $500 if you include the flooring costs. Now the dealer is at a net profit of around $1500, or about 10-12%, which is the same profit he makes on a new bike at full retail (which rarely happens). Yes, dealers make slightly better money on used bikes (percentage wise), but they take substantially greater risks on used bikes.

 

The numbers above are just for the sake of discussion, and not 100% representative of actual transaction values, nor are they representative of the financial situations at every dealer. YMMV.

 

I agree that there is great satisfaction in buying a "new" motorcycle. But there is also a price attached to that satisfaction. In the long run, it gets amortized over the years of ownership, the miles ridden and the joys experienced. And that validates the initial depreciation to many people, or new vehicles simply would not sell. However, if you're someone who gets the itch for something "new to you" every 18 months, wait for the guys who get the itch for something "brand new" every 18 months, and pick up one of theirs.

 

Oh, and if you want to cry, check out what a new Mercedes S Class is worth after 18 months.

If the dealer is honest. I've heard stories on one dealer here where they didn't touch the bike and there were problems. Not good. I wouldn't assume a dealer doesn't anything other than clean the bike. Just saying. In an honest world, you make sense. For instance, a co-worker several years ago traded his dodge ram 2500 with 56K miles. It was a 1999 and the toyota dealer gave him 5000K and literally the next day it was on the lot for 10,999. The margin is so much better on used vehicles.

It is a matter of what the market will bear, and a negotiation between the seller who wants to receive as much as possible and the buyer who wants to spend as little as possible.

 

I recall the issue with Audi owners some decade or so ago wanting to sue Audi because they were not getting their what they called their investment dollars out of the sale of their used cars...sorry, but GMAFB.

 

If one can't afford the expense of a toy, then maybe it is a mistake to own it.

It's a matter of what the salesmen thinks he can get away with.

The best way to deal with these people is to make an offer. Have your financials ready before hand and it's only about cash/numbers. Make it fair to everyone by doing research. Make the offer saying if you want a deal, I'll do it for this today. Give me a call if you have to think about it and leave if that's the case. It's worked for me. No 4 square BS, no assumptive close or ben franklin or appeal to a higher authority. Either the want to deal or they don't.

You're confused by equating your trade in offer with the value of the bike.

The offer is the number the dealer needs in order to make a profit when it resells your bike at ... its value.

You could maybe get that value, too, if you executed a private sale.

The difference is the cost you pay for the convenience of having the dealer take the bike and your not having to do all the work to sell it yourself. Every service you receive costs something.

Logic rears it's head!

Yep! If ya wanna play ya gotta pay.

well when I looked at just selling mine the dealer suggested I sell it for 14.5, but I won't. It will go out there for 16.4 (has nav+ old 49l top case + darlas) and will see how I fare.

amazing how much BMWs tank

well when I looked at just selling mine the dealer suggested I sell it for 14.5, but I won't. It will go out there for 16.4 (has nav+ old 49l top case + darlas) and will see how I fare.

 

amazing how much BMWs tank

Most other brands would have gone up in value after they were used.

I've bought all my BMWs used, (approx.8 of them over the years). Most bought from the owner, a couple from a dealer. A couple years ago an RT bought from a dealer, it being only 1 model year old and very low miles, I got it for 30% off its original MSRP. I generally like to buy a 1 year old low mileage bike and always have gotten it for between 25-30% less than it's MSRP.

I agree that that trade in figure of 40% was an insult, unless you brought it to them with high mileage and never cleaned it since you owned it.

A dealer does have many expenses to pay for to stay in business, and has to pay you and then risk having it sit on his showroom floor a while until it is sold. The particular model and location may also come into play. Does he a half dozen of your model already on his floor, or is it a model that's in demand locally that he thinks he can sell in under a week, has a lot to do with his offering price.

Or, he's just a lying scheming douche bag, but they don't usually remain in business for long.

well when I looked at just selling mine the dealer suggested I sell it for 14.5, but I won't. It will go out there for 16.4 (has nav+ old 49l top case + darlas) and will see how I fare.

 

amazing how much BMWs tank

All toys depreciate quite a bit as soon as you cross the sidewalk in front of the dealership.

well when I looked at just selling mine the dealer suggested I sell it for 14.5, but I won't. It will go out there for 16.4 (has nav+ old 49l top case + darlas) and will see how I fare.

 

amazing how much BMWs tank

 

All toys depreciate quite a bit as soon as you cross the sidewalk in front of the dealership.

Some worse than others

If you want to see depreciation, try buying a Ducati!! Great bike to ride, well engineered, but no resale.

So lesson learned it seems. Thank you all for your input.... We will be putting more miles on the RT, just not off road at the moment.

If you want to see depreciation, try buying a Ducati!! Great bike to ride, well engineered, but no resale.

Yes...they're a great bike to buy on the resale market. Generally very low miles and significant depreciation.

If you want to see depreciation, try buying a Ducati!! Great bike to ride, well engineered, but no resale.

 

Yes...they're a great bike to buy on the resale market. Generally very low miles and significant depreciation.

I couldn't agree more! It's amazing how much bike a person can buy for 3 to 5k these days.

If you want to see depreciation, try buying a Ducati!! Great bike to ride, well engineered, but no resale.

 

Yes...they're a great bike to buy on the resale market. Generally very low miles and significant depreciation.

 

I couldn't agree more! It's amazing how much bike a person can buy for 3 to 5k these days.

Yes, it seems that no matter the original MSRP, everything seems to bottom out at 3K unless it's really high mileage or rough shape, then it seems 2K is it. Just my observation.