MUNICH, GERMANY - Bayerische Motoren Werke AG, the world’s largest maker of luxury cars, plans to
raise prices in the U.S. by one percent because of the weak dollar. The increase for cars such as the X5
SUV and 5-Series luxury sedan will take effect on Jun. 1, Markus Sagemann, a
spokesman for the Munich-based company, according www.bloomberg.com.
“It’s a
moderate price increase that reflects the conditions in the market,” Sagemann
said in a telephone interview with Bloomberg, adding that the last U.S. increase was in March 2007.
The
dollar’s drop hurts BMW because the company gets fewer euros for every car it
sells in the U.S. The dollar has fallen about eight percent against the euro this year. This
means that for a car like the 5-Series, BMW gets more than 2,000 euros ($3,150)
less now for each one it sells than it did at the beginning of the year. The
carmaker took a first-quarter charge of 236 million euros because of bad debts
and lower values on cars it sells in the United States after leases expire.
BMW,
which sold 22 percent of its cars in the U.S. in 2007, raised lease rates by
about 3 percent on May 1. Higher new car prices typically boost used car
values.
The
first-quarter charge led to a 17-percent drop in BMW’s net income for the first
three months. Four-month U.S. sales fell four percent to about 100,000 cars.
