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Dealers mobilize to protect their margins from automaker subscription services

Six individual auto brands — Lincoln, Cadillac, Porsche, Mercedes, BMW and Volvo — have established or are trialing a vehicle subscription service in the U.S. Three third-party companies — Flexdrive, Clutch and Carma — run brand-agnostic subscription services. And three automakers — Mercedes-Benz, BMW, and General Motors — have also launched short-term rental services. Dealers, afraid of how these trends might affect their margins, are building political and lawmaking campaigns to protect their revenue streams. So far, three states are investigating automaker subscriptions, and Indiana has banned any such service until next year. It's certain that those three states are the first fronts in a long political and legal battle. Powerful dealer franchise laws mandate the existence of dealers and restrict how automakers are allowed to interact with customers to sell a vehicle. On top of that, Bob Reisner, CEO of Nassau Business Funding & Services, said, "Dealers and their associations are among the strongest political operators in many states. They as a group are difficult for state politicians to vote against." In California earlier this year, the state Assembly debated a bill with wide-ranging provisions to protect against what the California New Car Dealers Association called "inappropriate treatment of dealers by manufacturers." One of those provisions stipulated that subscription services need to go through dealers, but that item got stripped out when dealers and manufacturers agreed to discuss the matter further. In Indiana, Gov. Eric Holcomb signed a moratorium on all subscription programs by dealers or manufacturers until May 1, 2019, to give legislators more time to investigate. Dealers in New Jersey have taken their campaign to the state capitol, asking that the cars in subscription programs get a different classification for registration purposes. Automakers run the current subscription services and own the vehicles. Sign-ups and financial transactions happen online or through apps, leaving dealers to do little more than act as fulfillment centers to various degrees, with little legal recourse as to compensation amounts when they're called on to deliver or service a car. That's a bad base to build on for business owners who've sunk millions of dollars into their operations.

2014 BMW i3

We can only imagine the challenges BMW is going to have explaining the i3 electric vehicle to the world. It's got a new powertain (all-electric, with optional range extender), a new production method (carbon fiber reinforced plastic!), a new brand (the 'i' line) and a new vehicle type (it's a city car). Despite everything that's different, BMW is still trying to talk about the i3 as if it fits in with the rest of the company's vehicles. But it doesn't. Not really. And that's going to make the marketing and salespeoples' jobs quite difficult.
Which is a shame, really, since the i3 is amazing. If it didn't carry the BMW 'heritage' baggage, people would be falling over each other to sing its praises. This is one of the smoothest, roomiest and slickest electric vehicles we've ever driven, with a lot of hidden surprises. It is a wonderful city car, and well designed for the car-sharing, emissions-aware drivers of the near future. But since the i3 carries the BMW name, everyone we ran into while cruising the narrow streets of and flat countryside around Amsterdam in a Euro-spec i3 recently wanted to know one thing: is it "a BMW" as well as being an electric car? During one photo shoot, a police car pulled up next to us, totally stopping traffic. While my co-driver and I instantly thought we were going to be asked to move, the officer simply wanted to know what the scoop was about all the i3s he had seen that day. Oh, and does it drive like a BMW?
We'll answer that question in detail below. The most important thing to remember is that the BMW i3 comes from the new "i" sub-brand within BMW. Like Mini, the i line really is a different beast, despite the roundel's presence. So, what makes a BMW a BMW? The answer is as easy as ABC. Or, in this case, as simple as Bayerische Motoren Werke, or Bavarian Motor Works.

These are KBB's Top Ten Green Cars for 2015

For the second straight year, the Top Ten Green Cars list from KBB (i.e. the acronym for Kelley Blue Book) should have been retitled KBBimmer. That's because the BMW i3 electric vehicle has topped KBB's list of greenest production vehicles for two years running. That means that having the lowest purchase price wasn't that big of a factor in determining the winner. KBB releases its list about this time of year every year in honor of Earth Day and this year not only praised the Bimmer for its performance and single-charge range, but also noted that its factory is powered by wind turbines, which gives the car and the company a few more treehugger points. Meanwhile, KBB didn't exactly surprise a ton of people by including models like the Chevrolet Volt extended-range plug-in (with a caveat that the next-generation version will be coming out next year), Nissan Leaf and Tesla Model S EVs and the Toyota Prius' four hybrid variants. Other somewhat lower-profile advanced-powertrain models to make the cut were the Honda Accord Hybrid, Toyota Camry Hybrid, Volkswagen e-Golf and Ford C-Max Hybrid. Rounding out the list was the Volkswagen Jetta TDI, the only diesel that KBB recommended as a Top Ten pick. Related Video: Featured Gallery 2014 BMW i3: First Drive View 33 Photos News Source: KBBImage Credit: Drew Phillips Green BMW Electric top 10