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Automakers paying Chinese dealers for lower-than-expected sales

The Chinese dealers vs. foreign manufacturers story won't quit. It began with a story on the struggles faced by FAW-Toyota joint venture dealers, with supposedly 95 percent of the showrooms losing money, and 10 percent of them doing so poorly that they'd have to exit the business. The problem is mandated sales targets, most set when the country's economy was racing. Now that things have slowed, China's dealers are swimming in unsold cars and the costs to keep them. In the case of FAW-Toyota, dealers asked Toyota to hand over 2.2 billion yuan ($355 million) to help address the situation. That was followed by a report noting the issues that Honda, BMW, and Nissan dealers are having with the same issue, revealing that the Chinese Automobile Dealers Association (CADA) had taken the highly unusual step of writing to the Chinese government to complain. Now Reuters reports that CADA is not only pressing its case even harder, it's being open about it: it announced that BMW agreed to pay dealers 5.1 billion yuan ($820 million) to alleviate poor profits last year. Unnamed sources said Audi has thrown 2 billion yuan into the kitty for subsidies, and Daimler has contributed "about 1 billion yuan" to its dealers. The battle isn't just about 2014, but how business will be run in 2015 as well: Chinese Porsche dealers have requested the automaker lower its 2015 target of 64,000 cars, which would be a 40-percent increase on its 2014 sales of 46,931 vehicles. One analyst called it "shocking" that the CADA has taken its fight public, while CADA comments continue to imply that dealers have been railroaded to the cliff's edge without recourse. "Due to the difference in status," it's deputy secretary said, "individual dealers are not willing to, or don't dare to, talk frankly with the carmakers...." Both parties need one another, so they'll figure out a way to make it work – but that could mean acknowledging the Chinese market is behaving more like a mature one, not an emerging one. News Source: ReutersImage Credit: Lintao Zhang/Getty Images Earnings/Financials Audi BMW Porsche Toyota Car Dealers Luxury

2015 BMW X6 M First Drive [w/video]

Please forgive my bluntness, and allow me to cut to the heart of the X6-dissenter argument right at the top. Yes, BMW will sell you a 2015 BMW X5 M that is the motive twin (I assume) of the X6 M you're here to read about, that is also cheaper, roomier, and more conventional in appearance. For many of you – especially the old guard that hears the descriptor "Sports Activity Coupe" and proceeds to unlock the gun cabinet – that's all you need to hear. Because, although the fickle community that consumes and comments on internet car culture seems to be fine with typical-looking SUVs and wagons packing performance-enhancing goodies, the idea of slanting the back of one turns them right off. And yet, BMW continues to sell the things; more than 250,000 units have be delivered in the X6 series' history. As if that weren't proof of concept enough, blood-rival Mercedes-Benz has unleashed the GLE, a coupe-like crossover of its own, complete with AMG pedigree. All of this brought me to Austin, TX, home of Hill Country, The Circuit of the Americas and the 2015 X6 M launch. On both road and track I found a car that was more powerful and blithely capable than ever, while also being exactly as weird to drive as it is a concept to comprehend. Given that the X5 M exists, and offers styling that is more like normal for the SUV genre, both the lovers and the haters of the X6 M are likely to be focused on the way it looks. Here, the 2015 model isn't very much changed from the original, meaning you aren't liable to change sides on the styling debate for this refresh. The '15 model has a slightly fewer black accents on the exterior, along with revised front and rear fasciae and vented (and chromed) front fender gills. The car is almost two inches longer than the existing model, but is near enough the same size in every other direction that you'd have to study the specification sheet to know different. Inside the X6 M that I tested was a beautiful, fully optioned cabin that boasted gripping sport seats and BMW's wide, easy-to-read infotainment screen. The leather-wrapped everything and carbon-fiber trim were both well executed, and my hands rejoiced at the feeling of the thick-rimmed, serious-looking steering wheel. Veterans of the current M5 or M6 will see a lot that looks familiar here, but to my eyes that's high praise. The most impactful changes aren't visual but visceral.

BMW considering building 3 Series in North America

There might be even more BMWs coming from North America soon. The company recently announced plans to build a flagship crossover called the X7 at its Spartanburg, SC, factory. Now, rumors are emerging that the Bavarians might be thinking about building a second North American factory that could build its quick-selling 3 Series.
According to Bloomberg, the German luxury giant is considering several possible locations for a North American factory, including two in Mexico, that may build the 3. "We will decide this in the next months. On the North American continent, there's still potential," said BMW production boss, Harald Krueger, in an interview meant for company staff obtained by Bloomberg.
If BMW decides to open a plant in Mexico, it would be following its rival Audi, which already announced construction of a factory there. Mercedes-Benz has been rumored to be working on a deal with Nissan to build its cars South of the Border as well. Rumors of Bimmer considering Mexican production have also cropped up in the past, so it wouldn't come as a total surprise to hear it made official.