BMW will likely spend the rest of the first half of this year liquidating inventories in the U.S. as it attempts to reduce a heavy stock overhang stemming from the end of last year, when it edged out Mercedes-Benz and Lexus for the U.S. luxury sales crown.
Comments from BMW executives confirm bearish remarks made by major dealership groups that said cars such as the 3 series were sitting on showroom lots, declining in value with each day.
"We are adjusting our production plans and reallocating more SUVs to the U.S.," CFO Friedrich Eichiner told analysts last week, repeating plans to lift the share of light trucks sold -- such as the X5 -- to 40 percent from last year's 33 percent. "The fourth quarter was not as strong as expected, and we took a decision early on to clean up inventories to prepare for maybe a flatter market. That is what we are doing, and we think it should come to an end in the second quarter."