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post #1 of 18 Old Sep 23rd, 2009, 3:23 pm Thread Starter
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DeSimone BMW

Word is they are schedule to drop BMW in November. With many hundreds of BMWs in South and Central Jersey this is the last dealer. At this point, I ride to Desimone from Ocean City, MD for service. Does BMW really expect folks to buy such expensive new bikes without local dealer support?
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post #2 of 18 Old Sep 23rd, 2009, 7:23 pm
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Re: DeSimone BMW

I bought my bike from them. Was not happy with the last service they did for me and have not been back for over a year. This is the first I have heard they are closing. ?? I would think Bobs BMW is a comparable ride for you?

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post #3 of 18 Old Sep 23rd, 2009, 7:36 pm Thread Starter
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Re: DeSimone BMW

You are right. Bob's is about the same distance. I am originally from South Jersey and always got my bikes and service from Rob at RK. When BMW forced him out of business, he went to work at Desimone.
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post #4 of 18 Old Sep 23rd, 2009, 7:50 pm
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Re: DeSimone BMW

Last week I heard that BMW is looking for a dealer in SE PA and rumor has it that it could be Montgomeryville Honda/Suzuki.
I'm happy with Hermy's.
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post #5 of 18 Old Sep 23rd, 2009, 10:30 pm
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Re: DeSimone BMW

I thought there was a fairly new dealer on Rt. 70 in Cherry Hill, NJ?

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post #6 of 18 Old Sep 23rd, 2009, 11:09 pm Thread Starter
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Re: DeSimone BMW

Rte 70 dealer moved to Mt Laurel and became Desimone.
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post #7 of 18 Old Sep 24th, 2009, 8:12 am
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Sign of the times

Well. that sucks - but on the other hand, it may be a realistic state of things. I do not know how many bikes a dealer like DeSimone sells, but if you think about it, it takes a lot of cash to pay for staff wages, for building and - depending on their deal with BMW - for bikes' floor charges. Will even a thousand-dollar profit from 5 bikes a week pay for a dealership (especially as fancy as the DeSimone place)? Probably barely.

It could be that the number of motorcycles sold by BMW stateside can only support a fairly small dealer network. Yes, it is the chicken vs. egg question, but in today's economy corporate priority may be not in increasing bike sales. Mothership's car business is hurting, too - I even read some opinions that the "boutique" brands like BMW and Porsche may not survive this decade on their own. In the case of Porsche it is almost the case: it was just recently announced that VW may buy it (even though, interestingly, Porsche is a major VW stakeholder).

In any case, BMW may not be able to support a better network of US dealers, whether we like it or not. Dealers are expensive: note that the first thing to be shed as a result of GM and Chrysler bankruptcy was a large number of their dealers.

That's of course bad news for the consumers; in BMW Motorrad case, where I live, there is only Cross Country in Metuchen and BMW of Mahattan, both a long hike away. Places that existed fairly nearby are gone: Garden State BMW in Ledgewood, Touch of Class in Philipsburg. Max BMW was making noises last year about opening a place in Paramus on Rte 17; no doubt that is now on hold.

Oh, well... sign of the times.

Robert in Northern NJ

'09 R12GS, '08 R12RT, '03 R1150RT, '01 F650GS - time to thin the herd?


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post #8 of 18 Old Sep 24th, 2009, 10:54 am
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It's even worse than I thought

OK, being obsessive-compulsive, I kept thinking about the numbers surrounding the future of BMW motorcycles in the US. I spent some time trying to discover actual numbers that would shed some light on the importance of motorcycle sales to the company.

Here is what I found: from manufacturer's point of view, bike sales are just a drop in the bucket, a minor annoyance at best. In 2007, BMW made about 1.5 million cars, generating about 53 billion Euro in sales. At the same time, it manufactured about 100 thousand motorcycles, equivalent to 1.2bn Euro in sales.

The two largest markets for BMW motorcycles are, unsurprisingly, Germany and Italy. In terms of US market, there were about 12,000 units registered in 2008. There are about 140 dealerships nationwide.

Do the math yourself - the results are not pretty: on average, each dealer sells less than 2 bikes a week! I actually have no idea how they survive. I guess, the real income is from service and sales of parts and accessories. Think of that next time, when complaining about the cost of parts, compared with mail-order shipped from China.

What does this all mean, in my eyes:

- for BMW, motorcycle business is not really significant. One could argue that it is a "loss leader", kept on for prestige. As BMW is involved in perennial struggle against that other German brand in the luxury passenger car market, they may want to be able to say: "Our other products are exotic, sexy, adventurous vehicles - motorcycles. Theirs - trucks!". Just a thought...

- for us, the consumers, this is just a confirmation that we are riding rare products of an obscure brand. We may as well get used to the idea of very scarce dealer-network support, since the economics of the situation are fairly obvious. That is why the peer support of the BMW riders - like this forum - is so important and so useful.

Just some more of my 2 cents...

Robert in Northern NJ

'09 R12GS, '08 R12RT, '03 R1150RT, '01 F650GS - time to thin the herd?


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Last edited by rdwalker; Sep 24th, 2009 at 11:15 am.
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post #9 of 18 Old Sep 24th, 2009, 11:32 am
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Re: It's even worse than I thought

Excerpt from this link:
http://www.webbikeworld.com/Motorcyc...statistics.htm


BMW Reports Q1 2009 Sales Figures

April 19, 2009 - BMW Motorrad reported that sales were lower in the first quarter of 2009 when compared to 2008. Sales were 18.1% lower in the first quarter of 2009, with 17,232 units sold compared to 21,046 in the first quarter of 2008.

9,100 motorcycles were delivered to customers in March of 2009, which is 18.0% fewer than in March of 2008, with 11,093 delivered. BMW was also reported to have said that their future growth will come in the U.S. market, because the European market is "saturated".

It is unclear how BMW will do this; their strategy is still focused on having fewer dealers. The BMW motorcycle dealer network currently totals 140 in the U.S., and some markets are very much under-served. BMW reports that 65% of current dealers also sell motorcycle brands other than BMW, while 35% are exclusive BMW dealers.

BMW sources also told us that their motorcycles are priced lower in the U.S. than in any other country, but dealer profit margins are also lower.

Ted

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post #10 of 18 Old Sep 24th, 2009, 12:31 pm
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Re: It's even worse than I thought

Yes, I saw that press release on BMW Motorrad site. Unfortunately, it does not show US sales numbers, only worldwide, but nevertheless I did find some items quite significant - I am highlighting these in your quote.

Quote:
Originally Posted by Ted
BMW Reports Q1 2009 Sales Figures

April 19, 2009 - BMW Motorrad reported that sales were lower in the first quarter of 2009 when compared to 2008. Sales were 18.1% lower in the first quarter of 2009, with 17,232 units sold compared to 21,046 in the first quarter of 2008. (rdw edit: worldwide.)

9,100 motorcycles were delivered to customers in March of 2009, which is 18.0% fewer than in March of 2008, with 11,093 delivered. BMW was also reported to have said that their future growth will come in the U.S. market, because the European market is "saturated". rdw edit: it's going to be hard to compensate for EU market slowdown, since it accounts for at least half of the sales.)

It is unclear how BMW will do this; their strategy is still focused on having fewer dealers. The BMW motorcycle dealer network currently totals 140 in the U.S., and some markets are very much under-served. BMW reports that 65% of current dealers also sell motorcycle brands other than BMW, while 35% are exclusive BMW dealers.

BMW sources also told us that their motorcycles are priced lower in the U.S. than in any other country, but dealer profit margins are also lower.

Robert in Northern NJ

'09 R12GS, '08 R12RT, '03 R1150RT, '01 F650GS - time to thin the herd?


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post #11 of 18 Old Sep 24th, 2009, 8:56 pm
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Re: DeSimone BMW

Quote:
Originally Posted by rkimmel2
You are right. Bob's is about the same distance. I am originally from South Jersey and always got my bikes and service from Rob at RK. When BMW forced him out of business, he went to work at Desimone.
I am about the same distance from DeSimone, Bob's and Hermy's and went to DeSimone because of Rob as well. Here is my rant for what its worth...

The last time I went Rob was pushing paper and some other guy (who Rob said was very good) was going to do the 24K service. Rob did take the time to identify that I had the original rear brake rotor and recommended I take advantage of the TSB to replace it with a new version that does not squeak or rattle. Did not have to ask me twice on that one! Turned out the rotor was back ordered from GE and took over 3 weeks to come in. They had the bike apart some where at their shop and told me keep the loaner. After a couple weeks I was insistent they put the bike back together and let me come back when the rotor came in.

I picked up the bike and it was a not as it was when it went in. It ran fine but the stingray and side faring were not aligned and there was large gap in the joint at the top. I made a comment and two tech's came out a said "These things never go back the same" Not true I told them and then they had Rob come out and verify. He was all stressed out and said to them just do what the customer wants. They tried and could not fix it, Rob said when I come back for the rotor he would try again. I took it back and they did the rotor thing but could never fix the Tupperware issue. I took it all off and tried myself, I was able to fix the side parts but cannot get the top back the way it was. I think that while it was off they may have dropped it or it was apart sitting outside in the direct August sun getting warped (if possible).

Any way enough rambling. I hope Rob moves along and opens an independent service shop. IMO he needs to get away from all the service admin of multiple bike lines and employees and get back to working on the bikes not the books....

Dave Oehler
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post #12 of 18 Old Sep 25th, 2009, 11:08 am Thread Starter
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Re: DeSimone BMW

What a said state of affairs. It will be interesting to see if Rob stays after they drop BMW in November. Does not sound like he is happy or utilizing his talents where he is. He had the best little dealership I have ever used. I bet he could make a fortune just wrenching with his reputation or at least a good living.
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post #13 of 18 Old Sep 28th, 2009, 2:39 pm
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Re: DeSimone BMW

Very sorry to hear this about DeSimone, more especially Rob. He was always the drawcard for them. When I bought my LT in 2000, I tried to buy off him (when he had his own shop), but his salesman was in anti-sales mode, so I was forced elsewhere.

It seems pretty crazy to me that the 5th biggest city in the USA won't have a dealer within its boundaries.

If you are reading Rob, all the best, and don't forget the invite down to NZ.

Ralph
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but I left my biking heart along the Scenic Byways of America.....

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Today of past regrets and future fears." ....Omar Khayyam
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post #14 of 18 Old Sep 29th, 2009, 8:38 pm Thread Starter
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Re: DeSimone BMW

I know what you mean! Fritz or Fran or whatever his name was could be a real pill. I understand he is hawking yachts in Florida these days.
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post #15 of 18 Old Oct 6th, 2009, 6:30 pm
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Re: DeSimone BMW

I stopped in at DeSimone Motorsport today to get a new rear tire installed on my 06 KLT. What a sad sight to see all of the beautiful BMW's, Ducati's, Triumph's, and Victory's and then to realize this place won't be around after Thanksgiving and it just breaks my heart. It's said to be a sign of the times but it's times like these that really SUCK!! Talking with some of the employees, they are really down and out about it but also wondering what the future holds. Attached is a form letter I received from DeSimone justifying their decision to close.
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Rob Sprague
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post #16 of 18 Old Oct 15th, 2009, 3:58 pm Thread Starter
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Re: DeSimone BMW

What a crock! Desimone could care less about anything other than selling Caddies, Rolls Royce and the other four wheeled junk they specialize in. In collaboration with BMW, they put the small dealers we loved and depended on for years out of business. We gave up Touch of Class, RK BMW and many others and handed the reins over to glorified car dealers and wonder what went wrong.

By the way, I only refer to Desimone's letter as a crock, not the original post.
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post #17 of 18 Old Nov 20th, 2009, 11:36 am
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Re: DeSimone BMW

+1, i've always heard that this place was a converted car dealership and that they were in it only for the money but who can blame them right? Once sales declined on bikes, they bailed out.
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post #18 of 18 Old Nov 20th, 2009, 4:46 pm
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Re: DeSimone BMW

I find it interesting that DeSimone's solution for his revenue issues was to continually add more brands. I'm certainly not familiar with his financials, but he fits the profile of a typical dealer who get's poor share with one brand and figures the problem is with the brand, so let's add another. Now he has two brands with poor share, so let's add a third. Maybe that will fix our revenue issues. When, in fact, the real issue is with the leadership of the store (or lack of leadership) and an inability to maximize the revenue potential of the brands they have. I realize this is a huge generalization, but it was interesting to see in my 30 year automotive mfg career how many times it played out in exactly that fashion.

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1990 Honda Shadow (sold)
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