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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

BMW recalling 1 Series ActiveE over bad drivetrain housing

There are always growing pains when automakers introduce new technologies. BMW is learning this with the electric powetrain used on the 2011 BMW ActiveE. According to the National Highway Traffic Safety Administration, about half of the all-electric 1 Series coupes currently in the hands of the public are being recalled for a potential problem that could leave the cars stranded.
With 700 ActiveE models running around the US, 360 of these cars have insufficient sealing between the electric motor and transmission, which could lead to premature wear to the connection between the two, which in turn could result in a loss of propulsion. BMW started notifying affected owners by phone earlier this month.
While no automaker wants a recall on its hands, it's much better for BMW to learn such a lesson now on the low-production, lease-only ActiveE ahead of the car's successor, the BMW i3, which is expected to be a much higher-volume EV. Scroll down for the official recall notification.

BMW builds awesome M4 GTS safety car and racing wheelchair

BMW has developed two very different, but equally impressive wheeled vehicles recently. The first is the new M4 GTS Safety Car, specially prepared to serve Germany's popular and highly competitive DTM touring car series. It packs 500 horsepower and trick water-injection tech, just like the other 700 road-going examples of the GTS. Unlike the street version, it features key upgrades like special LED lighting, radio communication equipment, and special livery, as well as the no-cost optional Clubsport pack that includes six-point racing harnesses, roll cage, and fire extinguisher. The other new BMW doesn't have an engine, but is highly impressive nonetheless. It's a racing wheelchair created by BMW DesignWorks. Stemming from the automaker's partnership with the United States Olympic Committee, it features carbon-fiber construction and has been streamlined for aerodynamic efficiency. Members of the US Paralympics Track and Field team will help further develop the wheelchair before using it at the upcoming games in Rio de Janeiro. We wouldn't be surprised if longtime BMW driver Alex Zanardi helped in its development as well, even if he'll be competing for Italy at the Paralympic Games this year. Related Video: New high-performance special model BMW M4 GTS to be employed as a safety car at the DTM in 2016. Special models from the BMW M's mid-range series with even better performance and radically designed for high-level driving dynamics have enjoyed a lasting tradition at BMW M Division for decades now. The latest example is the BMW M4 GTS. BMW M has opted for a particularly spectacular way of drawing the public's attention: The BMW M4 GTS is to become the official DTM safety car during the 2016 season. Munich , 28th April 2016. Special models from the BMW M's mid-range series with even better performance and radically designed for high-level driving dynamics have enjoyed a lasting tradition at BMW M Division for decades now. The latest example is the BMW M4 GTS, which is limited to 700 units (combined fuel consumption: 8.5 l/100 km; combined CO2 emissions: 199 g/km)*. In order to provide formidable proof of this elite sports car's outstanding performance qualities, BMW M has opted for a particularly spectacular way of drawing the public's attention: The BMW M4 GTS is to become the official DTM safety car during the 2016 season. The demands on such a lead car at the most popular international touring car series are high.