Saturday, October 31, 2020

BMW faces U.S SEC investigation over sales reporting practices

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BMW is being scrutinised by the United States Securities and Exchange Commission (SEC) over its sales reporting practices, months after the regulator extracted a penalty from Fiat Chrysler Automobiles over similar issues.

The German automaker has been contacted by the SEC and will cooperate fully with its investigation, said BMW spokesman Phil Dilanni.

SEC does not comment on the existence of any probes, said its spokesman Kevin Callahan.

BMW has been in a tight race with Daimler’s Mercedes-Benz for leadership of the US luxury auto market. While Mercedes has owned bragging rights for the last three years, BMW leads by fewer than 3,300 units this year, as of last month.

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In the past, dealers have criticised BMW for pressuring them to buy vehicles from the manufacturer to stock their fleet of vehicles loaned out to customers who are having their cars serviced. Bonuses or allowances that BMW paid to dealers in late 2015 and mid-2012 helped to inflate sales results, reported Bloomberg News.

Dealers are required to mark the cars as sold. To resell them to consumers as used models, they typically have to do so at depressed prices. In the meantime, the retailers also have to foot the costs of carrying the cars in their inventory.

BMW’s American depositary receipts fell 1.3 per cent to US$26.96 in New York trading.

Source: straitstimes.com

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