Recently, several BMW 4S stores in China have refused to deliver vehicles according to contract, causing dissatisfaction among customers. The 4S stores have imposed additional tens of thousands of yuan (RMB) as a condition for customers who wish to take delivery. This news made it to the top trending searches on Baidu on July 22.
According to a report from Jinan Daily Newspaper Group’s official account “New Yellow River Client” on July 21, a consumer in Chongqing stated that he signed a car purchase contract with Chongqing Baoyu Automobile Sales Service (Group) Co., Ltd. on May 29 for a BMW i3 priced at 174,500 yuan, and paid a deposit. At that time, the salesperson assured him that there would be no issues with the delivery, but as the delivery date approached, he was informed that an additional 30,000 yuan was required. Moreover, during the process of communication and negotiation over several days, the 4S store provided different reasons for not delivering the car each time. Ultimately, the store manager claimed there were no more cars available as they had ceased production.
A consumer in Zhengzhou also revealed, “I ordered a car at the end of June from Zhengzhou Baolianxiang Automobile Sales Service Co., Ltd., the model being a BMW i3. The contract was signed, deposit paid, and the loan plan approved. The client manager at the time said the car could be delivered in four to five days. However, just before delivery, I was informed that the price of the car would be increased by 20,000 yuan, and the financial plan was changed to a three-year interest-free scheme, or else delivery would be denied.”
Consumers in multiple cities including Chongqing, Zhengzhou, Shenzhen, Suzhou, and Dongguan have encountered similar situations. Most consumers had ordered their cars between the end of May and June, and when it came time for delivery in July, they were mostly asked for a last-minute increase of 30,000 yuan. Even for those who mentioned the cars, the process of taking delivery was very difficult.
Consumers believe that the reason for the refusal to deliver by BMW 4S stores is due to the increase in car prices, with the stores unwilling to sell at the lower price agreed upon during booking, hence the sudden price increase.
BMW China responded to the recent incidents of 4S stores refusing to deliver vehicles in various regions by stating that they had taken note of the relevant content and conducted a preliminary internal investigation. The investigation results indicated that the cases involved were isolated, and each case had its own unique circumstances. BMW China is currently communicating with the relevant dealers to ensure compliance with the “Regulations on the Management of Automobile Sales” and related laws, regulations, and contract terms.
Regarding this behavior by the 4S stores, Lawyer Chen Jinbo from Beijing Yingke (Guangzhou) Law Firm pointed out that consumers have signed contracts and paid deposits, thereby establishing and enforcing the sales contract. The refusal to deliver the cars by the 4S stores and the practice of demanding last-minute price increases constitute a violation of the contract terms, as well as the relevant provisions of the “Consumer Rights Protection Law,” “Price Law,” and the “Civil Code.” In cases where one party fails to fulfill the contract obligations or fails to meet the agreed terms, the defaulting party should bear the responsibility to continue performance, take remedial measures, or compensate for losses.
Lawyer Chen Jinbo reminded consumers that in the face of unreasonable practices such as price increases before delivery, consumers have the right to refuse. They can lodge complaints with the brand’s customer service hotline, and if the complaint is not addressed, they can file a lawsuit demanding that the 4S stores fulfill the delivery obligation as per the contract, and hold them accountable for any contractual breach due to delayed delivery. Alternatively, consumers can sue to terminate the contract based on the unilateral breach by the 4S stores and seek double the compensation of the deposit, or sue to hold the 4S stores accountable for the contractual violations. Even for consumers who have succumbed to the pressure and paid the increased price for delivery, they can still file a lawsuit to reclaim the excess amount paid.
In order to gain market share, Chinese car companies have been engaged in price wars for some time now and this trend continues. The prolonged price war over several months has not brought the expected market benefits to foreign car companies in China, but instead has caused significant losses to the brand value of automobile brands. Many international brands such as BMW, Mercedes-Benz, Audi, Volkswagen, Toyota, Honda, and others have withdrawn from the price war.
According to a report from mainland media “First Financial” and securities firm China on July 17, several BMW dealers in the eastern region stated that starting from the third quarter, BMW China and BMW Brilliance have canceled sales volume target assessments for dealers in the east. As a result, BMW dealers have reduced promotional efforts on terminal prices, leading to an average increase in the selling price per vehicle by approximately 13,000 yuan.
Sales personnel from a BMW 4S store mentioned that prices of all BMW products have been adjusted upwards, with prices increasing by varying amounts between 30,000 to 50,000 yuan.
Many netizens have expressed that 4S stores should adhere to the contracts and not unilaterally terminate them.
A netizen named “Sunflower Bloom” commented, “If the car is not delivered, a refund of the deposit along with triple compensation should be provided.”