The German luxury car maker confirmed on Monday that it was being investigated by the United States Securities and Exchange Commission. The company however did not provide nay details about the cause or the focus of the investigation.
According to reports quoting sources who had knowledge of the purpose of the investigation, the manner in which BMW reported its sales figures in the United States is the issue that is being probed by the SEC. this news was first reported by the Wall Street Journal following which the car maker confirmed the issue to the media.
According to the initial report in the Journal, it is likely that the German car maker could have showed inflated apparent sales figures by prompting dealers to get such cars registered with the relevant authorities that had not yet been actually sold to customers.
The fact that company had been contacted by the SEC and that the company was also fully cooperating with the investigation was confirmed by a BMW spokesman to the media.
In a charge related to some faulty sales-reporting practices, a settlement fine of $40 million was agreed to be paid in the US by Fiat Chrysler Automobiles earlier this year. While no wrongdoing in that case was actually admitted by the FCA, the charges brought in by the SEC had claimed that the car maker had prompted kits dealers to report “fake sales” by bribing them. The SEC also alleged that a database of unreported sales had also been maintained by FCA which was used by the company to later file report to maintain a facade of year-over-year monthly sales increases for over six years.
The two top selling luxury brands in the United States are both German companies – BMW and Mercedes-Benz. And according to data from Kelley Blue Book, BMW is outselling Mercedes luxury cars and SUVs in 2019 excluding Mercedes’ large Sprinter and Metris vans. According to KBB, the competition between the two brands is very tough. As of November 2019, 289,080 vehicles were reportedly sold by BMW while 285,800 vehicles has been sold so far by Mercedes-Benz excluding the vans.
(Adapted from CNN.com)