Switzerland fines BMW $163 million: Highest ever in Swiss history
German luxury car manufacturer, BMW has received a fine of $163 million (156 million Swiss Francs) from Swiss Competition Commission. This fine is also the largest fine which has been levied by the Swiss Competition Commission in its history against a car manufacturer. The reason this huge fine has been levied on BMW is because they stopped Swiss people from buying BMW cars outside Switzerland in 2010.
Value of Swiss Franc has risen by a good 20% over the last two years, thanks to tumbling global economy and EURO. Because of this difference, Swiss residents are buying cars from neighboring countries like Austria and Germany.
According to BMW’s official website, in 2010, price of BMW 5 Series sedan in Switzerland was 62,200 Swiss Francs ($65,100). Apart from this, BMW also levied a 7.6% VAT which shot the value of the car to over $70,000. The same 5 Series sedan was priced in Germany at €41,915 ($52,700) without any extra taxes.
In 2011, BMW sold a total of 319,000 cars in Switzerland while the number in Germany stood at a staggering 3.2 million. BMW is also the largest luxury car manufacturer in the world today with a value of €39.6 billion ($49.77 billion). BMW share prices have increased by 20% this year.
According to Mr Daniel Schwarz, Frankfurt-based analyst with Commerzbank, “The fine is surprisingly high, considering how small the Swiss market is. It reflects Switzerland’s problem of trying to protect its domestic market from the appreciation of its currency.”
In their reply, BMW spokeswoman in Switzerland said, “We categorically reject the accusations, the argumentation and the amount of the fine. BMW adhered to all laws governing both Switzerland and the European Economic Area. We have one month to consider a possible appeal, but the decision has already been made that we will take this to the next higher level of jurisdiction.”