About 30% of BMW Buyers Opt for Value Loans

Residual value loans, which were once pioneered by imported car brands, are now being actively promoted by Japanese automakers as well. This system, which has gained widespread acceptance with campaigns like "TOYOTA: Pay for 3 Years," has seen BMW, a major player in its early adoption, steadily expand its customer base with its residual value-based "Value Loan."

So, just how many people are actually using the Value Loan? We spoke with Kenichi Goda, General Manager of Marketing Services at BMW Japan Finance, which handles BMW's various financial services.

"From January to December 2008, the loan utilization rate (including leases) was 55.1%. Of this, residual value products like the Value Loan accounted for approximately 70% (including a few percent from leases). Therefore, about 35% of our BMW customers are using the Value Loan. This is a remarkably high figure compared to others."

According to Mr. Goda, the Value Loan is particularly popular among buyers of the 3 Series. It undeniably lowers the financial barrier for those who might have found imported cars intimidating, making it an indispensable tool for sales.

While rivals have naturally followed suit, Mr. Goda notes, "Thanks to the aggressive advertising campaigns by Japanese car manufacturers starting around last year, the increased awareness of residual value loans is a tailwind for us. On the other hand, our strength lies in our sales staff, who have been handling the Value Loan for many years and are 'accustomed to explaining' its details to customers."

BMW began offering the Value Loan 14 years ago, in November 1994, ahead of its time. A sense of pride as a pioneer can be felt in Mr. Goda's words.