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BMW Probed for Blocking Sales to Swiss Customers

Oct. 26 (Bloomberg) -- Bayerische Motoren Werke AG, the world’s largest luxury-car maker, is being investigated by Swiss antitrust authorities for allegedly preventing vehicle sales in some European countries to Swiss residents.

The Swiss Competition Commission said today it has information BMW distribution branches in the European Economic Area, which includes the European Union’s 27 member countries as well as Iceland, Liechtenstein and Norway, are barring sales of BMW and Mini brand vehicles to Swiss citizens.

The Swiss franc has gained more than 9 percent against the euro this year, making BMW vehicles relatively more expensive in Switzerland, which isn’t part of the European Union. Munich, Germany-based BMW could face a maximum fine of 10 percent of group revenue in Switzerland over the past three years, Patrik Ducrey, a Swiss commission spokesman, said by telephone.

“Such a fine would be fairly sizeable for BMW’s regional branch though Switzerland isn’t a key market,” said Daniel Schwarz, a Frankfurt-based analyst at Commerzbank AG who recommends holding the stock.

BMW and Mini brand sales in Switzerland last year totaled 19,300 vehicles, spokesman Markus Sagemann said.

In Switzerland, BMW is selling the 5-Series sedan from 62,200 Swiss francs ($64,018), including the 7.6 percent value-added tax, and the top-of-the-line 7-Series from 105,300 Swiss francs, according to the carmaker’s Web site. The starting price of the 5-Series in Germany with sales tax is 41,900 euros ($58,459) and the 7-Series is 73,300 euros.

“We have asked BMW for comment after we opened our inquiries yesterday,” Ducrey said, adding that the investigation may take as long as two years. A BMW spokesman confirmed the investigation and declined to comment further.

BMW fell 28 cents, or 0.6 percent, to 50.44 euros at the 5:30 p.m. close of trading in Frankfurt. The stock has gained 59 percent this year, valuing the carmaker at 32.3 billion euros.

To contact the reporter on this story: Andreas Cremer in Berlin at acremer@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

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