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A Fetching Deal


Last August, Gary Twing put down a deposit on a new $95,575 Mercedes-Benz SL550 at the dealership near his home in Nevada City, Calif. On Apr. 20 the 65-year-old investment adviser picked up his car—at the factory in Sindelfingen, Germany.

Twing took advantage of an overseas delivery program that lets Mercedes (DCX) customers turn the buying process into a European vacation. After taking delivery, Twing and his wife are touring Germany, France, and the Netherlands before flying to Poland to finish up the three-week trip. He paid for part of the trip with the 8% discount Mercedes gave him off the sticker price. It was at least the 12th time he has taken a Mercedes buying vacation since 1978, when he and his family collected a 300CD coupe and drove it through 11 countries. "We're on a first-name basis with the people at the delivery center," says Twing.

Mercedes is one of six European automakers to offer overseas delivery for U.S. buyers, along with BMW, Porsche, Saab (GM), Volvo (F), and now Audi, which started a program last fall. Your car is built to meet U.S. emissions standards, registered and insured to use in Europe while you're there, then shipped home free of charge (and customs duties). Getting it from the port to the U.S. dealer, where you take possession of it for good, may incur additional expense. Most companies also offer free or discounted airfare as well as some lodging and meals.

Over the past year, several of the carmakers have sweetened the deal by offering vacation packages, many at better prices than you can arrange on your own. BMW has three itineraries that bounce buyers among luxe resorts in Italy, Austria, or Switzerland, starting at $2,600 per person. Volvo features 15 travel options, including a six-day Swedish golf excursion ($1,295 per person), while Mercedes is offering a four-night rally through the Black Forest and the Alps for $1,300 per couple.

If you want something more exotic and you've been yearning for a Saab, you can join a group of other new owners for a five-day, wintertime Nordic sojourn complete with dogsledding, snowmobiling, driving on a frozen lake, and a helicopter ride to Sweden's highest point. Saab charges $3,500 per couple for the adventure but throws in a $2,000 travel stipend, which can be used for airfare, hotel, or just walking-around money. "Once we balanced out the discount we were getting, we felt like we were getting the trip for free," says Jody Thomas, a design director for America Online (TWX), who took the Saab Ice Experience in February with her husband, Michael Harbin.

If you're game for this type of experience, you should hit the dealership at least three months before you want to travel. Any dealer can arrange overseas pickup, but veterans say it helps if yours has experience with the program.

Not all models are available through these programs. For example, you can't pick up Mercedes SUVs or BMW's Z4 convertible in Europe because they're built in the U.S. While leasing and financing are possible, you might run into trouble if you don't arrange them through the car companies' financing subsidiaries.

Discounts offered vary by model and make. At the high end is Saab, which lops $3,160, or nearly 12%, off the $26,995 price of its 9-3 2.0T sedan. Audi gives only a 3%, or $760, break on the $25,340 price of its A3 2.0 T. Those discounts are just the minimum. You can try to drive a better bargain with your dealer.

The vacation was the deal clincher for Jason Rempel, an equities trader for Citigroup (C) in San Francisco. Last summer he looked at Toyotas (TM) and Volkswagens (VLKAY), but neither company offered overseas delivery. BMW did, however, and the $4,000 discount he could get on an X3 compact SUV, about 7% off of list, coupled with the carmaker's two-for-one airfare offer, would more than cover the cost of a European trip for him and his wife, Christina Babbits.

As with any car purchase, the options can add up. All of the carmakers will allow you to bypass the factory and pick up and return your car in another city, but they charge you several hundred dollars more to do so. They also charge you to insure the car for longer than two weeks and might require a deductible (it varies by brand) if you have to make a claim. Stay for longer than six months and you'll incur Europe's value-added tax of as much as 25% of the purchase price.

While the manufacturers want you to believe you'll be treated like royalty, the delivery centers get crowded on Fridays and Mondays and are typically closed on the long list of holidays in European countries. Also be prepared for gasoline sticker shock. Says Rempel, who logged 3,000 miles in eight days in his dark gray Bimmer before dropping it off in Amsterdam to ship it home: "At $7 a gallon, it adds up pretty quick."

Not so quick: Rempel was home six weeks before the car, which is typical. But the vacation made up for the wait.

By Andrew Park


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