German Car Zone

+1

Need?

Enough people want it, and BMW will offer it.

BMW new policy is to enter all segments where there is a demand for a premium vehicle (regardless the price & size). Of course if the project is profitable enough, and the product meets BMW driving dynamics standards & other core values of the brand.

Apparently there is a need for a premium small cross-overs (you can see X1 is not a classic SAV!) ... Check out Audi's Cross Coupe Quattro! And MINI's upcoming crossover. And rumored MB's mini SUV.

Small cars are very popular in Europe - even the premium ones. And it seems US market is also warming up to the smaller premium cars (of the right shapes). And beside coupe & cabrio a small crossover is also desired by the customers.

Like said many times: nothing is done without severe researches & analyses. Why expansion? To get higher revenues ... eg. to cover higher R&D costs.


And Scott also explained:

No offense EnI, but this is starting to sound like a scratched CD. BMW is doing the very same thing that so many here said Mercedes made a mistake in doing, trying to put a MB in every garage. BMW is doing the same exact thing. I mean really how many acronyms can BMW come up with a straight face? BMW is pimping themselves IMO. There is no need for all these less-expensive BMWs and more Minis at the same time. BMW shouldn't be Toyota in the sense that they'll build whatever people "want". You have to draw the line somewhere with a so called "premium" brand. IMO of course.

M

Well said, i completely agree.

Oh ... here we go again.



The problem with MB wasn't the expansion per se but the bad products (eg. Mk1 A-class ) not fitting well the MB brand.

BMW are more consistent: they are offering new products that meet brand value standards - especially the class leading driving dynamics.

Sorry to say that but MB & BMW are forced to expand the product range ... not only down-market (1er family, A-class & B-class families etc) but also up-market (X6, F5, Z8, 8er, CLS, GLK, ODC based car? etc). Why? To survive! Both companies do not have big parents behind like Audi (Porsche / VAG), Lexus (Toyota), Infiniti (Acura), Cadillac (GM), Jaguar (Ford) which lower the costs (sharing R&D, production, purchasing, administrative costs etc). So, these brands can afford to be more limited & exclusive.

Although it's hard to talk about exclusivity when selling 1 million or more cars per year (eg. BMW, MB, soon Audi).

In this case premium does not mean exclusive!!! Other features make these brands premium: brand image, new tech, better materials inside the cabin, brand specific characteristics (eg. comfort, driving dynamics, sportiness etc).

Eg. what makes Armani jeans better than Gap jeans? The brand name.


...


I'm sure BMW would like to stay exclusive ... Offering high-end expensive products ... in high-end segments only. Like eg. Porsche. But the price for that would be much too high: BMW's independence.

Why do you think Porsche acquired VW? To save its own future ... Otherwise PAG would slowly die. Now they assured themselves big cash, synergies in purchasing, R&D, production etc. And allowing Porsche brand to stay releatively exclusive (although a Porsche SUV & sedan is much worse whoring than a small BMW - especially BMW success started with small cars ... think 1600, 1800, 2002!!!).

"Whoring" is inevitable during the brands life. Exclusivity is almost impossible today. Unless the brand is only one of the many in the portfolio of a big luxury brands Holding (eg. LVMH etc; or eg Ferrari - Fiat, Lambo - VW, Hummer - GM, Bentley - VW, Rolls-Royce - BMW). Or a coach / boutique built branded product ...

But ...

Imagine Rover plan working well ... In that case I doubt there will be smaller than-3er BMWs (Rover cars instead), BMW SUVs (Land Rover SUVs instead). But that already a history ...

I'm resisting the urge to say the same thing "oh here we go with that again" EnI.

The bottom line is that building more and more suvs doesn't help BMW one bit and building a small BMW suv and a Mini Suv is ridiculous, IMO.

All that corporate jazz is in need of a touch up. It is understandable, but seems to be a bit of a grand excuse for BMW to just produce anything. We might as well get rid of their other slogans like "ultimate driving machine". I'm sure there are some among the ranks of the BMW faithful that would like to have more than a bunch of new suvs and crossovers.

M

Interesting as Roundel magazine's November issue has reffered to X6 as CAV (Crossover). No idea where they got it from. Hope you don't work for Roundel.

No, I don't.


But I guess since there are CUVs already out there, and since BMW like to use the word "activity" instead of "utility" (eg. SAV instead SUV) ... many people (me incl.) name BMW crossovers as CAVs.

Like I said: BMW have no choice. Neither do MB. Yet I have no idea what's Audi's agenda (expansion just to catch up the rivals?).

What eg. 1er & SAVs do for BMW? Sales & revenues!
Yearly sales:

X5: 120k
X3: 110k
1er: 150k
X6: 40k
X1: 100k ???

= 520k units more per year!!!

Also making the company less depended on 3er sales. Before SAVs & 1er were introduced BMW were too dependent on 3er ... 3er sales totaling way over 50% of all BMW sales.

Too strong dependency on one product is never good. Too risky for business. Much too risky.


Expanding in conventional up-market segments (eg. large sedans, roadsters, coupes, cabrios) wouldn't change the situation much ... Therefore expansion down-market & in innovative (trendy) segments is needed. Many of such segments develop in a conventional segments (mind station wagons, hatchbacks, SUVs etc).




Perhaps you guys are just too conservative ... Too puristic.

Although ... The most hard core purist would say the only true BMW = small 2dr sedan. All the other models are pure whoring.


The world is changing. And everyone has to adapt to survive: individuals, families, countries, organizations, companies, and even brands ...

Makes sense on paper, but the alphabet soup is just overwhelming. I can't remember all of MB's designations and BMW's it is just to much.

M