BMW: the next big adventure
More new models on the way as German giant aims for 2m a year
Like a few other car hacks, I live in a small, personal black hole of semi-poverty in the otherwise leafy and grossly affluent lanes of Berkshire. Three miles away lies the UK headquarters of BMW. Anyone joining the endless lines of traffic on the term-time school runs could be forgiven for thinking they were in BMW’s car park. The roads swarm with them and smaller numbers of Mercedes-Benz and Audis. Here, anyone wanting motoring exclusivity buys a Ferrari or a Ford Mondeo.
But is BMW finally beginning to push its luck? At what point – no matter how good or innovative the product – does a car brand start to lose its aspirational quality, when it seems that almost everyone has either got one or can afford one, right down to the 15-year-old red 3-Series with furry dice tarmac-tearing around Brixton?
The question assumes real significance following a recent strategy board meeting in the lofty heights of BMW’s ‘four-cylinder’ HQ in Munich – one of the most important meetings, in terms of its conclusions, in years. At it, management board chairman Norbert Reithofer and his colleagues set a course taking BMW all the way through to 2020 – and, if all goes as planned, production and sales of over 2 million vehicles a year.
That is pretty well double its output of little more than a decade or so ago: a time when I was told earnestly by one of BMW’s former UK MDs that its British market share shouldn’t rise above 2 per cent without risking eroding exclusivity. Already, the figure is well over double that.
The number of new product plans is almost bewildering. Using modular production and engineering systems in order to achieve cost-saving synergies, additional models will include, just for a start, a new X1 SUV and what was shown as the X6 sports/GT SUV concept at the Frankfurt motor show. There will be a so-called Progressive Activity Sedan (PAS) which BMW claims will establish ‘an entirely new segment, introducing a unique interpretation of the sedan and offering a wide range of intelligent features’. Think of any market niche, in short, and Reithofer reckons there will be a BMW sitting at its pinnacle, creaming off fat profits. Its two other brands, Mini and Rolls-Royce, are part of the grand design: there will be a ‘sports activity vehicle’ Mini, whatever that means, and, of course, the additional, smaller Rolls-Royce, also destined to come in several varieties.
Just like Helmut Panke, a predecessor chairman whose initial vision it was, Reithofer is convinced that BMW can remain a hugely profitable, prestige, high-margin business even at more than 2m units a year by marketing its cars as the ‘premium’ competitors across every market segment, and selling more into growing markets like India and China.
Industry gurus like Cardiff Business School’s Professor Garel Rhys reckon he is probably, but not certainly, right; but that BMW might just be starting to stray into risky territory. With Mercedes-Benz resurgent after its quality problems, ambitious Audi’s hugely successful foray into the prestige car market and expansionist and increasingly capable new players like Kia also anxious for a slice of the executive cake, the next few years should be fun to watch.
