By on October 6, 2017

2018 BMW X3 M40i - Image: BMWMunich HQ has huge expectations for the third-generation BMW X3. The X3, after all, was the vehicle that ignited the compact luxury SUV craze, the vehicle that spawned competitors such as the Audi Q5, Acura RDX, Mercedes-Benz GLK/GLC, Volvo XC60, Lexus NX, and Porsche Macan. Surely the X3 has the power, the might, the capacity for sales domination, right?

“We created that segment,” BMW CEO Harald Krueger said in July. “The No. 1 approach and target I clearly have is, there shouldn’t be anyone besides us who is No. 1.”

“If somebody on my team is not performing to that, well, he has a problem,” Krueger says, making clear to BMW USA’s Bernhard Kuhnt that greater global production of the X3 will mean greater allocation, which had better mean greater U.S. sales.

BMW will not, however, seek to achieve the lofty sales goals by introducing the 2018 X3 with a price that undercuts its key rivals.

2018 BMW X3 X Line interior - Image: BMWAccording to CarsDirect, the 2018 BMW X3 xDrive30i utilizes a 2.0-liter turbocharged four-cylinder producing 248 horsepower. Price? $43,445.

That’s… fair. But while you might expect BMW to marry its sales expectations with the kind of price point that grabs the attention of Mercedes-Benz GLC, Audi Q5, and Jaguar F-Pace competitors, the base X3 is $400 more than the GLC300 4Matic, $970 more than the Q5, and $385 more than the base F-Pace.

The 2018 X3 is also $400 more than the outgoing X3, though the new model is more handsomely equipped: standard tri-zone climate control, forward collision warning, and a 10-inch touchscreen.

Increase the price by $11,850 and the 2018 X3 becomes an M40i, powered by a 3.0-liter turbocharged inline-six with 355 horsepower. At this $55,295 price point, the performance-oriented X3 manages to undercut vehicles like the $57,245 Mercedes-AMG GLC43, $60,770 Jaguar F-Pace S, and $56,450 Porsche Macan S and sits $20 higher than the Audi SQ5.

Through the first nine months of 2017, BMW X3 sales are up 4 percent to 32,127 units, which places the X3 on track for a second consecutive year of record U.S. sales. But that’s fewer sales than the Lexus NX, Acura RDX, Audi Q5, and Mercedes-Benz GLC have managed.

Ranking fifth? BMW’s Harald Krueger says that’s a problem.

[Images: BMW]

Timothy Cain is a contributing analyst at The Truth About Cars and Autofocus.ca and the founder and former editor of GoodCarBadCar.net. Follow on Twitter @timcaincars and Instagram.

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18 Comments on “2018 BMW X3 Is Supposed to Become the Segment Sales Leader, but It’s Priced Higher Than Key Competitors...”


  • avatar
    hreardon

    I haven’t driven the new X3, but the last two generations did absolutely nothing for me. Frankly, neither does the Q5, but I would have taken the Q5 over the X3 any day of the week.

  • avatar
    SCE to AUX

    “…the base X3 is $400 more than the GLC300 4Matic, $970 more than the Q5, and $385 more than the base F-Pace.”

    At $43445, we’re talking about a 1-3% difference – hardly meaningful, and easily lost in a negotiated price.

    The M40i’s price is under its competitors by the same amount.

    So I’d argue that price has nothing to do with the X3’s market share.

  • avatar
    tylanner

    The X1 is probably the biggest threat to the X3 market share. Let us not forget the inevitable introduction of an X2 and an X4 each with dimensions that differ by one-inch.

    BWM is getting really good at scaling their trademark design cues (Ok, maybe not the 1-series).

    • 0 avatar
      stingray65

      The X1 is almost as spacious, looks good, drives well, and is a fair bit cheaper, so the X3 has much tougher internal competition than Mercedes has with the awful GLA or Audi has with the Q3. Nevertheless, record sales in the final year of generation 2 against fresher competition isn’t too bad, so the new version should make some inroads.

  • avatar
    BC

    BMW’s model is to promote leasing over sales. If you look at the lease prices on these cars, they are competitive with acura and lexus – if not more affordable. A high MSRP with a “killer” lease rate just makes the car seem like a better deal.

    • 0 avatar
      MrGrieves

      Exactly. As I see it – everything in BMW’s vehicle and engineering strategy is tailored towards leasing. Pricing, maintenance schedules, options packages… they’re all for people who lease, keep the vehicle 3 years, and then return it for a new vehicle. The old vehicle ends up as CPO or at auction.

      Beyond the lease, BMW’s CPO program isn’t as generous as it used to be. Now it’s just one additional year / unlimited miles above the original warranty, with a long list of items that are not covered. Such as… window regulator mechanisms (the motor is covered but the mechanical assembly isn’t), suspension bushings, coolant hoses, any body seals or weatherstripping/gaskets, etc. As the salesman said: “nothing rubber, plastic, or glass is covered.”

      I’ve owned 3 BMWs but just can’t see myself ever owning another. Their target customer demographic has changed, but I haven’t. Oh well!

  • avatar

    I think the new Alfa Romeo Stelvio is much more compelling than this.

  • avatar
    jkross22

    Meh. Had the current X3 for a few days as a loaner. Snoozefest. It’s a 4 door minivan with none of the minivan features. It’s also not a minivan which is probably why it’s selling.

  • avatar
    Fred

    I would of thought the Lexus NX would be number 1, but then that front end is a bit much.

    • 0 avatar
      fvfvsix

      The NX has a few strikes against it:
      1) The only engine option is 2.0t, and that motor doesn’t really feel very powerful in the NX. So, with no 300+HP “aspirational” trim, they probably lose buyers to the RX.

      2) The RX has the smallest effective cargo area of the bunch mentioned. It’s unbelievably shallow, and the sloping hatch cuts into volume even more. It may not seem like that big of a difference, but the X3 & Q5 have 4Runner-sized cargo holds, which actually make them really useful for very light hauling duties

      3) The NX’s most attractive front fascia (F-sport) is only available with a black vinyl interior, and a reduced feature set from the more luxury oriented models.

      4) I know this isn’t very common, but I added a $1500 trailer hitch to my X3. This, and a 3500lb towing capacity are adequate for small trailers, yard cleanup, etc. The NX/Rav4 platform can tow (I believe) 1500lb. Even a small U-haul trailer becomes an annoyance at that capacity.

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