American BMW Dealers Prioritize Product, Ask for Wagons
BMW had a decent 2019, besting historic rival Mercedes-Benz with 324,826 U.S. deliveries — a 4.4-percent improvement over the previous year. The brand expects more good news in 2020 as new product begins to hit its stride and more models start arriving. While the company currently enjoys an almost even sales breakdown between cars and crossovers, BMW National Dealer Forum Chairman Patrick Womack said its Westernmost offerings could be further refined.
U.S. dealers want a sumptuous German wagon to compete with European marques already providing one.
The Bavaria-based manufacturer believes product will be the most important factor in ensuring healthy growth over the next few years. Womack said the X7 (which arrived early in 2019) was an essential part of that, but he also noted there are still gaps in the brand’s lineup that need closing.
“The X7 was something missing in the lineup for 10 years plus,” he said in a recent interview with Automotive News. “Anybody who was looking for a larger truck with three rows … we would lose them to Mercedes.”
“There is a place for a luxury wagon with great BMW performance in the U.S. market,” Womack continued. “The Europeans get to enjoy that great product, and we need to compete with Audi and other brands that are in our marketplace.”
Despite wagons becoming harder to come by in recent years, North America has slowly begun rekindling its romance with the segment. Mainstream appeal hasn’t manifested, but high-end manufacturers like Mercedes-Benz have kept them available via the E-Class. Audi kept wagons alive with its Allroad variants, a group that now includes the high-performance RS 6 Avant, and Porsche has the Panamera Sport Turismo.
BMW does have liftbacks, though none of the models sold in the U.S. could be considered traditional wagons. Womack said the company shouldn’t discount Mercedes’ lackluster financial performance as any indication that it will automatically stay on top without continued effort. Proper product allocation, including delivering the electric i4 (aimed at Tesla’s Model 3), will serve as BMW’s main assault.
We don’t expect BMW to start offering all-terrain wagons when its SUV lineup seems strong, but the road-focused 5 Series Touring might make a strong addition — especially if it’s worried about Audi and Mercedes-Benz. Still, profit margins are shrinking across the industry and exporting wagons isn’t something BMW will entertain if the beancounters in Munich don’t think there’s enough customers waiting to make a down payment.
It also has to contend with other markets. As important as the United States is to BMW, Europe and China aren’t regions it can simply ignore. There’s a lot of energy being put behind the launch of three EVs in 2021. Hooking America up with a wagon may not be as salient as making sure greener products are launched effectively around the world, even if they won’t sell as strongly in the Land of Opportunity. Sticking with crossovers is the safer play, but dealers want a wagon if they can get one.
Womack had a couple other takeaways, most notably a lack of confidence in subscription plans. While he said such programs might have appeal in densely populated cities, he noted most Americans like the concept of ownership and prefer to think of an automobile as theirs. He also wants to see BMW broaden its rewards program to keep customers coming back, something the automaker already intends on doing.
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