When BMW first entered the premium SUV sector with its X range it used a novel offering to leverage improved margins. Now it hopes to do the same with its "born electric" i range at a time when, it believes, the global premium sector price war is easing everywhere except in Europe. BMW brand head of sales and marketing Ian Robertson spoke to Automotive News Europe Editor Luca Ciferri about the company's i strategy and provided some early insights into who has been placing orders.
Are the price dynamics of premium cars influenced by market trends or by automakers' product cycles?
There is always a competitive model in the marketplace and all manufacturers are on different cycles. At the same time, being first to market with new segments, as we did with our X models, helps to grow margins. In this regard, the i3 and i8 are off to a strong start. In the run-out phases at BMW we normally increase specifications. This way of motivating a customer to buy a car at the end of its product cycle is far better than any normal incentive could ever be.
How do the major markets differ?
In Europe, the picture is skewed because the economic situation in individual countries varies so much. But if you look at a more normalized environment – such as Asia or, in recent times, the U.S. – you will find incentives there for the luxury market are significantly lower.
What about China’s evolution?
China is clearly maturing. We have sold more than a million cars in the last four years. This means a replacement cycle is starting. It also means that as well as a huge new car market a significant market in used cars is starting to appear.