German Car Maker BMW Motors Ahead

Strong car sales, both national and international, have driven BMW profits to an annual high, despite an overall slump in the global automobile market.

Sales rose by 3 per cent in August compared to the same period last year, with more than 60,000 cars delivered to customers worldwide. BMW brands have sold more than 600,000 models so far in 2002.

“This result confirms our expectations of being able to deliver over a million BMW and Mini brand vehicles to customers this year for the first time,” BMW’s marketing and sales director, Michael Ganal told the BBC.

Particularly the MINI brand has proved a real hit after its market launch in the United Kingdom in July 2001, 40 years after tiny car first appeared on the car market. More than 100,000 MINI Coopers and MINI Cooper S models have been sold all over the world, 76,500 alone in the first half of this year.

Sales rise in Germany

With the help of MINI, but also other BMW brands, such as the new 7 series, sales have surged in Europe – reaching an all-time sales increase in the UK of 71 per cent to 7,800 cars (2001: 4,500), followed by Italy – up by 46 per cent to 6,100 automobiles, and Spain – up 23 per cent to 4,700 cars.

On the the difficult German market, sales increased by 11 per cent to 23,900 units.

In addition, sales rose by 15 per cent in the US, and in Canada by 50 per cent.

New image?

Analysts say the car maker’s current sales success – at a time of weakness both globally and in BMW’s key markets in the US and Germany – are the result of the careful reshaping of the company’s image.

“BMW has moved on from the negative “yuppie” envy provoking connotations that haunted the brand in the late 1980s (….) to become a widely recognized mark of achievement,” Merrill Lynch automative analyst Stephan Reitmann told the BBC earlier this year.

New cars for new target groups

But BMW also sees its current success in the widening of its range of models, and the introduction of new brands for new target groups.

“What is going on on the automobile market is an increasing polarisation,” Ganal told Spiegel Online this week. “On the one hand the number of premium brands for exclusive cars is growing. On the other hand, however, there are too many markets, who are still grappling with simple transport problems” – meaning the increasing demand for small, simple, but still high-quality cars.

After this year’s success with MINI, BMW is now planning on introducing a new 1 series in 2004, a car, according to Ganal for “people, who don’t necessarily want a large car, but one with substance”.

In addition, BMW will continue to focus on exclusive brands, including Rolls Royce which BMW will take over in 2003. To fill the gap between Rolls Royce and the 1 series, BMW will also be introducing the 6 series in 2004, a large sport coupe´ which, Ganal said in Spiegel, “will help streamline BMW’s character and profile."