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Summary

BMW, once the top-selling luxury brand, has seen Mercedes-Benz surpass it in sales. Despite a slight overall group sales lead in 2018, BMW faces criticism for becoming stagnant. The brand, known for innovation and performance, is urged to reinvigorate its image and address the electric vehicle market more aggressively. With a strong presence in China and upcoming models, BMW aims to reclaim its title as the world's best-selling premium brand.

Takeaways

• 🏆 BMW lost its position as the top-selling luxury brand globally to Mercedes-Benz in 2016 and has not regained it since.
• 📉 Despite total sales of the BMW Group being slightly higher than Mercedes-Benz cars in 2018, BMW's sales growth has slowed, causing concern among investors.
• 🔄 BMW is perceived as having become somewhat stale and in need of innovation, both in design and strategy, to avoid an identity crisis.
• 🆕 In August 2019, BMW appointed a new CEO with a mission to reinvigorate the brand and address the concerns of investors.
• 🛫 Founded in 1916 as an airplane engine manufacturer, BMW's history includes significant innovations and transitions, including a post-WWII shift to household appliances and later to automobiles.
• 🏁 BMW Motorsport, established in 1972, has been instrumental in shaping BMW's performance-oriented cars, contributing to its reputation for luxury and performance.
• 🚗 The introduction of the BMW 3-series in 1975 marked a turning point, establishing the small sporty car as a segment leader in the sports sedan market.
• 🚙 The shift in buyer tastes towards sport utility vehicles (SUVs) in the late 1990s led BMW to introduce the X5 in 1999, which has been a sales success despite initial backlash.
• 🔋 BMW's early lead in electric vehicles with the i3 and i8 has not translated into significant sales success, with concerns about design and battery range.
• 🔌 The company's strategy has shifted towards plug-in hybrids, which may be less costly in the short term but raise questions about long-term competitiveness in a fully electric market.
• 💡 While facing challenges, BMW has strong brand recognition and is seeing solid growth in China, its largest market, which accounted for 30% of its global sales in 2018.

Q & A

What is the primary reason for BMW losing its crown as the top-selling luxury brand?

In 2016, BMW lost its crown as the top-selling luxury brand to Mercedes-Benz, which has maintained its lead due to better sales growth and more model variants.

How did BMW's total sales compare to Mercedes-Benz in 2018?

In 2018, the BMW Group slightly outsold Mercedes-Benz cars, with BMW selling 2,490,664 units compared to Mercedes-Benz's 2,438,987 units.

What factors have contributed to BMW's perceived stagnation in recent years?

Sales growth at BMW has slowed, and there are concerns that the brand has become consensus-driven, less innovative, and more repetitive in design, leading to the replacement of its CEO in 2019.

What historical events shaped BMW's early years and product focus?

BMW was founded in 1916 as an airplane engine manufacturer. After World War I, a state prohibition led it to make railway brakes and inboard engines. It produced its first motorcycle in 1923 and its first cars in 1929.

How did BMW's involvement in World War II affect its operations and reputation?

During World War II, BMW made weapons and relied on forced labor from convicts, prisoners of war, and concentration camp prisoners. After the war, the company faced destruction of its manufacturing facilities and transitioned to making household appliances.

What was the significance of the BMW 1500 sedan introduced in 1961?

The BMW 1500 sedan, introduced in 1961, marked a turning point for the brand, leading to the development of the 1600, 1800, and 2000 models, and eventually the iconic 2002, which established BMW as a leading manufacturer of sports sedans.

How has the SUV trend impacted BMW's product lineup and sales?

Despite initial backlash from purists, BMW's SUVs, referred to as sport activity vehicles, have significantly boosted sales, accounting for 37.3% of total BMW sales in 2018.

What challenges has BMW faced in the electric vehicle market?

BMW's fully electric i3 and hybrid i8 have not been major sales successes. Critics argue that BMW's strategy of focusing on plug-in hybrids may not keep pace with the industry's shift towards fully electric vehicles.

How has BMW's competition with other luxury brands influenced its market performance?

BMW's competitors, particularly Mercedes-Benz and Audi, have outperformed it in sales growth and market share, partly due to offering more model variants and a stronger focus on electric vehicle technology.

What role does the Chinese market play in BMW's overall sales strategy?

China is BMW's largest market, accounting for 30% of global sales in 2018. BMW's sales in China grew nearly 8% that year, and the company is increasing its stake in its Chinese joint venture to boost profits further.