Yesterday, Consumer Reports (CR) rated Cadillac’s new CTS a better whip than both a BMW 328i and Mercedes C300. Never mind that CR preferred the Infiniti G35 and Acura TL. A Bimmer had been bested by a Caddy! This is news! Bimmers are the buff book benchmark! Yes, well, tying the commercial success of BMW’s 3s and 5s to their on-road abilities is a perfect example of false synchronicity. While many models are justly coveted for their dynamic delights, their on-road performance is tangential to their sales appeal. BMW’s mojo lies elsewhere, in a more precarious place.
It’s worth repeating: in most head-to-head competitions, BMWs no longer deliver a knock-out blow. Their straight-line speed is impressive, but there are faster. Their interiors are nice, but Audi’s are better. Their seats are wonderful, but the passenger accommodations offer precious little lebensraum for the buck. Speaking of which, BMWs are significantly more expensive and/or under-equipped vis a vis their price-equivalent competition.
This leaves one strong link to BMW’s “Ultimate Driving Machine” brand boast: handling. Again, there are better handling cars– especially considering BMW’s recent penchant for passion-killing run-flat tires and active steering. More generally, does anyone seriously suggest BMWs are the best handling cars throughout their [enormous] model range? Plenty of Mazda, Infiniti, Mercedes and (now) Cadillac fans are willing to throw down to the Roundel’s rep for corner-carving kudos.
The truth about BMW is this: while the brand gets mad props from motor-journalists, the German automaker banks its bucks thanks to a very different demographic with a very different concept of “performance.”
While BMW still aims for the luxury car market stratosphere (the 7-Series and Rolls, neither of which amount to much) and slums it in the lower reaches (the premium-priced MINI line), the propeller badge might as well be a rifle sight. And yuppies are in the crosshairs.
No car is more identified with a particular rung of the corporate ladder than BMW. Nothing says “mover and shaker” more than an alphabet soup 3 or 5 in a reserved parking place. We’re not talking about the top slot; the truly highly-placed drive something with more presence. BMW is the ne plus ultra for upper middle execs, corporate clones whose cars must stand out from the “ordinary” (cynics might say “practical”) machines driven by the company’s lesser lights.
Overpaying is part of the cachet, “I’m going places, and I don’t need to worry about what it cost.” Sure, Bimmer’s rep for speed and handling is a nice seasoning. But truth be told, the sort of person who regularly buys/leases a BMW probably doesn’t have the time to go joyriding. The exact position of this “Bimmer spot” within the corporate hierarchy varies from country to country, but the template remains the same: Urban Professional on the Move.
On the Move. Ultimate Driving Machine. Done. It doesn’t really matter if a BMW lives up to its strapline– just as long as this business suit-wearing herd member buys the brief. The ultimate driving in question is symbolic; the BMW brand represents the single-minded “drive” known as personal ambition. Not to coin a phrase, if you own a BMW, you’re moving forward.Onwards. Upwards.
BMW’s recent, phenomenal success is tied almost exclusively to the explosive success of this well-fed corporate demographic. Some argue that the brand’s move down market has hurt their brand cachet. The opposite may be true. Ironic as it sounds, appealing to the upper middle class pack mentality may have propelled the propeller people’s products to even greater heights, saleswise.
And now, the reckoning?
If there is a significant worldwide economic downturn, existing and potential BMW buyers may not make enough bonus– or simply feel “safe” enough– to take on a new car after three to five years. Should the corporate axeman’s blade swing through the lower executive level with particular violence, BMW sales will suffer widespread decapitation.
That’s the problem with near luxury products. They’re not expensive enough to rise aove the fray, and they’re not cheap enough to fly under the corporate accountant’s radar.
Meanwhile, exchange rates are making things even more precarious. To compensate for currency fluctuations, BMW must either raise model prices and enter into entirely different segments or hold the line and take the hit on profits. Whether here [U.S.] or abroad, the falling dollar threatens to move its models up one or more “classes.” Instead of merely being notably more expensive than their Japanese and American competitors– for which “badge cachet” compensates– BMWs are becoming especially expensive.
If you thought the end of the SUV boom was bad for Detroit, The Big 2.8s exposure looks modest compared with BMW’s potential exposure to a general economic downturn. As Porsche proved back at the tail end of the 80s, if the worst happens, all BMW can do is… wait.













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