No. 911
August 23, 2017
 

About The Autoextremist

Peter M. DeLorenzo has been immersed in all things automotive since childhood. Privileged to be an up-close-and-personal witness to the glory days of the U.S. auto industry, DeLorenzo combines that historical legacy with his own 22-year career in automotive marketing and advertising to bring unmatched industry perspectives to the Internet with Autoextremist.com, which was founded on June 1, 1999. DeLorenzo is known for his incendiary commentaries and laser-accurate analysis of the automobile business, as well as racing and the business of motorsports. Author. Commentator. Influencer. The Consigliere. Minister of the High-Octane Truth. DeLorenzo is considered to be one of the most influential voices commenting on the business today.

DeLorenzo's latest book is Witch Hunt (Octane Press  witchhuntbook.com). It is available on Amazon in both hardcover and Kindle formats, as well as on iBookstore. DeLorenzo is also the author of The United States of Toyota.

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Monday
Jun262017

BMW’S LONG SLOW SLIDE INTO MEDIOCRITY.

By Peter M. DeLorenzo

Detroit. A few weeks ago, in our annual AE Brand Image Meter column, I had this to say about BMW: The ubiquitous German brand, which once upon a time in a galaxy far, far away created its destiny with the funky little 2002, has shockingly become the Chevy of German luxury brands, the result of leadership teams over the years pushing the brand into every segment – both real and imagined – that seemed to make sense. This quest to be in every garage in every toney community in America has delivered vast profits for the propeller brigade, but it has gutted its brand integrity. Yes, they still crank out “M” versions to remind everyone of what they used to be, but they’re not fooling anyone anymore. BMW’s brand image is lost in a choking haze of profitability over integrity, and it’s not likely to find its way back anytime soon.

This week, Automotive News is filled with notable hand-wringing about BMW from its dealers, corporate operatives and analysts, due to the fact that the company has a new U.S. CEO in place (since March 1). Bernhard Kuhnt, 49, (pronounced KOONT) has been given the unenviable task of running BMW of North America, but no one really has a clue as to what that means and how things are going to get better. Yes, there’s a new X3 arriving shortly, but the ho-hum feel of the new BMW model speaks volumes about the brand’s current state of ennui.

BMW’s dealers are pissed off because BMW is still building too many models and the push from the factory to deliver even more sales volume is simply out of hand. But, at the same time, of course, these dealers are also clamoring for a better truck-to-car inventory mix so that they can sell more vehicles. (Dealers wanting it both ways in this business is certainly nothing new. When you live in a world of 30-day increments it’s hard not to have a warped perspective.) But that’s not the real issue here, because BMW started losing its way a good 20 years ago. And BMW management has only itself to blame.

It’s not hard to see how it went wrong for BMW. Back when the 2002 performance sedan began to put BMW on the map over here, it was because its products were light, agile and fun to drive, and that endured even through the larger 3 Series and the E12 and E28 generation 5 Series. The boxy sedans with the large greenhouses of glass and a unrivaled level of responsiveness simply looked and felt like nothing else on the road.

Back then, BMW didn’t try to build something for everyone. Instead, the company focused on creating machines that bristled with the company’s distinctive point of view on sporting motoring. And that meant building machines that were exactly what BMW engineers wanted to drive, machines that marched to a different drummer in almost every aspect. Rather than mold its machines to a particular buyer, BMW expected, make that demanded a higher level of interest from its potential buyers, people who would come to appreciate the performance capability and come to share the passionate point of view that defined BMW. This single-mindedness on BMW’s part created a brand aura that achieved cult-like status with a growing number of devoted enthusiasts who believed that they knew what the rest of America’s motoring public didn’t. It was truly powerful and served BMW well for years.

Then in 1975, Martin Puris, CEO of the Ammirati & Puris advertising agency, came up with one of the most iconic automotive advertising themes of all time. “The Ultimate Driving Machine” not only perfectly captured the unbridled passion that drove BMW to create cars that marched to a different drummer and delivered an unrivaled driving experience, it also stirred the souls of legions of enthusiasts who simply couldn’t get enough of the brand’s offerings. The theme was magic, creating an aura for the brand that was not only unmistakable, but one that would dramatically remain all its own.

(It’s interesting, but I distinctly remember some of the comments by Detroit car company executives back in the late 70s. The unifying theme of their comments seemed to revolve around the fact that BMWs were homely oddities and that they didn’t get what the big deal was. But by the time I went to work on the Pontiac advertising account in early 1980, the battle cry around Detroit revolved around doings things “just like BMW” even though few understood what that really meant. Suffice to say, the success of BMW rocked Detroit to its core.)

So what happened? To paraphrase Joe Pesci as Nicky Santoro in Martin Scorsese’s “Casino,” when he described their downfall with the haunting words, “Then, we f---ked it all up.” BMW indeed f---ked it all up, there’s no elegant way to put it. In other words, the little German automaker that marched to a different drummer and was renowned for building genuine driving machines with a distinct point of view got lost. And got greedy.

Enjoying almost unfettered success, the powers that be in BMW management started to linger a little too long on their glowing press reviews and began thinking that they could do no wrong, which led them down the path of believing that they could get one of their products in damn near every garage in America. So a relatively simple BMW product lineup that consisted of a few sedans, coupes and a distinctive wagon here and there got swallowed up by a burgeoning product lineup that grew more cumbersome by the model year.

BMW unleashed niche products on top of niche products that stepped on each other in the market. Their cars became bloated and heavy, and their crossovers and SUVs grew bigger by the day. Luxury and technology for technology’s sake replaced performance, and the distinct point of view that defined BMW slowly but surely began to slip away.

BMW was no longer building “Ultimate Driving Machines” - instead they were building facsimiles of what the brand once stood for designed to extract as much money from consumers as possible. Yes, there were certainly some standout M cars unleashed over the years that reminded enthusiasts of how great BMW used to be, but for the most part BMW had traded in its hard-won authenticity for a volume play based on faux representations of what the brand once was, all for $699 (and up) per month.

And this volume push from the factory proved costly, because not only did dealers have trouble keeping up with the product onslaught, consumers wandered off to greener pastures because the raison d’etre for buying a BMW was becoming harder to find. After all, what did BMW stand for again? Not only had BMWs become too ubiquitous, but too often its models had become lost in a cloud of “me-too” blandness. To make matters worse, the choices from the other manufacturers seemed just as good to consumers, if not better, than what BMW had to offer.

In short, BMW’s long, slow slide into mediocrity has taken its toll, and it isn’t the Ultimate Driving Machine any longer. It’s a car company pretending to adhere to the core beliefs that it once stood for, but this just in: it isn’t fooling anyone. It has simply lost its way.

I have no idea if Mr. Kuhnt has a clue, but I am quite certain of one thing: There are few auto companies in the world that have done less with more than BMW. And before Mr. Kuhnt does anything, he must answer two burning questions: As in why BMW? And why now?

Because a legacy is a terrible thing to waste.

And that’s the High-Octane Truth for this week.

(BMW)
The new BMW X3 xDrive (the M40i version shown above) is just what BMW dealers are clamoring for, allegedly. It’s supposed to be better in every way but based on an overview of the product that the company released, it’s hard to discern a compelling reason to buy one. Talk about a giant “we’ll see.”

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