[FogCityM3]

Great analogy & astute observations!

Originally Posted by CSBM5

The analogy that stands out in my mind is with IBM circa late 1980s. Gertsner's book about how he ended up being begged to take the job to save the company in 1993 is an interesting read as it was within a few months of bankruptcy with its cash flow situation at the time. How did it get in this position? Like how most big bureaucracies evolve, it got big, fat dumb and happy and milked its loyal customer base for all it was worth (and this was from a company known through its past as having the best management and management training in the world). Once that path is started, it's essentially unstoppable from within as you're viewed as a trouble-maker, not a team player, etc, should you try to reorient the path of the company.

BMW is guilty of milking the customer base as best they can (like how when things got a bit tough in 2008-9, they massively increased parts prices knowing that they could simply milk the customer for more...worked for a while, but one thing it did was greatly increase the market for "OEM" parts marketplace, so whether it was a long-term wise decision or not, time will tell, but the main issue is that NOBODY is measured anymore on long term wise decisions. What gets rewarded gets done, and short term success is what gets rewarded these days...to heck with the long term). They have relied on a reputation built over many decades, customer good will amassed by millions of hours of hard work over the years, and now the "wise" stewards in charge will gather up that good will and try to extract it from the marketplace in as quick of a time as possible. Why? Simply because that is what is rewarded in today's world. Measurements, bonuses, rewards are all based on near-term performance, and using up very strong and loyal customer good will can result in a few years of outstanding financial results (i.e. witness today's situation ).

Which all plays into the main focus of large companies like BMW. It's long ago left being about the end user, the customer, and turned into a game of financialization all focused on the short term, next quarter, next year's numbers.

[ddk632]

Originally Posted by Mr.Metak2you

Why make such blanket statements? Since I've graduated college I have exclusively owned a string of BMW's mostly Mcars. I've never owned an Audi but like several things they are putting out. The S/RS7 is stunning IMO. Of course the R8(Audis flagship supercar) is the obvious one. Some criticized that BMW was compared to Toyota but they have more similarities than MB or Audi to Toyota. Hell they even have a new partnership to make cars together. Neither Toyota or BMW has any interest in making anything remotely similar to the SLS or R8. Sure they like to talk about the Supra or M1 in concept form but decades go by and nothing. The i8 is an awesome car that is ahead of its time and I would have been interested in buying but as Scott already pointed out they are sold out already. Of course BMW won't say how many have been sold, 500, 1000...?

At any rate. If you are a life long BMW fan like myself, it is in our bet interest for MB and Audi to make awesome cars. The competition will result in better BMW's. If it doesn't , well BMW will see droves of people leaving for greener pastures....

Well Toyota made the LFA and are coming out with a hybrid halo car, the LF-LC. The LFA is a true supercar. As much as I have personal reasons for hating Lexus brand, respect is due where respect is deserved.

And if you want an i8 you can put a deposit down for a 2015, it's only the 2014 allocation that is sold out (based on deposits, remember, not actual orders which don't exist yet).

But I agree with you that competition is good. As enthusiasts we all love the halo cars and super cars and top of the line AMG and M cars, and I for one would love to see BMW put out an M7 or M1 successor also ... But as stated many times, it's the bread and butter family sedans and SUVs that sell in the highest numbers which contribute to these luxury sales statistics.

[Never Convicted]

Originally Posted by CSBM5

The analogy that stands out in my mind is with IBM circa late 1980s. Gertsner's book about how he ended up being begged to take the job to save the company in 1993 is an interesting read as it was within a few months of bankruptcy with its cash flow situation at the time. How did it get in this position? Like how most big bureaucracies evolve, it got big, fat dumb and happy and milked its loyal customer base for all it was worth (and this was from a company known through its past as having the best management and management training in the world). Once that path is started, it's essentially unstoppable from within as you're viewed as a trouble-maker, not a team player, etc, should you try to reorient the path of the company.

BMW is guilty of milking the customer base as best they can (like how when things got a bit tough in 2008-9, they massively increased parts prices knowing that they could simply milk the customer for more...worked for a while, but one thing it did was greatly increase the market for "OEM" parts marketplace, so whether it was a long-term wise decision or not, time will tell, but the main issue is that NOBODY is measured anymore on long term wise decisions. What gets rewarded gets done, and short term success is what gets rewarded these days...to heck with the long term). They have relied on a reputation built over many decades, customer good will amassed by millions of hours of hard work over the years, and now the "wise" stewards in charge will gather up that good will and try to extract it from the marketplace in as quick of a time as possible. Why? Simply because that is what is rewarded in today's world. Measurements, bonuses, rewards are all based on near-term performance, and using up very strong and loyal customer good will can result in a few years of outstanding financial results (i.e. witness today's situation ).

Which all plays into the main focus of large companies like BMW. It's long ago left being about the end user, the customer, and turned into a game of financialization all focused on the short term, next quarter, next year's numbers.

Well, at least you're not bitter about it.

Sounds like someone got "downsized." Wells or BofA? Now tell us about when movies cost a nickel and how you used to walk barefoot to school to save your shoes.

[mPlasticDesign]

Originally Posted by ddk632

Well Toyota made the LFA and are coming out with a hybrid halo car, the LF-LC. The LFA is a true supercar. As much as I have personal reasons for hating Lexus brand, respect is due where respect is deserved.

And if you want an i8 you can put a deposit down for a 2015, it's only the 2014 allocation that is sold out (based on deposits, remember, not actual orders which don't exist yet).

But I agree with you that competition is good. As enthusiasts we all love the halo cars and super cars and top of the line AMG and M cars, and I for one would love to see BMW put out an M7 or M1 successor also ... But as stated many times, it's the bread and butter family sedans and SUVs that sell in the highest numbers which contribute to these luxury sales statistics.

I totally agree the LFA is awesome and a super car by every definition. Problem is the accessibility of the car. It's not a "real" car. When was the last time you saw one driving down the road? When it first came out it was offered as a lease only and Toyota/Lexus practically hand picked most of their customers looking for "high profile" individuals. I see Aventadors, Carrera GT's, Ferrari's, R8's, SLS's...almost on a daily basis driving in the SF Bay Area. I've never seen an LFA. I fear the i8 is going to be the same. A car that looks great at car shows and magazines but never to be seen in the wild.

[FogCityM3]

I don't disagree with your observations of typical customers, but I think you have to step back and look at the reasons why Porsche has been so successful, not in terms of size, but in terms of profitability (is the most profitable auto co in the world). Porsche took the 911 and honed it to perfection for 50 years, despite its initial shortcomings. Investing and reinvesting, making it better and more competent. I don't think there's any single car from any manufacturer that has achieved iconic status like the 911 for as long as it has, other than the VW beetle. But the iconic status is also due to being a performance leader. All of Porsche's cars are leaders in their respective categories, including the SUVs and large sedans and this reinforces the brand image.

As you stated, the reason why most people go in to buy a Cayenne is because of the halo effect of the Porsche brand and what it means to them at the most common denominator level, which really comes down to brand image and exclusivity. But that brand image was earned and continues to be earned by Porsche in cars like the 911 & Cayman, whose success is determinant of why someone would even consider buying a Porsche SUV. This is why I think BMW needs to really continue investing in its core/enthusiast roots and not ignore the very principles, values, and customers that got them to this point in the first place.

The problem is that BMW is no longer producing sufficiently differentiated products and is trying hard in being everything to everyone, which I believe is hurting the brand image. Also, even though many customers don't read auto magazines or are not really into their cars, who do they ask for advice? I can't tell you how many people ask me my opinion of various car brands / end up buying because of my advice, and I know my enthusiast friends get asked the same questions all the time. This is why the core enthusiast customer matters, which one would think in this age of 'viral marketing' a company should cater to the informal 'opinion leaders' first and foremost, let alone listen to them.

Originally Posted by ValeYellow46

I work at a dealer and most dealers I know have a waiting list a mile long for the new X5. If we would have had more of these to sell BMW would have won. This is the real reason we didn't win, not because we aren't selling cars for enthusiast. Enthusiast don't spend money like "normal" people do. For every 100 clients who buy BMW's, about 1 or 2 of them know anything about the cars, history or passion behind BMW. I think people on here think all car buyers are like them, they aren't. They are normal people who like 328xi's and don't know what steering feel even is or what an E90 is. The enthusiast are typically stuck in a time morph driving their E46 ZHP and E39 540i. Don't get me wrong some enthusiast spend a lot of money on new cars but typically they don't keep a brand alive. Porsche is known as an enthusiast brand but they sell more Cayennes than all other models, most of the those buyers could care less about steering feel of the 991 v the 997. Sorry to rant but so many people here are negative towards everything BMW does and it gets annoying after awhile.

[ddk632]

Originally Posted by Mr.Metak2you

I totally agree the LFA is awesome and a super car by every definition. Problem is the accessibility of the car. It's not a "real" car. When was the last time you saw one driving down the road? When it first came out it was offered as a lease only and Toyota/Lexus practically hand picked most of their customers looking for "high profile" individuals. I see Aventadors, Carrera GT's, Ferrari's, R8's, SLS's...almost on a daily basis driving in the SF Bay Area. I've never seen an LFA. I fear the i8 is going to be the same. A car that looks great at car shows and magazines but never to be seen in the wild.

That's a good point - I've never seen an LFA in the wild, either, and I'm in South Florida where exotics and supercars are plentiful.

I think the i8 will be difficult to catch in the wild also, but not as bad as the LFA. The first year BMW I think purposefully is producing limited numbers, the second year should be more but who knows.

I have a deposit down for a 2015 i8, so I know I'll see at least one in my area

When I met the BMW i Brand Manager at a private BMW i8 event in Miami last month, we asked him about this and he likened the i8 in terms of exclusivity and rarity to the Z8 of the early 2000's.

You don't see many Z8's but especially in LA, Bay Area, NY, and SoFla they are out there. I think i8 will be similar to the Z8.

[CSBM5]

Originally Posted by Never Convicted

Well, at least you're not bitter about it.

Sounds like someone got "downsized." Wells or BofA? Now tell us about when movies cost a nickel and how you used to walk barefoot to school to save your shoes.

No, not at all. I left what was left of IBM back then 22 years ago at the peak of my 10-year career there and a promotion offer to stay, but I was on a different path of starting my on firm, a private hedge fund, and haven't looked back once in remorse since then. Best decision I ever made. If people don't recognize the disease that engulfs large, bureaucratic organizations as I outlined, they will at some point in their future most likely.

Cheers,
Chuck

[paradoxical3]

Originally Posted by FogCityM3

I don't disagree with your observations of typical customers, but I think you have to step back and look at the reasons why Porsche has been so successful, not in terms of size, but in terms of profitability (is the most profitable auto co in the world). Porsche took the 911 and honed it to perfection for 50 years, despite its initial shortcomings. Investing and reinvesting, making it better and more competent. I don't think there's any single car from any manufacturer that has achieved iconic status like the 911 for as long as it has, other than the VW beetle. But the iconic status is also due to being a performance leader. All of Porsche's cars are leaders in their respective categories, including the SUVs and large sedans and this reinforces the brand image.

As you stated, the reason why most people go in to buy a Cayenne is because of the halo effect of the Porsche brand and what it means to them at the most common denominator level, which really comes down to brand image and exclusivity. But that brand image was earned and continues to be earned by Porsche in cars like the 911 & Cayman, whose success is determinant of why someone would even consider buying a Porsche SUV. This is why I think BMW needs to really continue investing in its core/enthusiast roots and not ignore the very principles, values, and customers that got them to this point in the first place.

The problem is that BMW is no longer producing sufficiently differentiated products and is trying hard in being everything to everyone, which I believe is hurting the brand image. Also, even though many customers don't read auto magazines or are not really into their cars, who do they ask for advice? I can't tell you how many people ask me my opinion of various car brands / end up buying because of my advice, and I know my enthusiast friends get asked the same questions all the time. This is why the core enthusiast customer matters, which one would think in this age of 'viral marketing' a company should cater to the informal 'opinion leaders' first and foremost, let alone listen to them.

Absolutely could not have said it better myself. 100% bang on, anyone who doesn't get this should read Malcom Gladwell's the Tipping Point.

[Vervain]

Originally Posted by Kwando

Love what MB has been churning out lately. CLS, S-Class and G63

My thoughts exactly! My top 3 favourite MBs. The G63 is my dream car

[ska///235i]

Everyone just man up and face the fact that merc is making better cars

[ZooMMM]

So far have owned 2 BMWs and 1 MB. Will always be a BMW guy. But admittedly MB are churning out good cars. Good, solid performers. Blowing out M cars even. That, plus improving looks and feel.

We are here as BMW owners and forum members. But I have to admit, sometimes the only thing keeping me from getting a MB over a BMW is the 4year maintenance plan!!! Lol. I've been burned with MB maintenance costs before and thus BMW gets a lead in this category. Hehehe.

[ramuman]

Originally Posted by Suave

The F8x launch in Jan will give BMW a jump start in the new year. Also with the models coming in 2014 this will be short lived for Mercedes

A relatively low production M3/4 that won't be delivered until halfway into the year will help sales? I suppose the i8 will also make a notable contribution to sales.

The 1, which doesn't even have the current incarnation in the US, and the X models are positively boring. The S leads the 7.

That said, I am positive that BMW is the first mass production luxury brand to really be pushing with CFRP, and they're beating Audi and MB in the FI game - but it'll take awhile for the public to notice or care. While every current MB sedan and coupe looks like it started melting and was then frozen, there is an appeal to a cheap a MB.

I'm guessing the 2 series will help. I would venture a bet that since the CLA is a different model, despite it being the lowest end Mercedes, people buying it probably don't feel it's a lower in the lineup than the C class. You certainly would feel that about the 320i and the 1 series is literally a decade old here in the US.

[Suave]

Originally Posted by ramuman

A relatively low production M3/4 that won't be delivered until halfway into the year will help sales? I suppose the i8 will also make a notable contribution to sales.

The 1, which doesn't even have the current incarnation in the US, and the X models are positively boring. The S leads the 7.

That said, I am positive that BMW is the first mass production luxury brand to really be pushing with CFRP, and they're beating Audi and MB in the FI game - but it'll take awhile for the public to notice or care. While every current MB sedan and coupe looks like it started melting and was then frozen, there is an appeal to a cheap a MB.

I'm guessing the 2 series will help. I would venture a bet that since the CLA is a different model, despite it being the lowest end Mercedes, people buying it probably don't feel it's a lower in the lineup than the C class. You certainly would feel that about the 320i and the 1 series is literally a decade old here in the US.

I know the F8x is a low volume car but what it will do is create a lot of buzz and marketing for BMW That will steer many into their top selling non-m cars like the 3-4 series. The 2 series will also sell big.

I also predict that BMW will offer more aggressive offers and pricing in response to losing the sales crown. I for one would be thrilled for no dealer allocations for f8x ED, and favorable interest and residuals to get a surge of these cars on the road....billboards on wheels

[Suave]

Originally Posted by ZooMMM

So far have owned 2 BMWs and 1 MB. Will always be a BMW guy. But admittedly MB are churning out good cars. Good, solid performers. Blowing out M cars even. That, plus improving looks and feel.

We are here as BMW owners and forum members. But I have to admit, sometimes the only thing keeping me from getting a MB over a BMW is the 4year maintenance plan!!! Lol. I've been burned with MB maintenance costs before and thus BMW gets a lead in this category. Hehehe.

You nailed it..the maintenance plan is huge! Nearly everyone I know always says that the maintenance is a strong factor and often the tiebreaker for buyers. It certainly is a huge comfort for me with the price of M parts/maintenance

[ramuman]

Originally Posted by Suave

I know the F8x is a low volume car but what it will do is create a lot of buzz and marketing for BMW That will steer many into their top selling non-m cars like the 3-4 series. The 2 series will also sell big.

I also predict that BMW will offer more aggressive offers and pricing in response to losing the sales crown. I for one would be thrilled for no dealer allocations for f8x ED, and favorable interest and residuals to get a surge of these cars on the road....billboards on wheels

You and I will be doing our part .

[auf Deutsch]

FWD CLA250s will be everywhere by Q2. I thought C300s were abundant, but the CLA will be as hard to spot as taxis in NYC.

[ADRQ0811]

Well I had a Benz once (2012) although it looked nice and all I hated that thing it wasn't a BMW never will be,I'll stick to BMWs maybe i will pick up a Benz again but only have a bimmer at the same time so I don't miss it just my 2 cents

[RazBimmer]

Is BMW a failure now because It got outperformed by 3k units? Anyway, the competitive environment is healthy and will always push companies to improve their proposition and review their strategy if needed..

[Imola.ZHP]

CLA's started arriving just in time.

[The Automotive Enthusiast]

Originally Posted by ybbiz34

Actually they do, it's called the AMG Sport Package and features AMG wheels and other more aggressive design cues. They just choose not to plaster the AMG logo everywhere (and thus, people think the package does not exist).

Which is why I love Mercedes, they're not milking the AMG brand. The AMG Sport Package is basically like the on M Sport Package.

[georgere]

Originally Posted by ManiacGT

Because IMHO Merc make nice looking cars at the moment. BMW are churning out some fugly cars. BMW drive better by miles but they really need to get a new design team!

+++++1

[addm]

Really people are so fond of CLA in this thread I thought it is a competitor to M3/4. It is a front wheel drive for god's sake with nothing exceptional except may be the option of AWD which is not available right now. I will rather take a accord v6. People are buying it only for the brand name.
I also hear a lot of comments about boring design of F30. F30 has been criticized for anything but boring in design. Some says it is overdone. Boring is A4, A6 and A8 and the new A3.
MB actually has been under lot of pressure to increase their sales because of decrease of global market share. There is lot of discount of current generation C class which is why it is selling so well. C class is at the bottom of reviews most of the time comparing to BMW, Audi or even Lexus.
MB felt the heat some time back and is coming up with new products like the new gen C class which looks awesome. CLA45 is something special too. Competition I guess is good in long term is you want to survive.
People are arguing about sales difference of 3000 cars which is negligible over a year especially considering backorder for X5. Only thing BMW need to worry about is sales of X3 which is consistently below the competitors.