Deep Dive: The Future Of BMW’s Project I Product Plans

Hey guys, I´ve just read this fantastic article from Georg Kacher, who is, IMO, the very best journalist of the german car industry. Hope you enjoy it.

http://rumors.automobilemag.com/deep-dive-the-future-of-bmws-project-i-product-plans-143073.html

Where did they get those crazy numbers?????!!!!! 100k for i3, and 10k for i8???

As far as I know BMW plan to produce about 30,000 units of i3 per full year (that was officially confirmed by Head of BMW AG Sales & Marketing).

No info on i8 production volume yet. But with the rumored price tag way above €100k 3,000 units per year will be a magical number.

BMW i ... just like BMW M ... will be a niche brand, not a high-volume one.

So 100k unitis of i3 & 10k units of i8 per year is a pure BS!

We uses to be right almost 95% when talking about MB. And pretty accurate when talking about any other german brand. I give him pretty much credit.

There are 4 cyl a8 & s class ? oO

Not this time. Target of 30k/year of i3s has been confirmed by BMW AG Head of Sales & Marketing in an interview for AutomotiveNews. I really don't know where Kacher got those numbers from (100k of i3s & 10k of 18s per year) but they are ridiculous. And everybody who knows automotive industry a bit, knows that.

BMW plans to sell at least 30,000 units a year of its i3



Read more: http://www.autonews.com/article/20110226/ANE/110229885#ixzz1w9sv6bsc

BMW NOT PLANNING FOUR-CYLINDER 7-SERIES
Mercedes-Benz is about to launch a four-cylinder version of its flagship S-Class model, but don’t expect cross-country rival BMW to follow suit. BMW says it has no plans to offer a four-cylinder variant of its top-level 7-Series sedan.

In a bid to satisfy wealthy buyers with an eco-friendly side, Mercedes-Benz will soon launch a version of its S-Class sedan with a 2.2L four-cylinder diesel engine. The S250 CDI generates 204 horsepower and 369 lb-ft of torque, but the real emphasis is on the car’s Imperial rating of 42mpg.

Despite the obvious fuel-savings advantage, BMW says it will not follow Mercedes down the four-cylinder path. “I like selling 7-Series cars with six- and eight- cylinders,” said BMW CEO Norbert Reithofer. However, BMW will soon launch a hybrid version of its flagship 7-Series.

BMW recently shuffled its U.S. 7-Series lineup, ditching the previously standard eight-cylinder engine for a more fuel efficient six-cylinder unit.

http://www.germancarforum.com/community/threads/no-4-cylinder-for-7-series.35732/

10k/year of i8s sold is even more moronic claim Kacher came up with.

i8 is an exotic sports car. Very niche! It's a single model (2+2 Coupe).
And with all the tech on board it will be technological state-of-art, and the price will definitely mirror that: north of €100k.

Porsche is able to sell about 20k of its iconic 911s per year.
Audi sells about 2k of R8s per year, and about 1.5k R8 Spyders.
Total annual sales of ALL BMW M cars is about 17k per year.
Record sales of 6er Coupe peaked @ 13k in a year.
etc

So, 10k/year for an i8 is a delusion!

There is no intention for maximum volume on the BMWi cars , They are not Volume cars and are not intended to be mass volume cars. BMW like to think of the BMWi cars as automotive gadgetry , like an ipad or an iphone something that does the intended job it was supposed to do but in an entirely different way. Potentially the cars do speak of this , both the BMW i3 and the i8 Spyder fresh from Beijing are now on show at the Cannes film festival , but there is still much to do in regards to BMWi as we are in the process of a World Tour which will begin in Rome and travel around the globe as well as the high tech interfaces needed for our Specific BMWi Boutiques located with many of the worlds mega cities.
BMWi cars will not be sold from all BMW dealers.

Another thing completely overlooked is BMW's attention to profitability, it was important to establish a higher rate of profitability around 10 years ago which has been successfully implemented in the current 5,6 and 7 who now gain a higher rate of profitability than the previous E60,E63 and E65. The new 3er and 1er are also more profitable than the previous models. And BMW are currently integrating the UKL/MINI to be more profitable. As of now MINI makes its money via personalisation on the Oxford built cars as the profit margin on the car is razor thin , integrating that with the BMW FWDs and they will earn a higher rate of profit on car aswell as personalisation.
The integration of the next generation of Rolls-Royce's into BMW's next gen. Lightweight matrix will also help increase profitability.
The current RR Ghost which is approaching its 3rd Birthday still has a 12 month wait for a new vehicle order.

When you think of the cars that are inbound... again they are cars on which good money can be made from them due to the existing and future matrix modular architecture which can be adapted to each model whether volume or niche.
Nobody within BMW is expecting BMWi to be such an overnight success to begin with , like previous BMW new segment or new niche models or indeed MINI and Rolls-Royce there will be the establish period.
This time around it will be an easier transition as BMW will have a line up of products that return a higher rate of profit per car than previously. Allowing an offset for BMWi to run at its own pace and become established.

I do recall the original statement of 30K units of i3 but maybe costs have increased to the point where the number crunching has demanded 100K to make it viable. It's a hell of an undertaking without an additional partner, maybe this might be their next step?

P.S.
I even question whether 30K is possible with the i3, it takes a lot of caring for the enviornment to want to swap your 335i for this?

Rumored i3 price for German market is €45,000 (so, same price bracket as 335i & 330d).

Eg. Opel Ampera (rebadged Chevy Volt) costs €44,000 in germany, and Nissan Leaf's price starts @ €37,000.
USA: i3=$45,000 (rumored), Volt=$39,000, Leaf=$35,000 (MSRP prices w/o tax credits included!)
So paying 15% for an electric BMW over electric Chevy, and 30% over electric Nissan isn't such a bad deal. Premium (badge) has it's price.

Sure electric cars aren't cheap. And are therefore still very niche.

Who in their right mind when given the choice between an Opel Ampera and a BMW 335i/330d would go for the Opel?

It's completely mental.

^For 2011 the US market bought a total of 8,720 LEAFs and 6,142 Volts and worldwide Nissan didn't quite make the 20K mark though they are expecting 40K for 2012. There's a slim possibility that BMW could sell 30K i3s in their first year but that would be exceptional so where this figure of 100K has come from is anyone's guess but Georg Kacher is a person that usually has his finger on the pulse, if true then it's total pie in the sky projections at best.

Loaded treehuggers?

I doubt development costs would have necessitated a revised estimate of 3-fold over the original target. Generally, a manufacturer would already have an idea of what a particular market will bear and either raise prices as necessary or take a hit in profitability. It's not likely they will suddenly look to expanding a customer base by 233% if it didn't originally exist.
As for the 335i, you wouldn't need 335i drivers to swap over to hit 30k. There will be some 123d drivers who like the brand and want to try something new and efficient. Ditto for some 3er diesel drivers. There may also be current Golf/A3/Mini drivers looking to move on to something new and economical, maybe some Mazda3/Kia/Focus types who, having attained a bit higher financial levels, would like to try something new, economical, and premium. Some Prius or Civic hybrid owners may also be intrigued by a higher level of economy as well as the promise of driving dynamics. Before, they may have sided with economy in a battle against fun. It's possible the i-cars no longer make this an either/or proposition.

I very much doubt Focus/Golf drivers will be making the switch (lol) and I'm not so sure 1 or 3 series owner will either. This is at best a second/third car purchase so the most likely of customers are ones driving one possibly two high end motors (big saloon or SUV) and want to give the outward appearance of being green.

I think it's very possible that some current Focus/Golf drivers, having climbed up financially since when they first bought their car, might want to make the switch. Or are you saying they will be Focus/Golf drivers forever regardless of their income rising? I think it's reasonable to guess that some might. If you're saying that big saloon/SUV drivers will buy this car, then you should have no reason to believe 30k is out of reach; it's not as if there aren't a lot of big saloon/SUV owners out there. Then there are those people living in densely populated, highly congested areas where driving/owning a big saloon or SUV would be impractical and more expensive.

^Guibo the percentage would be so low as to almost not register but I'm not going to debate this with you because you have your opinions and I have mine. I will say this there is a possibilty that at the time the 30k unit prediction BMW didn't think they would enter a war with VAG that would require taking a controlling stake in their CF partner, so I reckon extra unforeseen expenses entered the i program that might explain the need for greater sales.

How do you know the percentage would be so low as to not even register? What % are you talking about? I don't think you could possibly know, especially considering you can't even answer the question as to what BMW's "core customer base" is.
Tell me the known effects of this war with VAG over their stake in SGL. It simply doesn't make sense for BMW to suddenly think there are going to be 233% more customers than what they had originally targeted. If anything, with financial meltdown of the US and now the problems in the euro zone, BMW should have been thinking to revise their estimates downward. Not upward and by a factor of over 3:1.

BTW, Georg Kacher has sometimes been wrong with his estimates in the past, even on the same exact model. For example, with regard to the ZR1, here's what his First Drive online review posted in 2008 said:
"Just 1800 ZR1s will be built each year at GM’s plant in Kentucky, with production ending in 2012."

And here's what his First Drive print review said:
"Around 80,000 GBP will buy you one of only about 25 examples destined for the UK (of a total build run of 1800 between now and 2012)."

Considering GM had already built about 3800 ZR1s through June of 2011 (and one further year of production yet uncounted), I'd say his estimate of 1800 total is the wrong one.

And there are lot of them especailly here in heart of Silicon Valley - I personally know 3 people with money down for Karma. Not to mention the hordes of Prius owners that clog the left lane - I am guessing at least a fraction of them would love to upgrade to something premium. When it comes to hybrids/EV, American market is ahead of Europe.