5 Series and X3 not under-performing: BMW boss

BMW Australia is confident in its ageing 5 Series and X3 models despite them being comprehensively outsold by newer rivals, with the company’s local chief pointing to the brand’s dominance in overall SUV sales as the more critical factor.

The existing 5 Series was launched in 2011 and is due for replacement next year with a new generation tipped to debut at January’s Detroit motor show, however to June 2016 the even older Mercedes-Benz E-Class – the current generation arrived in 2009 – has outsold it by 50 per cent.

Asked whether he was concerned about the arrival of the new-gen E-Class this month, BMW Australia managing director Marc Werner did not directly respond but stressed that it was fairer to combine the volume of the similarly priced large passenger car and large SUV segments.

“I always look at the balance in that particular segment, for example X5 and 5 Series combination versus E-Class and ML or GLE now,” he said. “If you look at that balance we are clearly in the lead and that is what is essential.”

Mr Werner also declined to indicate ways BMW could improve the sales performance of the 5 Series, suggesting that market trends away from passenger vehicles towards SUVs was to blame for the decline.

The $70K-plus large passenger car segment has dropped by 22.1 per cent year to date to 12,480 sales, with the E-Class (437 units, down 23.2 per cent) leading to June 2016 ahead of the 5 Series (291, down 15.5 per cent), leaving the Audi A6 (258) and Jaguar XF (231) chomping at its heels.

Mr Werner turned that drop into a positive overall: “There’s certainly a shift from the traditional sedan vehicles to SUV cars and we are certainly at the forefront of picking up those trends from a consumer perspective and certainly that’s why we are so successful.

“A couple of years ago we were at 20 per cent (SUV share of total BMW sales), last year we were at 45 per cent and this year already we are at 50 per cent and if that trend continues the SUV cars will be the predominant concept in the Australian market,” he added.

The $70K-plus large SUV segment has soared by 23.2 per cent over the same period to a dominant 13,119 sales, with the X5 leading (2415 sales, up 5.0 per cent) followed by the Audi Q7 (1569, up 94.7 per cent) and newly launched Mercedes-Benz GLE (1481 versus 1181 last year for the ML it replaced).

The GLE Coupe (432) has, however, outpaced the X6 (345) to the mid-year mark.

The $60K-plus medium SUV class has exploded to an even greater degree, up 59.4 per cent year to date with 14,789 sales. Leading the charge is the newly released Mercedes-Benz GLC (2726 units) and Land Rover Discovery Sport (2256), both outpacing the X3 (1997) that is also due for replacement next year, although the X4 (763) helped close the gap for the brand, as Mr Werner explained.

“The X3 for example is now in its sixth year of its lifecycle and year to date sales are up 21 per cent (and) we’ve never sold as many X3s as before and we need to take a look at the X4 in particular,” he said.

But Mr Werner did not wish to entertain the sales combination of the Mercedes-Benz GLC-Class and X3 medium SUVs with their C-Class and 3 Series medium passenger car equivalents, except to say sales of GLC have been, “at the expense of the C-Class.”

The $60K-plus medium passenger car segment has fallen 4.6 per cent to 12,480 units and below medium SUV volume, with the C-Class (3272 sales, but down 32.6 per cent) still leading the 3 Series (2562, up 27.3 per cent) and Audi A4 (1314, down 3.4 per cent).

Unlike with 5 Series/X5/X6 (3051 units) versus E-Class/GLE/GLE Coupe (2350), however, C-Class/GLC sales (5998) continue to outstrip that of 3 Series/X3/X4 (5322) and Benz’s GLC Coupe is still to come.

But Mr Werner believed such new rivals, in addition to the Jaguar F-Pace that launched locally last week, was a good thing for the X3 and X4 duo.

“I always see it as a positive to be honest, because at the end of the day it is the customer who decides what he or she wants, and it’s positive for the entire segment,” he said, before rejecting the assertion that BMW SUV growth was the singular focus.

“We are growing passenger cars as well as SUVs, but we are over proportionally growing in SUV,” Mr Werner added.

BMW Australia sales of 15,754 units to June 2016 is up 25 per cent year-to-date with growth outperforming Audi (12,159, up 7.2 per cent) and premium manufacturer leader Mercedes-Benz (20,681, up 15.6 per cent).