THE AUTOEXTREMIST

September 2, 2009

BMW’s new mission: Getting its green on.

By Peter M. De Lorenzo

Detroit. After almost two decades of hammering home the brand positioning of “The Ultimate Driving Machine,” BMW is attempting to put its stake in the Shiny Happy Valley of noble green intentions with a new “M.O.” the company is calling “EfficientDynamics.”

Doesn’t exactly roll off the tongue, now does it?

When you remove those two key words “driving” and “machine” things seem to get lost in translation in a hurry, no? BMW is insisting, of course, that the BMW mission will not be compromised, suggesting that its new approach is to “reduce fuel consumption and greenhouse gas emissions while at the same time increasing the joy, the fun and the performance of the vehicle.”

The company is even showing something called the Vision EfficientDynamics concept at the Frankfurt Motor Show (see “On The Table” – ed.) beginning next week to demonstrate how a BMW of the future might take shape (even though it appears that the design team went on strike when they got to the back of the car, but that’s for another column).

All this remains to be seen, of course, as manufacturer pronouncements and the realities of the business usually tend to diverge at some point down the road, but BMW is clearly trying to leap frog its two primary competitors - Audi and Mercedes-Benz - by trying to “own” this performance-with-responsibility positioning.

Except that they’re a little – okay make that a lot – late to the green game. Audi is already well down the road with its clean high-performance TDI diesel, which they have been demonstrating – and winning with – on the race track for years now, so BMW has a ways to go before they can plant their flag in the green space and attempt to call it their own.

BMW is also trying to change the definition of luxury, or as they refer to it – “Premium in a New Age” – and that will be a tough road to traverse as well. All of the manufacturers are scrambling to understand the mindset of the consumer right now, and lots of hand-wringing is going on internally about the notion of luxury in our automobiles, and whether or not it has fundamentally changed because of the global economic meltdown and regional depressions that have ravaged this country.

I can save the manufacturers a lot of time and money because it's pretty simple actually. The bottom line is that until people have real hope - meaning sustainable careers and jobs and at least a glimpse of a brighter future - then luxury automobiles will be just that: a luxury. But when the economy does move into a meaningful, substantive recovery phase, then the demand for luxury and luxury performance vehicles will recover as well.

Timing this market transition – the perennial challenge for all automakers – will be the trick.

Will consumer attitudes about luxury actually change? Only so much that if you tell someone that they can have luxury, performance and be green while doing it then a larger percentage of people will opt to go that route. But, as always, it will come down to cost, and if consumers are confident about their personal financial situations, opting for a green tinge on their next ride – luxury or otherwise - will be easier to do.

The size of luxury vehicles will be another matter entirely, especially here in the U.S. It is going to be a painful transition for a lot of car buying consumers as they get used to the notion of smaller, more expensive vehicles that can still offer all of the features they crave. The majority of American car-buying consumers still don’t equate small with luxury or prestige, no matter how many predictions there are out there about how this will happen overnight. It won’t, unless of course we go back to $4.00/gallon gasoline – and stay there.

So into this brave new green world wades BMW, suggesting that “okay, now we’re in this game and we’ll show everyone how it’s done” - with arrogance blissfully intact, I might add - but it’s definitely not going to be easy, and it’s not going to be like flipping a switch for the “propeller brigade” by any stretch of the imagination.

That BMW is serious about their new mission in life, I have no doubt. In fact the chairman of The BMW Group, Norbert Reithofer, recently announced that the company would change its definition of “premium,” adding sustainability as an equal customer expectation to the classic BMW values of dynamic performance, quality and joy.

Hmmm. There’s that word “joy” again.

A few words of advice to BMW: As long as you never lose sight of the “joy” of driving, as long as you never lose that edge or the passion for creating great driving machines, you’ll be just fine. But if you waver or get sidetracked, you will lose your raison d’être – aka your mojo - in a heartbeat.

And if that happens, you will become just another car company.

We’ll be watching.

Thanks for listening.

See another live episode of "Autoline After Hours" hosted by Autoline Detroit's John McElroy, with Peter De Lorenzo and friends this Thursday evening, September 3, at 7:00PM EDT at www.autolinedetroit.tv.

By the way, if you'd like to subscribe to the Autoline After Hours podcasts, click on the following links:

Subscribe via iTunes:

http://itunes.apple.com/WebObjects/MZStore.woa/wa/viewPodcast?id=311421319

Subscribe via RSS:

http://www.autolinedetroit.tv/podcasts/feeds/afterhours-audio.xml