BUSINESSCAR AWARDS WINNER PROFILE: BMW reveals plans for a blistering future
15 June 2012
Dominating the BusinessCar Awards was just the start of what looks like being a spectacular year for BMW in fleet. Jack Carfrae finds out more
BMW ran rings around the other car manufacturers in the 2012 BusinessCar Awards, and is looking forward to a 2012 that will enhance the firm's appeal in the corporate marketplace, according to fleet boss Steve Chater.
Including the supermini category that its subsidiary Mini trumped, the German firm scooped a total of seven gongs earlier this year, including the flagship Business Car of the Year, Manufacturer of the Year and Green Model of the Year prizes.
The BusinessCar team has no say in the outcome of its awards because the winners are voted for by you alone, our readers. The reason the manufacturer and its products fared so well is because fleet managers and company car operators gave it the thumbs up.
The company's lower medium 1-series scooped the business car of the year award, proving that smaller, clean cars are very much top of consideration lists in the corporate marketplace, as long as they make the grade in other areas.
A bigger boot, additional rear passenger space and a more comfortable ride are the most significant improvements between the first and second-generation model, which, according to Steve Chater, BMW's corporate operations manager, are what has helped to put the new car head and shoulders above its predecessor in the sales charts: "The second generation relatively quickly outsold its predecessor week-on-week. There's greater packaging on the new car - greater rear space and boot space. Being second generation, people now understand what that car is.
"If we're being honest, Audi was the dominant force here with the A3, and when we started [with the original 1-series] we were outsold four-to-one. Now it's about two-to-one. Hopefully we can keep moving forward with that. We've now got the 116d with 99g/km - that puts us ahead [at least until Audi releases its 99g/km A3 later in the year]. The petrol engines have been phenomenally improved and there's a new appetite and desire for those. It widens the opportunities for the car, as does the fact it's a five-door, and gives us a nice breadth of product."
In addition to the success of its individual models, BMW has always had a strong presence in the business car market. Chater claims the company's success in the fleet sector is simply down to giving firms what they want: "We've got some very relevant products, but it's really down to what drivers and businesses need to maintain an effective fleet operation. Our average product age is only 2.3 years and the Efficient Dynamics technologies continue to set the benchmark in terms of economy and emissions."
As logical as that sounds, Chater claims the sector still demands a certain amount of appeal on the emotional front and there remains a case for having a powerful engine. "Look at the 320d Efficient Dynamics - it's a bit of a no-brainer really, when you see the figures," he says. "Other manufacturers have detuned their engines in order to achieve economy but we've been able to have engines with significantly more power as well as much lower emissions."
That same kind of appeal, that goes beyond low running costs, is something the firm has been trading on for the past 11 years since it began producing Minis. Always more of a retail brand, the company thinks it is now in a stronger position to appeal to fleets due to the presence of the larger Countryman model.
The addition of a bigger, five-door car comes as part of a drive to up Mini's presence in the corporate market, with the introduction of new staff specialising in boosting its fleet profile. "We've recruited a further 83 Mini local area development managers and that enables us to have a dedicated focus, which that brand needs. We have about 120 of those already for BMW," says Chater.
"This is a result of investment that has been growing over the past few years. It's down to things like the Mini Countryman, which offers a serious business proposition. We've focussed very much on the emotional purchase of Minis. I guess the emphasis has grown since the new models have come in and we now need to stimulate what the rational reasons are, which, with the Countryman, is its practicality features."
Company car sales now account for the lion's share of BMW's UK business, and Chater says the strongest area at the moment is coming from small businesses: "Fleet and corporate business is now around 60% and its importance to us as a manufacturer and to the dealers has heightened, and we were ahead of the curve in this respect. That share of corporate is critical in the current economic position.
"Where we've seen the strongest growth is in the SME arena, and in the BMW/Mini business partnership programme the customer comments really demonstrate the value of this within the SME arena. I think that will grow. The other strong area is end user corporates, so large corporate accounts. We've won a lot of new agreements. The vast majority of that business will continue to be funded through leasing. The leasing sector has become critical because that many people have moved away from cost purchase." The programme he refers to is designed for fleets running 50 cars or fewer and offers packages that are specifically tailored to smaller corporate users including contract hire offers.
Chater also says there is an increasing demand for four-wheel drive versions of conventional models among the fleet community, borne out by the introduction of the 3-series xDrive at the end of 2012. All-wheel drive saloon and estate BMWs are already available in mainland Europe, but this will be the first time in the UK.
"We've had feedback to suggest that there is desirability for four-wheel drive on a wider range of our products," says Chater. "This showed particular interest in certain regions, for example, in Scotland. If you look at the sales mix of Audis with quattro then this highlights the market potential. This year, we've not had such extreme weather, but the past few years have shown that customers do have a desire for four-wheel drive and the additional traction. We've also seen a lot more people fitting winter tyres in recent years.
"Improvements in all-wheel drive technology mean that there is not a significant increase in CO2 emissions, and customers will only buy a car with four-wheel drive if they need it."