Wednesday, September 23, 2009

Mini points to revamped BMW image

By Jorn Madslien
Business reporter, BBC News, Frankfurt

The buzz around Mini's launch of new models at the Frankfurt motor show last week brought fresh hope for the future for factory workers in Oxford. The models may also point to the future of parent company BMW.

Mini Coupe and Convertible Roadster
Mini has launched two new models at Frankfurt

The two-seater coupe and convertible roadster are both concept cars, though their future as production cars has already been decided.

Both will be produced alongside existing Mini-derivatives, the standard hatchback, the convertible and the Clubman. But first, production of a four-door 4x4 cross-over model will begin this winter.

"We will open up a new segment with this car," says Ian Robertson, BMW Group sales and marketing director, though he expects the coupe and the convertible to remain niche products.

Mini's growing model range is doing much to firm up Mini's role as a marque in its own right within the BMW Group, Mr Robertson tells BBC News in an interview.

And "there are plenty of other ideas" for forthcoming models that will further extend the brand, which has already sold 1.5 million cars since its relaunch in 2001.

Evolutionary process

Both the coupe and the convertible have lower roof lines and a lower centre of gravity than previous Minis.

MOTOR SHOW COVERAGE
Bentley Mulsane

As such, they are taking Mini in a new design directions.

When BMW's first Mini was launched a decade ago it had been designed by Frank Stephenson, who went on to design Fiat's retro-model and Mini-rival, the Fiat 500.

"In practice, the Mini had been left unchanged since the first model in 1959," Mr Stephenson, who now works for McLaren, tells BBC News in an interview.

So to come up with a model that looked right for the turn of the century, he "designed a Mini for 1969, one for 1979 and one for 1989, the way they would have looked had the brand gone through an ordinary evolutionary process", he explains. The 1999-design was then chosen for production.

Electric Mini

A decade on, Mini is emerging as a test-bed for BMW's Project I, an autonomous division within the group which is working to identify what the future will bring for the motor industry - both in terms of how cars are powered, as well as in terms of new materials, how cars will be used and how they are paid for.

In the past, for example, "engines and vehicles aged together", Mr Robertson explains. This may no longer be the case in the future, in particular in the case of electric vehicles such as the Mini E which is currently being marketed to customers prepared to take part in research.

Mini E
The Mini E is a two-seater driven by a battery

Like Mini's new coupe and convertible, the Mini E is also a two-seater, largely because the rest of the car is taken up by its huge battery.

"There hasn't been a two-seater Mini for a long time," says Mr Robertson. "The last one was a pick-up."

This seems to make the coupe and convertible ideal hosts for the company's electric car ambitions, though Mr Robertson will not confirm this.

Instead he focuses on how "battery manufacturers are advancing so fast at the moment" so "batteries are getting smaller and less heat generative", hence it is not a given that they will still take up so much space in the future.

The crossover has also been muted as a likely electric model; its elevated stance could help make space for batteries.

Green premium

But the electrification of BMW Group cars is not expected to be limited to Mini.

For a while, the group had been considering the launch of a fourth brand alongside BMW, Mini and Rolls-Royce as the basis for its electric car development.

BMW concept car
BMW's concept cars hint at a zero or low emission future

As part of a "new focus on sustainable vehicle technology", electric cars are instead expected to emerge across the group's marques, as "the marketing department believes that it will not be regarded as a premium brand in the future if it does not become overtly environmentally friendly", according to analysts Global Insight.

"BMW believes that 'premium' will increasingly come to be defined in terms of environmentally compatible vehicle technology," they observe, so the company is "planning for full electric and hybrid versions of most models".

Mr Robertson confirms that "sustainability, as you've seen from the show downstairs, is at the heart of everything we're doing".

"We have that within our philosophical discussions [and] continuing down that road, with that as the underpinning of the company, is a big competitive advantage for the BMW Group."

World leader

Regulatory requirements, such as "the imminent deadline of limiting carbon emission from new vehicles to 120 grammes per kilometre by 2015", and "a slew of tax penalties introduced to discourage... high emissions" have also encouraged BMW's change of heart, reason analysts BMI Western Europe Automotive Insights.

"BMW is cautious that without such technology, carmakers 'may no longer be in the market'," they say.

But regardless of BMW's underlying motives, there are clear indications that the strategy is bearing fruit.

BMW car
BMW's average emissions have fallen sharply in recent years

Earlier this month, for the fifth consecutive year, BMW Group was rated the world's most sustainable automobile manufacturer in the Dow Jones World Sustainability Indexes, calculated jointly with Sam, an investment house that focuses exclusively on sustainability investing.

Even chief rival Daimler, which owns Mercedes and Smart, is prepared to accept Mr Robertson's claim that "we are pushing the emissions of our fleet down faster than anybody else".

"There's no doubt that BMW, four or five years ago, decided to roll out new technologies - mostly conventional technologies that we had as well - in a broader scope than we did," Daimler's chief executive Dieter Zetsche acknowledges.

"Therefore [BMW] had some greater improvements in CO2 reductions last year than we did," he says.

But he is also eager to stress that Daimler has been catching up "so today we have closed the gap".

BMW may have been the first of the luxury car makers to have smelt the coffee and this may have enabled it to steal a march on its rivals.

But staying ahead of the pack is not going to get easier as time goes by.

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