BMW is looking to expand its current lineup by pushing into the small car market in a big way. For decades, the German luxury brand relied on the 3 Series coupe, sedan and wagon to serve as its entry-level option until the introduction of the smaller and somewhat more affordable BMW 1 Series (pictured) in 2004. While the brand plans to expand 1 Series offerings in North America to include a potential five-door model to complement the existing coupe and cabriolet, until recently there has been no indication that an even smaller BMW vehicle might be in the works.
Until this week, that is. BMW announced that it will aggressively pursue the development of new small car platform to be shared between vehicles branded with the roundel and its captive MINI subsidiary. BMW's chief executive Norbert Reithofer said that the decision was made due to the steady growth seen in the premium compact car market over the past several years - growth that is 'set to grow by 4-6 percent each year until 2020,' according to Reithofer. The industry veteran also stated that he felt that BMW was in a good position to enjoy an early lead in that area of the market due to a relative lack of current competitors.
Perhaps most surprising for diehard fans of the BMW brand is the additional revelation that the next entry-level vehicle to leave the factories could be based on front-wheel drive architecture. BMW has remained true to its rear-wheel drive roots since it first started selling cars in the United States, and its image as a manufacturer of exacting sports cars rests in great part on its dedication to this particular design. The use of front-wheel drive could potentially tarnish the image of BMW in the minds of current owners. However, given the sales success of small premium Audi and Acura automobiles that feature this particular drivetrain BMW may not have much to worry about in terms of its appeal to a broader base of new car buyers.
While heading in a front-wheel drive direction might seem like foreign territory for BMW, the realities of the current car market could leave the Teutonic brand with very little choice in the matter. BMW plans to expand its profit margins by as much as 10 percent over the next two years, and in order to do so it will need to start selling a wider range of cars. A more affordable, inexpensive to produce front-wheel drive compact car could go a long way towards helping BMW increase its share of the premium market. This becomes even more true if the company is able to share production and development costs with another automaker. BMW has already formed a partnership with PSA Peugeot CitroÃ«n to build small four-cylinder engines, and it has explored the potential of teaming up with Renault in order to split the costs on the development of a shared modular car platform.
With a projected production run of as many as 800,000 cars, it might soon become much cheaper to get behind the wheel of a new BMW. Whether that new compact car maintains the same spirit and passion that have made BMW such a success up to this point in the United States remains an open question.