IHS Global Insight Perspective | |
Significance | BMW has just retained its position as the world's top-selling premium passenger car brand after a close fight with Audi, with BMW brand sales coming to 265,809 units while Audi sold 264,100 units during the three- month period. |
Implications | Both BMW and Daimler's Mercedes-Benz brand are facing an increasing challenge from Audi. The latter outsold Mercedes-Benz globally for the first time in a quarterly sales period for the first time between January and March and appears on track to achieve its goal of becoming the world's top premium carmaker by 2015. |
Outlook | Audi experienced a far higher growth rate—25.9%—than its rivals in January to March and the company is on target to achieve its goal of overtaking both BMW and Mercedes Benz as the world's biggest premium carmaker by 2015. Audi's trump card in achieving its goal is its market-leading position in China. |
BMW just managed to retain its position as the world's biggest selling volume premium passenger carmaker in the first quarter of 2010 after seeing off the growing challenge of the Volkswagen (VW) Group's main premium brand Audi. In terms of brand sales, BMW's unit sales increased by 13.8% year-on-year (y/y) to 265,809 units in comparison to the 264,100 units recorded by Audi during the period, which equated to a growth level of 25.9% y/y for the first three months of the calendar year. As well as almost surpassing BMW during the first quarter of the year, Audi also achieved the milestone of beating its other chief rival Mercedes-Benz over a quarterly sales period for the first time. Like the other two brands, Mercedes-Benz's sales achieved 15% growth during the period from the low base of the first quarter of 2009, but fell behind both its rivals with combined sales of 248,500 units.
These sales volumes are based purely on BMW, Audi and Mercedes-Benz brand sales. BMW's position as the overall biggest selling premium vehicle group remains relatively assured in the short to medium term as a result of the popular Mini brand. Overall BMW Group sales rose by 13.8% y/y to 315,614 units, with this figure including Mini and Rolls Royce brand sales. Ian Robertson, the BMW Group's board member for sales and marketing, said: "We are back on our growth track in nearly all the automobile markets. We had a good first quarter with a sales increase of 13.8%. We intend to continue improving on last year's figures throughout the second quarter – thanks not least to the new BMW 5 Series Sedan and new models such as the 3 Series Coupé and Convertible." Robertson added: "For 2010 as a whole, we are aiming for healthy growth in the single-digit percent range to reach more than 1.3 million vehicles." Robertson's comments also reflect the positive sales results experienced by Mercedes-Benz and Audi during the first quarter of the year. Both BMW and Audi will benefit throughout the rest of the year from the launch of key new models. As Robertson highlights, BMW's new F10 5-Series will provide strong sales impetus in Western Europe and the United States, and BMW's March's sales in particular will have seen a marginal uplift as a result of the model. However, Audi's major new model, the premium B-segment A1, has yet to go on sale and will be rolled out across Europe from May. Arguably Audi's sales will be more directly comparable with BMW's Group sales as the A1 is aimed squarely at the Mini model. Mercedes-Benz is the brand which will arguably suffer this year through a lack of key new model launches. The company's best-selling model, the D2-segment C-Class is due for a face-lift and the well received E-segment E-Class, which was launched last year, will face stiff competition from the 5-Series.
Outlook and Implications
Audi appears to be closing in on achieving its goal of becoming the world's biggest premium passenger carmaker by 2015, going by this latest quarterly sales result. The pace of the brand's sales volume growth in the first quarter of 2010 outstripped its two principal rivals and the company has a major advantage in its market-leading position in China, which is largely down to the early entry of its parent, the VW Group, into China in the mid-1980s. As a result Audi has been able to tap into the VW Group's marketing, distribution and dealership network in China. During the first quarter of the year Audi's sales increased by 77.3% y/y in China, with the company's entire sales volume in the Asia-Pacific region totalling 64,450 units, the vast majority of which were generated in China. BMW enjoyed even higher growth in China, albeit from a much lower base, of 106.1% y/y to 34,179 units. However, the company's production joint venture (JV) with Brilliance is yet to offer the scale and market reach that Audi has in China. Audi is also looking to increase its market presence in the United States, where it has been traditionally weak in comparison to its two main rivals, not helped by negative publicity surrounding alleged incidents of unintended acceleration that blighted the Audi 5000 in the 1980s. The company may even build models at the new VW plant in Chattanooga, Tennessee, which is due to go online in 2011, with Audi's management due to make a decision by the end of the year. Given the increased emphasis on the United States and its market-leading position in China, Audi's goal of becoming the world's biggest premium carmaker within the next five years looks very achievable.