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BMW Revs Up SUV Sales

The 2012 BMW X5
Source: bmwusa.com
The 2012 BMW X5

In a year where gas prices have surged and the economy has stalled, BMW is quietly enjoying a strong year in SUV sales.

Who'd a thunk it right?

This year, BMW SUV sales are up 42% (overall sales up 11.4%) here in US which brings up the question: what's driving the demand for BMW SUV's?

There are actually a combination of factors.

  • First, while gas prices have gone up, they have not hit a point that has scared off high end SUV buyers.
  • Second, BMW has been pushing greater fuel efficiency. Jim O'Donnell, President of BMW North America says, "We're offering diesel in an SUV. We're responding to the needs of the market place in terms of addressing the the fuel efficiency issue, and the consumers want the space. They want the size, the space, the flexibility of the SUV."
  • Third, when Lexus found itself with a tighter supply of vehicles after the earthquake, luxury SUV buyers looked around. How many migrated over to BMW is hard to say, but it probably had an impact.

Incredibly, BMW could probably sell even more X3 or X5 SUV's but it's running at close-to-capacity. In fact, O'Donnell says that even if the company could squeeze a few more SUV's out of its Spartanburg, South Carolina plant, it probably wouldn't. O'Donnell wants to make sure BMW matches production to sales.

Even though SUV sales are soaring for BMW, the company is not going to forget about developing smaller, more fuel efficient cars. It just unveiled its i series of electric cars. Those will be on sales here in the U.S. in 2014.

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