BMW braces for three digit market in Sri Lanka

Monday, 22 November 2010 00:01 -     - {{hitsCtrl.values.hits}}

Given the strong post war upturn in Sri Lanka, BMW, the world’s leading premium automobile manufacturer, is bracing for a three digit market.

“We have already seen an encouraging uptake since the end of the war as well as recent reduction in import tariffs. In tandem with higher socio-economic growth and Sri Lankans aspiring for world class products, we are confident of the market having the potential to expand to three digits from the current single level,” BMW Group Sales and Marketing Vice President Importer Markets Graeme Grieve and BMW Asia Managing Director Johannes Seibert told the Daily FT recently in Singapore.

Speaking on the sidelines of BMW World in Singapore, the motor brand’s largest showcase of innovation, design and heritage, the duo said that Sri Lanka was an important emerging market in Asia, which overall has been driving strong sales growth.

BMW together with its Sri Lankan sole agents Prestige Automobile Chairman H. Reuter and Managing Director Gehan Siribaddana last week firmed up the 2011 Sri Lanka action plan, which will aim at leveraging the post-war upturn best for the brand.

They said that customer feedback in Sri Lanka for BMW range has been excellent. Surveys have found BMW as the most valuable brand automobile brand whilst in the luxury sphere it is young and dynamic.

Grieve and Seibert said that agents play a critical role for the success of BMW, which operates 24 production facilities in 13 countries and has a global sales network in over 140 countries. BMW remains the world’s best-selling premium automobile brand both for August and the year to the end of August, and was able to expand its lead over the relevant competitors

“Sri Lanka has remained a longstanding market and Prestige Automobile does multiple functions such as importing, distribution, retail and service hence we will continue to extend our strong support,” they added.

The optimism on Sri Lanka comes at a time when larger Asia has remained dynamic. Asia contributes to 15% of global sales for BMW Group which includes BMW, MINI and Rolls-Royce brands. Grieve said Asia, remaining resilient despite the global recession, has helped the Group.  Five years ago Asia only accounted for 9.5% of BMW Group sales.

Not only in Asia but globally BMW has remain dynamic. Whilst year to date BMW sales have grown by 30%, in August BWM reported better than expected sales worldwide whilst Asia remains the bright spot.

BMW brand not only sold 16.3% more automobiles year-on-year – for the first time, it also delivered more vehicles than in August 2007 (+3.6%) and 2008 (+3.1%). Asia and China in particular was the most powerful force driving its sales growth once again in August.  The Group has sold over 106,000 BMW and MINI vehicles so far this year in China, which is more than in the whole of 2009.

“We are growing in all markets,” Grieve and Seibert noted, adding that consumers were fast becoming more aware of the sheer driving pleasure of BMW powered by the excellence in engineering, design, and quality in addition to the cutting edge ‘efficient dynamics’ of BMW.

The holding of BMW World in Singapore, the first of its kind outside BMW’s birthplace – Munich, is also a fitting tribute to Asia as well as reflects the importance and significance. The event also coincided with the silver jubilee of BMW in Asia. Whilst Europe and North American provides the lion share of BMW sales, the two company officials acknowledged that China and India, the growth drivers of dynamic Asia, are the most exciting markets.

The BMW World Singapore heralded the Asian premiere of the all new BMW X3, as well the much-awaited debut of BMW M3 GTS. It also offered a glimpse into the future with BMW concept cars and a preview of the 2011 BMW Lifestyle Collection. The show was part of what Grieve and Seibert described as “significant investment” BMW is making to grow in the Asian market.

As per August data, sales of BMW brand vehicles rose sharply by 16.3% to 88,007 units (prev. yr. 75,699). A total of 775,262 vehicles were delivered to customers in the year to the end of August (prev. yr. 679,913 / +14.0%).

BMW maintains its high-value model mix, with retail gains for the large model series in particular in August: Sales of the BMW 7 Series, for instance, increased 52.8% to 6,051 (prev. yr. 3,961) units in the month under review.

The BMW 5 Series also reported sales growth of 24.9% (16,175 / prev. yr. 12,948). It was envisaged that the market launch of the new BMW 5 Series Touring would give the 5 Series another major boost from September onwards; orders for the new model are already well above plan.

The X models also reported higher volumes: Sales of the BMW X5/X6 models climbed 36.4% to 12,707 units (prev. yr. 9,316). Although the successor model is just around the corner, X3 sales increased 10.3% to 3,936 units (prev. yr. 3,570).

The BMW Group achieved a global sales volume of approximately 1.29 million automobiles and over 87,000 motorcycles for the 2009 financial year. Revenues for 2009 totalled euro 50.68 billion. At 31 December 2009, the company employed a global workforce of approximately 96,000 associates.