Originally Posted by The Economist
Having never even considered a 3-series before, I think that BMW has done an excellent job with the F30. Some "purists" may lament certain evolutionary necessities, but BMW has done a great job keeping up with and adapting to the times by giving us a fine, grown-up sporting saloon within the constraints of the modern regulatory regime.
I do think, though, that Audi has done a better job with its product positioning.
First off, I like the idea of specializing in AWD - nice niche to carve out for yourself. You know that if you want the best in AWD (which I could care less about), you will need to at least consider Audi.
Second, and more importantly, is the S4. You know your volume mover is going to be the A4 2.0T - most people (keep in mind this is an enthusiast board, so your opinion does not count with the collective wisdom of the auto buying masses) do not care about the finer technical details. They care about superfluous niceties - bells, whistles, whatnot - but do not really care about the driving experience, so long as it gets there and is plush and comfortable. That is where the S4 comes in... Audi is smart enough to know that the person willing to shell out more for the engine is more of a nut, so why not offer something a little more special?
That is where BMW has lagged. You have the RS5 and M3, and you have the 328 to compete with the base A4. And the 335 does compete with the S4, but it certainly does not feel as special in the line up as the S4 does in the Audi line up. Perhaps that is what BMW was trying to accomplish with the M Sport line but is has fallen short.
Now, I considered both and ultimately I thought the 335 was the better car, but given that the volume model is the 328 (according to my dealer who sells one 335 for every ten 328s), you would think that BMW would market the 335 product in a similar way to the S4.
Then again, it does not really matter for this type of crowd who is more focused on the finer details. I just thought that it may make a difference from an overall marketing standpoint.
Well, the economist that I am has paid a lot of attention to the Audi-BMW rivalry. I agree with The Economist's view that Audi has been the better marketer than BMW.
The market for German premium cars has been very interesting recently; Mercedes has sort of been coasting along its reputation and has experienced the slowest growth in sales. BMW has been the market leader for a while now, both in the US, Germany and China I think. They have been cranking out great (popular) products so much so that the BMW brand value has recently been declared to be twice higher than Mercedes' brand value.
But the real novelty is Audi's performance. They have grown much faster than everybody else in the past decade or so, boosted especially by the sales of A3, then A4, then Q5 (and recently A6 and A8). In many comparison tests they have been declared close to or superior to their BMWs counterparts. This is very surprising --where was Audi a decade ago? At this pace Audi will surpass BMW in Europe very soon, if not already done. Audi has suffered from inferior brand recognition in the US so for every Audi sold, two BMWs are sold.
Audi's strategy has been the following, I think.
1. Use the Volkswagen bin parts extensively to enjoy the economies of scale.
2. Beat Mercedes at interior quality. Done.
3. Beat BMW at sportiness. Remains to be done, in my opinion. In Europe they have a product offering for everything that BMW or Mercedes cranks out, more or less. To fight BMW's Motorsport division they have taken the "sandwich approach": provide one model slightly below and one slightly above. Two models are better than one, especially to fight the all-powerful M division. In response BMW wanted to close the gap between a true M car and the regular models, and came up with the M-sport line that they extent ended to their whole line-up.
Now I am personally drawn to Audi because they are cheaper and have much better interior quality. They also have more of a "responsible family man" look to them, especially the A3 and A4. But I can't get over the fact that Audis are just volkswagens (thoroughly reengineered, but VW nonetheless). That, and the fact that their architecture is FWD (to save money) and because of that, they have to resort to AWD versions for their most powerful engines. Thus you end up with some kind of oxymoron: a sporty, powerful car that is AWD. But, Audi's Quattro name is legendary, it can be marketed as enhancing safety, so Audi can get away with that. So we have a good brand offering AWD at a good price, and everybody else has to follow or else they lose sales (hence the growth of 4matic and Xdrive --even Ferrari went AWD to compete with Lamborghini!). IMO Audis are less of a clean slate, less pure of a brand than BMW.
But as someone said above, BMW has done very well with itself in the past two decades or so... Buying Rolls Royce allowed it to surpass Mercedes in the ultra luxury segment and buying Mini and do what they've done with it was pure genius as to how to extend the brand downwards to greater sales volumes without diluting the brand too much. It seems BMW is on the right path for the future as well; the 3-series (volume seller) is doing pretty fine, the X line is doing very well, alternative fuel vehicles are here or soon to be here, platform and engine sharing at the bottom of the BMW/Mini lineup will provide scale economies and allow BMW to remain competitive vs the Audi/VW group.