BMW Australia boss puts brakes on ute bid

BMW Group Australia chief executive Vikram Pawah has echoed remarks made recently by the German prestige car manufacturer’s global R&D chief Klaus Froehlich that the world does not need a BMW pick-up truck.

Speaking to GoAuto at the launch of the BMW Z4 and 8 Series sportscars in Victoria earlier this month, Mr Pawah said there is nothing in the pipeline now or in the future for such a vehicle.

He also added that a competitor to the likes of the Mercedes-Benz X-Class and Volkswagen Amarok is not in line with BMW’s brand values, and questioned how a truck could fit into the company’s vehicle portfolio.

“We have no plans for it,” Mr Pawah said. “Currently, in our product portfolio, there is no pick-up truck, and we don’t intend to plan for that either.

“I don’t really see the need for it right now. We are pretty much focused on our luxury (vehicles), and I think the company has clearly defined that we are in the luxury business and that’s where we are going to be.”

At the Paris motor show last October, Mr Froelich said that the anticipated sales volume and potential profit in the premium ute segment was not large enough to warrant the investment at this time, since only a fraction of the big North American, Australian and South African truck markets would desire a premium-priced pick-up anyway.

“If you look at the segment of pick-up trucks in general, it is very much that utilities at medium price points are very, very low,” he said.

“To do a proper pick-up you need a ladder-frame architecture. If you do a monocoque body style, this is very much compromised. And this is the reason why Daimler uses the Nissan platform and puts a Daimler logo on it. We will never (do) badge engineering; it would be a BMW.

“So, the market is big (but) the premium side of that market is extremely small. It was never profitable. There were only a few regions of the world, Australia is one of them, South Africa and certain areas of the States where they have (Ford) F150s.”

As recently as last year, former BMW Australia chief executive Marc Werner, who is now in charge of Mini in the Asia-Pacific, South Africa, Russia and Importer Markets, spoke openly about his push for a sport-luxury one-tonne utility with management in Munich, revealing that it was impossible to ignore the size and scope of the segment in Australia.

However, he also emphasised that such a vehicle would be at least half a decade away from showroom floors.

“We’ve been very pushy regarding utes and pick-ups,” Mr Werner told Australian media in February last year. “We believe that this is something that the company should be looking to. We’ve raised that with (global headquarters), and there are certainly investigations as we speak.

“If you look at the market with more than 150,000 utes out of 1.1 million vehicles overall – and I think that segment grew last year (2017) by 17 per cent – we cannot close our eyes and neglect it. We cannot neglect market trends.”

Mr Werner also emphasised that such a truck would have to reflect BMW luxury and dynamic brand values to be a reality, however he believed that the capability within the organisation was more than able to deliver a ground-breaking pick-up.

With no support from Mr Pawah, it appears that BMW Australia will sit out the truck phenomenon for the first part of the 2020s, since there are other anti-pick-up truck factions within the organisation sharing his views.

Along with Mr Froehlich, BMW’s former head of Asia-Pacific region and now the sales and marketing operations chief for Asia-Pacific (excluding China), Eastern Europe (outside EU), the Middle East and Africa, Hendrik von Kuenheim, controversially referred to the Mercedes X-Class as “appalling”, stating that the Bavarian brand would never compromise.

“When you look now at our German competitor from Stuttgart, I think that the product is appalling,” he told Australian journalists, including GoAuto, at the 2017 Frankfurt motor show.

“You would have expected something more serious. This is, for me, and I listened to yesterday some of your (media) colleagues from other countries (saying), ‘Oh that’s very cheap, very plasticky, not very much Mercedes-like, what you would expect?’”