DETROIT-- BMW of North America sold only 784 cars under the federal cash-for-clunkers program, but its top executive says the program helped the company.
We have seen the showroom traffic improve substantially, said Jim ODonnell, CEO of BMW of North America, in an interview today. Whether we approved of the program or not, it has gotten back into Americans minds that its OK to buy a car.
Because many of its vehicles didnt meet the clunkers criteria, BMW offered its own incentive. BMW paid a spiff of $4,500 cash, which it calls an eco-credit, on its two diesels, the 335d and the X5 xDrive35d.
ODonnell said BMW is extending the incentive: You may think were mad, but were continuing with the eco-boost in September.
With the clunkers-related traffic, the BMW brand said it sold 19,232 vehicles in August, a decline of 24.5 percent from August 2008.
BMW as a whole expects to sell more than 200,000 units this year, he said.
Total U.S. sales for BMW, including Mini, fell 21.3 percent in August to 24,343 vehicles, the company said. Through the first eight months of the year, it said, BMW sales fell 26.5 percent to 160,044 vehicles.
BMW of North America will be profitable this year, ODonnell predicted, as will the vast majority of its dealers. About 10 percent of dealers are losing money, with dealer margins overall averaging about 2.75 percent.
ODonnell said BMW is using certified used vehicles to draw younger consumers to the brand during the recession. Long term, he said, we see ourselves gaining share in the U.S.
ODonnell said the eco-boost incentive has helped BMW experiment with pricing for diesels in the United States. He said the companys new cleaner diesels, which can be sold in all 50 states, will be a key element in meeting more stringent federal fuel economy standards. The company will look at creating diesel versions of other models, ODonnell said.
As it seeks to raise corporate average fuel economy, BMW North America is also likely to push for more sales from its Mini brand, consider turbocharged four-cylinder gasoline engines and use more lightweight materials in its vehicles.
But, ODonnell said, BMW wont abandon V-8 engines here: I think that in America, the customer wants a V-8. I think theres this innate desire to have a V-8.