BMW dealers are clamoring for more crossovers

BMW needs to better balance its crossover supply with cars to meet demand and stop pushing cars, says Damon Shelly, chairman of the BMW National Dealer Forum.

BMW light-truck sales were 33 percent of last year's U.S. sales and the percentage needs to be about 40 percent, said Shelly, owner of two California stores, Shelly BMW in Buena Park and Irvine BMW in Irvine.

Shelly said having more crossovers "will make a lot of difference because they are not trying to force the greater share of passenger cars and will more closely meet natural demand."

"Hopefully, with a better mix, we are going to see a more balanced inventory pressure and we will not be forcing too many passenger cars out and losing [crossover] sales," he said.

The change in the mix hasn't "shown up yet," but Shelly said he's optimistic more X models will be available later in the first quarter.

BMW is increasing the capacity of its Spartanburg, S.C., factory, which produced more than 400,000 units for the first time in 2015. Capacity will rise by another 50,000 when the project to add the new X7 crossover, due to arrive in 2018, is completed. 

With light-truck supply in better balance, Shelly, 57, predicts BMW will set a U.S. record this year. Last year BMW sold 346,023 vehicles. 

Last fall, BMW launched its new generation 7-series sedan -- a technology-filled model with the most luxurious interior the brand has ever launched -- in hopes of luring conquests and competing with the Mercedes-Benz S class. 

Shelly said the 7 is bringing in "predominantly retention buyers" and applauded BMW's recently added $3,000 dealer cash incentive. "It is a highly competitive market. The dealers are glad BMW is coming in and supporting all of its products rather than waiting." 

He agreed with BMW of North America's decision not to bring in the 2-series compact Active Tourer. "It isn't really a crossover. It is front-wheel drive and a very European-looking wagonish thing." 

Although the i3 electric is selling well in California where he owns two stores, Shelly said he'd like to see "a more mainstream model" as a new i family member.