Sluggish sales for Mini — BMW's bold 16-year-old venture to entice Americans into stylish British small cars — have become a crisis.
To overcome Mini's meager product pipeline and stem dealer losses, BMW of North America confirms it is considering letting Mini dealers move operations into their BMW stores.
That could help Mini dealers defray operating costs and real estate overhead by sharing backroom expenses. But not every Mini dealer is a BMW dealer.
A decision has not been made, but the change would end Mini's insistence on a separate high-profile identity.
It might also be a milestone in the struggling brand's saga. The marque, which expected annual sales of 100,000 cars by 2017, peaked at about 66,500 in 2013. Through the first 10 months of this year, sales totaled just 37,359. That is hardly enough to support the investments of retailers who opened 127 free-standing Mini stores since 2008 at the factory's request.
"As a dealer and a manufacturer you have a vision of where the brand is going, and you have to prepare for it," Jason Willis, a member of the Mini National Dealer Council, told Automotive News. "In this case, the vision now isn't what it was when some of these stores were built."
A standalone dealership model for a small-car brand today is financially untenable, said Rebecca Lindland, executive analyst with Kelley Blue Book.
"There's very little on the horizon to suggest the return of the small car," Lindland said. "I would hate to see the dealership model be the death of Mini."
Mini's struggle takes place as U.S. consumers shun cars for light trucks. The brand's U.S. sales in 2017 tumbled nearly 10 percent. The last year Mini had a U.S. sales increase was 2015, when deliveries rose 4.3 percent.
"You've got a small product line — all small cars — in a strong SUV market," said Willis, general manager of fixed operations at Willis Auto Campus in Des Moines, Iowa. "Our product doesn't match the demand."