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BMW to keep Mini supply flat despite increased demand

07/09/2008, 11:11 AM

By Drew Johnson

With gasoline prices now at record highs around the country, there has been a sharp spike in demand for fuel efficient vehicles. Most automakers are scrambling to increase production of their thriftiest models, but BMW is taking another route with its Mini brand.

Mini sales are way up this year – with most dealers only having a 5-day supply – but BMW has no current plans to increase the U.S.’ allotment of Mini vehicles.

The supply problem stems from Mini’s lone production facility in Oxford, England. The Oxford plant is currently running at full capacity and BMW is not ready to commit to a costly expansion. However, that isn’t stopping Mini from lobbying its parent company to boost capacity. “Increased capacity equals cost,” Tom Kowaleski, BMW’s North American vice president of corporate communications, told Automotive News. “It comes down to the accuracy of forecasting.”

Mini sold 26,400 vehicles through the first six months of 2008, an increase of 33.6 percent.

Kowaleski also said that Mini pricing would probably see an increase for 2009 — due to rising raw material costs — but no specific numbers have been set.

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07/09, 11:14 AM

posted by:

Stinky007

Incredibly, there’s more demand for expensive small cars than for reasonably priced ones…
Go figure!

07/09, 11:16 AM

posted by:

Madcapp

Wow, imagine that, reasonable fuel efficient cars sell…and Hummers, Escalades, and G-wagens are still junk for foolish people.

07/09, 11:37 AM

posted by:

Carwatcher

BMW is the smartest and most profitable automaker in the world. They refuse to sellout to the high volume gods.

07/09, 11:39 AM

posted by:

Chris C.

What I don’t understand is why people are so fooled by this little car. It may get better mileage however it does not have a huge fuel savings. The car has a 12 gallon tank and requires premium fuel. I drive a larger American sedan that has a 19 gallon tank and uses regular fuel.. When you look at the cost for premium, verses the cost for regular and further take into account distance on a tank btwn the two cars… its damn near the same cost. I’ll take comfort any day!

07/09, 11:44 AM

posted by:

jonmiles

^In my experience, people who don’t really have to worry about the price of gas affecting thier weekly tennis lessons still “care” about it. These customers are getting out of landrovers and escallades, and in comparison- the mini gets GREAT mileage.

07/09, 11:55 AM

posted by:

golf4me

Chris C., if you do the math, it IS still less expensive to run a Mini vs. a “large american sedan” — all things being equal. However, say your car is paid off and you’d have to go out and spend 25k to get a decent Mini, then the equation changes considerably. This is the part that most short-sighted Americans don’t consider. They spend $400/mo to save $200/mo on gas…I did a spreadsheet for a math-challenged friend of mine who wanted to trade his now-worthless, but almost paid for Silverado on a Civic…basically it would have cost him $7000 MORE over 5 years. Sure, saved a lot of money on gas, but the cost of the car and then the interest expense on top of that killed the fuel savings. Hey, if anyone wants to spend MORE to save gas for the rest of us, that’s commendable, but I’d rather you just send me the check…

07/09, 12:07 PM

posted by:

JoshyLofty

My Dodge requires Premium gas & i was complaining about it @ first but i sat down & did the math, premium is an avg of 15 cents more than regular here and i drive approx. 10K miles a year (i’ve had my car new and it only has 37K miles on it, its a 2006 model.) so i’m only spending like 150 extra a year by using premium. not too bad.

i still don’t wanna pay frickin 4 bucks a gallon tho for any kind of gas.

07/09, 12:21 PM

posted by:

ktulu

smart -he jeh

07/09, 12:26 PM

posted by:

donaldj

Hey Chris C, the MINI does not take premium, the MINI-S does. And the Mini has something that your large american sedan doesn’t. Elegance. If you haven’t driven one for a while, you just don’t know. But I suspect not knowing won’t keep you from posting, eh?

07/09, 12:27 PM

posted by:

global_lightning

Golf4me:
Did you include maintenance in your calculations? Not that it will make up the $7000 difference, but an older car will need more maintenance out of pocket, while a new car comes with a warranty.

07/09, 12:32 PM

posted by:

golf4me

Maintenance, no as Honda does not pay for that. I allowed $500 per year for repairs on the truck for 3 yrs, which is when the Honda is out of warranty. The truck is an ‘05, and he takes good care of it, doesn’t haul anything, etc. Obviously, it’s only an estimate, and it would be all f-ed if he had to put a tranny in it or something.

07/09, 12:38 PM

posted by:

F451

When BMW first reinvented the Mini its styling was on its mark, but now I can see where they would want to curb production as the newer models are just plain ugly.

07/09, 12:48 PM

posted by:

howsmydriving

Building a car as small as Mini and selling it for premium prices has been quite a marketing coup.

07/09, 1:13 PM

posted by:

RaineMan

“It all comes down to forecasting.” Which is apparently something that no automobile manufacturer is good at. You can’t tell me that when gas first hit $3/gal here in the states there wasn’t someone out there who thought it would just keep climbing.
But that’s okay… we’ll all just wait on Fiat and Alfa to bring their small cars over here… then Mini will wish it had sold more Coopers when it had the chance.

07/09, 2:23 PM

posted by:

xyunya

RaineMan, per article yesterday when Alfa will come to US, BMW will collect on sale of those cars as well. That may be the reason why they not rushing into increasing plant capacity at a tremendous cost to them. Can’t blame them for being shrewd. Yes, domestics would spend billions to raise capacity just to find that ther eis not demand after moneys are spent.

F451, you must have eagle eye: I cant distinguish between last generation Mini and latest (’07) model unless they stand very close to each other and you can determine that the new one is ugly and old one was OK. Congrats, I am jealous.

donaldj, even non-turbo Mini requires premium gas; their commercial in my neck of the woods states “runs on irregular”. Nevertheless, difference between premium and regular is about 5% (in my neck of the woods) and Mini is one of the most frugal cars on the road.

What is more interesting, that it is the most exciting car to pilot. I think Car & Driver wrote that you get 90% of Ferrari excitement for 10% of price. I tried: true enough.

07/09, 2:28 PM

posted by:

mayer_ray_nagin

Minis are just Poseur Cars For The Masses …. the masses of idiots with inferiority complexes who blew previously their wads on larger poseur cars but can no longer afford them because they were too stupid to save and invest.
.
Also, it’s true – if your big car is paid for its cheaper to continue driving it than to buy a Civic. You’ll lose more in depreciation, interest, and opportunity cost of capital on the Civic than you’ll save in gas. When I did the math it was more like $10k over 5 years but I wanted a better car than a Civic.

07/09, 2:56 PM

posted by:

xyunya

Cars are fashion statements which spell more about us then we would like to admit. That makes everyone behind a wheel a poseur.
Perhaps 20-24K car is less of poseur statement then 40K car with less driving fun.

07/09, 3:27 PM

posted by:

A4

so he has a truck and doesnt haul anything, thats brilliance in itself

07/10, 7:26 AM

posted by:

JohnnyBlazE

Who’d have thought cars manufactured in England would be in DEMAND?! Thought our auto industry was as good as dead :p

07/10, 1:56 PM

posted by:

ISMINGELS

Its ok JohnnyBlazE soon we will see a rise in British cars in the junk yard after all but a few diehard enthusiasts get tired of fixing them.

07/10, 2:12 PM

posted by:

Impulsive

How about they address that start-up noise. And the black wheel well trim unclipping. For a $30k car, that is unacceptable.

 
 
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