your suggestion and comment are welcome. If you want this PPT , write to me at 11jgbs-sgunjan@jgu.edu.in

1. Case Name:
BMW North of America
Dream it, Built it, Drive it

2. History of BMW
A fter World War I, BMW was forced to cease aircraft (engine)
production by the terms of the Versailles Armistice Treaty. The company
consequently shifted to motorcycle production in 1923 once the restrictions
of the treaty started to be lifted, followed by automobiles in 1928-29.
T he circular blue and white BMW logo or roundel is portrayed by BMW
as the movement of an aircraft propeller, to signify the white blades cutting
through the blue sky.

3. THE US AUTOMOBILE INDUSTRY
The Automotive industry is largest manufacturing
sector in united states averaging about 3.6% of the
total GDP.
IN 2011 the U.S automotive industry was estimated
about $500 billion.
American auto sales has dropped by 37% during the
global crisis.
only 10.4 million new cars and trucks were
purchased in 2009.
The number has increased to 12.7 million units in
2011 and 13.8million units in 2012.

4. U.S. Car Distribution
US was a home to 17000 new passenger cars and
truck dealers with approximately 37000 franchises in
2011.
Auto dealers operated on relatively low gross profit
margins in 7 to 15% range for new vehicles.
In 2011 more than 70% of purchase originated from
online research due to its ease.

5. BMW OF NORTH AMERICA
BMW established its US office in wood cliff lake ,new
jersey, in 1975.
North America is the biggest market for BMW.
In2011 three hundred and five thousand BMW’s, Rolls-
Royce, and MINI’s rolled to new owners in United States.
BMW X3 was the most popular model of the year in the
luxury compact SUV segment selling 27,793 units.

6. BMW Dealerships
The company has two types of sales centers “BMW
Passenger Car Center” and “BMW Sports Activity
Vehicle centers (SAV)”.
In 2011 the BMW altogether has 338 passenger car
and SUV centers,138 motorcycle retailers,104
MINI, AND 30 Rolls Royce motor dealers.
Partnership between the dealers and BMW were
based on financial incentives, marketing supports and
corporate training.

7. Target Customers of BMW X3
The people who are new to the luxury
market
People in their 20s,30s or 40s who are
stepping out of domestic and non-premium
SUVs.
Young families who need SUV with space
but not large size.
People who have money and can afford
luxury cars.

8. Competitors

9. Customization at BMW
1992- Launched its first mass customisation business named Individual Program
2000- “Customer oriented sales and production process”(KOVP) was launched which
enable on-schedule deliveries and afforded a high degree of flexibility in making
vehicle equipment changes until very late in the production process.
It focused on transparency of the production chain in which BMW used vehicle
identification and location system that made it possible to automatically identify,
collect and document vehicle movement during and after the assembly process.
Every vehicle transmitted signal in 4 minutes which is received by in-house
antennas. Customisation was available in all models in Europe but in North
America it is available in 6 & 7 series
The most common BMW individual trimming options included expensive leather
and wood for the interior, advance sound and video systems, aero dynamic
exterior enhancements and unique body colours.
The model which sold for $60000 in North America, sold for euro 60000 in
Europe.

10. The BMW F25(X3)
Introduces in 2011
compact crossover
5 door wagon body style
First introduces in 2003 named X3
It is available in the U.S with a 3.0 liter inline six-cylinder gasoline
engine, either normally aspirated or with a twin scroll turbocharger
only.
The premium xDrive28i($37,100 MSRP, 25 mpg) had 240
horsepower where as xDrive35i($42,700 MSRP, 26mpg) used a 300
horsepower turbocharged engine.
8 speed automatic transmission
Its rear suspension system came from the E46 330xi all-wheel drive
model.

11. Dream it. Build It. Drive it.
This program encourages to customize their vehicle.
The concept of BMW’s new campaign included the engagement of customers at
all three stages of sales process: from initial surfing on the internet, where
consumers “dream” about the car; to the second stage, which involved
individual customizing or “building” and finally the last stage, which culminated
in delivery and finally “driving it”.
BMW extend the concept of online customisation to address the issue of
impatience in American car buyers by making the wait a more pleasurable
experience.
It decided to install video cameras along the assembly line and broadcast the
process of a how a X3 comes to life.
By being able to access a website called “Your X3 on the assembly Line” buyers
could trace seven major assembly stages of their new vehicle at the factory at
South Carolina.
BMW offer 500 side mirror combinations,1300 front bumpers, 5000 seat
combination or 9000 centre consoles which comes from 170 suppliers.

12. ANTENNA
TRANSMITTER

13. Dream it. Build It. Drive it.
BMW moved the complete production of the redesigned X3 from Europe
in order to reduce the delivery time for the U.S. As a result the delivery
time for new X3 in the U.S dropped from seven to 2-3 weeks and in Europe
5 weeks

14. BMW group sales

15. BMW group revenue

16. Problem
Declining interests in cars among young people, who were
becoming increasingly more environmentally conscious and
unresponsive to the traditional advertising.
In Europe delivery of F25 got delayed.
Misconception between dealers and company itself regarding
the delivery time of vehicle. Dealers think BMW has
overestimated the impatience of its customers.

17. CHALLENGES
To sustain the current online marketing.
Maintaining the suppliers.
Maintaining the flexibility in production line.
As the customers of US are becoming
Environment friendly so they have to go in a
way so that they can attract those customers.

18. Reasons for success of X3
Marketing
IN 2011 X3 came back to Hollywood in the latest
block buster Mission Impossible 4-ghost protocol.
Customization.
Introduction of video camera in assembly line so
that customers can watch it and share it.
accurate positioning.
i-AD

19. Reasons for success of X3
OPERATIONS AND SUPPLY CHAIN
Introduction of antenna and transmitter.
Successful management of suppliers in US
and other countries for assembly of X3.
Reduction of delivery time from 8-9 weeks
to 2-3 weeks keeping the U.S. customers in
mind through relocation of assembly line to
South Carolina.

20. The Indian Auto Industry
The automotive industry in India is one of the largest in the world
and one of the fastest growing globally.
India's passenger car and commercial vehicle manufacturing
industry is the sixth largest in the world, with an annual production of
more than 3.9 million units in 2011.
In 2010, India beat Thailand to become Asia's third largest exporter
of passenger cars.
As of 2010, India is home to 40 million passenger vehicles. More
than 3.7 million automotive vehicles were produced in India in 2010
(an increase of 33.9%), making the country the second (after China)
fastest growing automobile market in the world.

21. Indian Luxury car Market
Mercedes Benz ruled the Indian luxury car market for
more than a decade.
The things started to change after 2006 when AUDI and
BMW invaded the Indian market.
Within 2 years of its entry BMW became the market
leader.
Total of 3500 luxury cars were sold in 2006.
This grew 7 folds by 2011 to around 22000 units.

22. BMW In India
BMW started its operations in India in 2006.
The company headquarters are located in
Gurgaon(Haryana).
Company has a state of art manufacturing facility in
Chennai which has a capacity of producing 11000 cars
per year.
The 3,5 and 7 series cars along with X1 and X3 SAVs are
manufactured in Chennai plant.
All other cars in BMW stable are imparted as CBUs.
BMW currently has dealerships at 22 locations in India.

23. BMW X3 in India
The new BMW X3 was launched in August 2011.
The SAV was launched in only 2 variants in India The
BMW X3 xdrive20d and xdrive30d.
The difference in 2 models was only the engine option.
20d came with 4 cylinder diesel engine and 30d came
out with 6 cylinder diesel engine.
20d retails at Rs 41 lakh and 30d retails at 47 lakh.

24. The Competitors
Audi Q5, it is the best selling car in this segment, comes
in 3 engine options 2 diesel and 1 petrol.
The price range is between 38.5 lakh for base 2.0L
diesel and 48.7 lakh for top of the line 3.2TFSI petrol
version.
Land Rover Evoque, it’s the latest entrant to the
segment. Price ranges from 41.6 Lakh to 61.3 Lakh.

25. The Indian and American X3
The car on sale in India is same as that in USA.
In India there are no petrol options and in USA there are no
diesel options.
Huge customization option available in USA but only 3-4
customization options in India.
X3 retails at 37000$ in USA which is very less as compared to
Indian variant.
http://www.bmw.in/in/en/newvehicles/x/x3/2010/showroom/i
ndex.html
This is the Indian site for X3.
http://www.bmwusa.com/standard/content/vehicles/2013/x3/d
efault.aspx

26. ADS for X3
• http://www.youtube.com/watch?v=tTEHmMA
tXAA
• This was the launch add for BMW X3.
• http://www.youtube.com/watch?v=iE2ShxxgD
O0
• http://www.youtube.com/watch?v=ZNFwsPN
aBOo&feature=related
• http://www.youtube.com/watch?v=W_QpPrC
Bz9c
• http://www.youtube.com/watch?v=UZLmJj8N
DQI&feature=related

27. Controversial ADS by BMW

28. Dream it build it drive it
Can this campaign be used for new x4 launch
plan for 2014?
Yes
Few points to be kept in mind
With customer built option for BMW X4
lack of supply has to be checked for customer
demand at the dealerships.
Trying to reduce the inventory cost as far as
possible.

29. Was the personalization aspect
over-rated?
Yes to certain extent

30. Scope of dream it built it drive it campaign in
India!
This concept can be a great success in India
provided BMW finds a way to cut down the
cost.
Increase in popularity of BMW in India.
Increase in purchasing power of high end
population in India.

31. Thank You!!!