BMW: FROM YUPPIE-MOBILE TO SMART CAR OF THE '90S

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It looked like the 1990s was going to be murder on BMW, a brand broadly identified as the quintessential yuppie vehicle of the 1980s.

After reaching a high-water mark of 96,759 units in 1986, sales plunged for five years, to 53,343 cars by 1991. New competition from Japan combined with a societal backlash to the "greed decade" to eat at BMW's base.

But the German importer began rebuilding its image on a firmer platform when it brought out a redesigned 325i sedan in mid-1991, and sales have followed. The automaker sold 78,010 cars in the U.S. last year, and through the first eight months of 1994 was up 11.1% from the 1993 pace.

"It was so easy to sell cars around 1986 that it was hard for luxury manufacturers to see the negative consequences of some of the things they were doing," says Jim McDowell, VP-marketing for BMW of North America. "When the yuppie phenomenon passed, BMW had to re-examine its heart and soul, because high status was no longer a reason for buying."

On the product side, BMW committed to renewing models on a more timely basis and to providing better value. The company also maintained its tradition of responsive performance, distinctive styling and leading-edge engineering.

While the 325i introduced in 1991 showed BMW was on the right track, the 740i that made its debut in 1993 demonstrated the company's progress. Despite improvements such as a V-8 engine, it was launched at about the same price, $54,000, as the six-cylinder 735i it replaced.

On the marketing front, gone are the lifestyle ads from the late 1980s that showed beautiful people with their BMWs. Current ads by Mullen Advertising, Wenham, Mass., challenge perceptions that BMW models are expensive to buy and maintain.

By concentrating on all-season traction systems, current advertising also refutes a perception that BMW models are difficult to drive in slippery conditions.

"We are demolishing the yuppie image," Mr. McDowell says. "There is a percentage of people who won't buy a BMW because of that association, but that number is declining every year."

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