BMW tackles dealer 'issues'

BMW Australia is working to resolve issues with its Australian dealer network as it fights to stave off Audi and reel in Mercedes-Benz to reclaim leadership of the local luxury car market.

And it is also encouraging American billionaire car dealer Roger Penske to buy into its Australian network.

The Munich brand had been the leading player in Australia’s luxury car market for most of the early 2000s, but has given up that mantle to Mercedes-Benz for the last two years.

Meanwhile, in 2015, ever-ambitious Audi has closed to within 212 sales of BMW after four months of 2015, according to VFACTS figures, and actually outsold its rival in the month of May.

The battle between the three German heavyweights has long been an intriguing sub-plot of the Australian new car sales market and is a microcosmic representation of their global battle.

During a visit to Australia last week BMW Group senior vice president Asia, Pacific and South Africa Hendrik von Kuenheim told motoring.com.au that “issues” with the dealer network had been a problem in recent years and that was one reason he had earmarked one of his staff, Marc Werner, to become managing director of the local sales office last year after Englishman Phil Houghton returned home.

And von Kuenheim made it clear he expected Werner to boost BMW sales and push the brand back toward the number one position.

“I believe here in Asia, Oceania and here down under we still have potential to grow,” he said.

“Not everything in the past was great. We need to straighten out a few issues in the dealer organisation and I think Marc was just the right character to do this.

“Sometimes you just need to listen and sometimes you need to talk and the feedback I have got from the dealers so far has been outstanding I must say. So we are the right way.

“But he (Werner) can always sell more cars. I am never 100 per cent satisfied. It is BMW culture to always go for more.

“Here in Australia we would like to be number one and that is one of the reasons why Marc is here,” von Kuenheim added.

“I have all the confidence in the wold that we will turn out eventually to be number one.

“That is not really important today or tomorrow, but you must have your strategy and focus and not leave the path of your strategy.”

While reluctant to delve into details and quick to reject the term “overhaul”, von Kuenheim made it clear that some members of the current 45-strong network were not performing up to par and should either put succession plans in place or sell their businesses.

He couched those comments in the context of a rapid-fire roll-out of a new generation of product that will include the new generation 1 Series, overhauled 3 Series and an all-new 7 Series over the next 12 months or so.

“The product alone will not do the job if your brand positon in the market and your sales organisation cannot keep up with the product the head office delivers,” he said. “I do believe that is the reason why Marc Werner was sent down here; we had to refocus on our retail network.

“We have outstanding dealers but some of them also need some improvement.”

Von Kuenheim said he would welcome the arrival of the Penske Auto Group into the Australian market alongside other overseas players already investing here.

Penske is already involved in the transport and trucking industry in Australia and has extensive luxury car dealership networks covering a variety of brands in Europe and North America.

Von Kuenheim knows Penske well from his time working in North America and talks with him regularly. He met on his last visit to Australia with a Penske representative and has also admitted discussing potential link-up to race V8 Supercars.

“I consider Roger Penske one of the great car dealers in the world,” said von Kuenheim. “He has three or four dozen BMW dealerships throughout the world from Spain to Germany to England to France to America to Canada and so on.

“He has established his truck business in Australia and I would not be surprised if he sooner or later enters the car business here as well in the luxury segment.

“Those international dealer groups raise the bar; how they do business with the customers, how they do follow up.”