BMW's first diesel limousine

BMW has released its first diesel limousine in Australia, which has the power of a V8 and better economy than a Holden Astra.

The BMW 730d, which sips just 7.2L/100km and has fewer tailpipe emissions than the hybrid Lexus LS600, is the exclamation point for BMW's push into the diesel market.

The German maker revealed that one in three of all new BMWs sold so far this year was an oil-burner -- and it has also outsold its main rivals in the diesel class.

Five years ago, BMW didn't even sell a diesel car, but today there are only a handful of models that aren't available with diesel power (1 Series coupe and convertible, 3 Series Coupe and convertible, and the sporty 6 Series and Z4). Significantly, however, BMW says it is considering adding diesel engines to some of these models, having been buoyed by the sales success of rivals such as the Volkswagen Eos diesel convertible.

For now, though, the 730d is the pride of BMW's diesel fleet and marks the arrival of an all-new engine which delivers four-cylinder economy in an almost two-tonne car.

Although the 730d is powered by a 3.0-litre turbocharged inline six-cylinder diesel engine, it is completely different from the diesel engine of the same capacity fitted to the X5 and other models, and is Euro V compliant.

At $198,800 the 730d is now the cheapest ticket into a 7 Series, undercutting its petrol-powered sibling, the 740i, by $4200.

The 730d comes "tantalisingly close" to the Federal Government's tax concession for "green" cars that sip less than 7L/100km. But BMW says an update of this engine next year could bring the 730d under that threshold, and so it has passed-on the saving earlier.

"The price won't change [when the sub 7L engine comes out] because we've already taken into account the tax benefit," says BMW Australia spokesman Toni Andreevski. "We're contributing that cost right now."

The decision to release a diesel version of the 7 Series was a bold step for BMW Australia, but the company says the time was right.

"The idea of a diesel in a luxury car is not as foreign as it once was," says Andreevski. "In recent years we've had a strong swing to diesel sales and we felt the time was right to finally bring in the diesel 7 Series to Australia."

In Europe the 730d is the most popular 7 Series model. So far this year BMW has sold 2043 diesel cars, Audi has sold 1611 and Mercedes-Benz has sold 1552, according to figures supplied by BMW.

The 730d will only be available in the short wheelbase body style for now. BMW denied this was designed to discourage hire car drivers from buying the vehicle.

BMW revealed this week that it "got out of the hire business two years ago", because the hefty discounts hurt the resale values of 7 Series too much. The hire cars were bought at significantly reduced prices, enabling them to be sold cheaper on the used market. This sharply drove down the value of the cars bought by private customers, who paid more for the vehicles when new.

"We're trying to reduce the complexity of our line-up," Andreevski said.

He said it was the same reason Australia would not get the more powerful turbo diesel version of the 7 Series.

As BMW was revealing the 730d to Australian journalists this week, BMW in Munich unveiled a 740d powered by twin-turbo version of the same diesel engine -- which sips just 6.9L/100km.

"We have 56 models in our line-up and we're trying to make the choice simpler for our dealers and our customers," says Andreevski.

BMW also took a polite swipe at the optional equipment offered by other luxury brands. BMW and Mercedes-Benz regularly receive criticism from the media for having an expensive options list.

But last year Mercedes-Benz overhauled its catalogue and bundled a lot of popular options to make them more affordable. And BMW says the new 7 Series has more equipment than ever before.

"The reason Lexus doesn't have many options is because in some cases the technology simply isn't available," Andreevski said.

As is common practice in the car business, BMW showed a comparison chart which highlighted several features its German and Japanese rivals lacked or charged a premium for, such as automatic boot operation, soft-close function on all four doors, USB and/or auxillary audio inputs, head-up display, voice control, a TV, and high-beam assist (which automatically dips high beams).

BMW wouldn't speculate how many 730d cars it would sell or what percentage they would account for 7 Series sales.

"We've ordered the first two month's allocations, the rest is up to dealers and demand," says Andreevski.

After weak sales last year behind the Mercedes-Benz S-Class, the BMW 7 Series has overtaken its German rival with the arrival of the new model.

So far this year (YTD May) 101 BMW 7 Series have been sold compared to 87 Mercedes S-Classes. The Audi A8 is a distant third with 25 sales but an all-new model is around the corner.

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