BMW Downsizing to a MINI Cooper-Sized Car

BMW Downsizing to a MINI Cooper-Sized Car

Have you ever heard the phrase “premium downsizing”? It’s this theory luxury automakers have where they believe luxury car drivers would drive the same car with a weaker engine or just a smaller car altogether if they can keep the same luxury comfort features. It would seem that price has become increasingly important in recent years, and these cars would significantly decrease prices.

For the most part, it hasn’t gone that well. Case in point: the Mercedes-Benz A-Class that was released in 1998. While the A-Class did offer some new innovations, it suffered massive losses and didn’t produce the results predicted by this theory.

BMW has always had a firm line on against premium downsizing. Their smallest car on the market is the compact RWD BMW 1 Series. The name even suggests the company could never go any smaller, unless they wanted to start using negative numbers. BMW has even created ad campaigns saying they would never make a tiny FWD car. Now, it appears they are doing it.

Why is BMW Building a Small Car?

What BMW plans to do is put out an entry-level subcompact BMW that would be based off the next generation MINI Cooper (out in 2014). If you weren’t aware, BMW currently owns MINI Cooper, so this might just be a move to bolster sales. A BMW-version of the MINI would likely be priced above the standard MINI, which could bring more drivers into the fold.

The exact reasons are still pretty mysterious, though. Maybe BMW believes it is facing threats from the tiny Audi A1 or premium downsizing is becoming widespread. The most important thing this shows us is luxury automakers no longer believe size matters.

BMW is likely going to get a lot of criticism for this decision, but it does make sense. Massive cars no longer rule the American landscape thanks to high gas prices and a shaky economy. Even at the luxury level, BMW has shown it’s concerned with raising the fuel economy on their cars. They put in new technology like automatic stop start and just released an all-electric car.

Luxury automakers are also trying to target young adults. Younger people are choosing to live in urban environments where only a small car is going to be practical. By appealing to those customers, BMW may hope to make them lifelong customers that will choose their larger models when they move back to a suburban environment.

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