3:00 pm, November 17, 2021
BMW is planning to drastically reduce its trim options as it looks to cut costs ahead of a move towards electrification.
The Financial Times reports that the German brand is looking to ‘shrink the choice buyers have on everything from a car’s colour to its wheel rims’.
The move represents a dramatic change of approach from BMW, which has long-prided itself on its wide range of trim options.
As part of the downscaling, BMW is likely to go from offering ten different rims to five – a reduction of 50 per cent.
Bosses say the decision has been made in order to reach a profit margin of between eight and ten per cent per vehicle.
It is also hoped the new strategy will help to ‘reduce complexity’ at a time when the cost of electrification is starting to bite carmakers.
The firm’s finances are also likely to have taken a hit as a result of the semiconductor crisis, which has ground new car production to a halt.
Nicolas Peter, BMW’s chief financial officer, said the company was scrapping combinations that ‘make no sense’ and are ‘never chosen’.
He said: ‘We will especially reduce the number of available combinations, because certain combinations make no sense at all, and are never chosen.’
He went on to add that customers who choose unusual combinations would ‘probably would have bought something else’, had the choice not been available.
The change of tact from BMW would appear to fly in the face of how other manufacturers do business.
Most car makers continue to provide a wide-ranging trim level in order to bring in extra revenue and increase thin profit margins.
Others, including the likes of Ferrari and Lamborghini, also encourage customers to order bespoke cosmetic alterations in a bid to increase profits.
