What Choice Is There?
My friend with a 1997 BMW 540i decided it was time for a new car. He has had spectacularly bad service from Beverly Hills BMW and there was always something not working on his car. The sales experience from Shelly BMW wasn't bad, but when he bought his car back in 1997, no one was dealing on a 540i, least of all the LA-Metro BMW dealers.
It was time to step up to a bigger and better car. So what choice is there above a 540i? In LA, when you think about it, the choices are pretty slim. There is a Mercedes S-Class, the BMW 7 or what?
Let's look at the competition for large 4-door luxury sedans. There is nothing from the US that remotely competes at this level. Perhaps the new Cadillac STS (not yet on the market) will create some interest, but my guess is that a BMW or Mercedes driver isn't going to be lured by a lower price or GM's incentives. Ford's Lincoln division has nothing (no the "Ultimate" Town Car isn't very ultimate). Chrysler doesn't compete in that category at all.
The Japanese have some very uninspiring offerings. Nobody wants or buys the Infiniti Q45 flagship. The Lexus LS430 is there, but with only one engine offering, it can't compete with Mercedes or BMW on the horsepower (or prestige) front. The Acrua RL is already in the grave with the dirt being thrown over the coffin. The new RL is due in a few months, but not soon enough. In addition, the RL is a front drive sedan with a nice Honda V6 under the hood. To be considered in the large luxury sedan segment, you have to have rear drive and a V8.
The Koreans don't play in this market segment.
So what is left? There is the Audi A8L and the Jaguar XJ. Both of these cars always seem to run in the shadow of the Mercedes S-Class. The sales numbers for the past 4 months tell the story:
Mercedes-Benz S-Class: 5,778 (aging and to be replaced soon)
BMW 7-Series: 5,528 (not bad considering the reviewers hate the styling and iDrive)
Jaguar XJ: 3,230 (a marked improvement over the old XJ)
A8L: 1,292 (dismal, considering how nice the A8 is)
There is also the quixotic adventure of VW into the large luxury sedan market with the anonymous Phaeton. It's long been stated that VW's target is the Mercedes-Benz S-Class. L.A. is one of the few markets that might accept the new VW Phaeton; but sales of the big luxury VW are understandably slow. People just aren't interested in paying $65-90,000 for a car with a VW badge. VW sold only 626 Phaetons in the past 4 months. Unfortunately, it's likely that almost all of those sales were poached from sister company Audi. The Phaeton and the A8 share many common components, including engines, Quattro all wheel drive, transmission and platform. I still don't see the point of this exercise.
For interest/comparison, Toyota's Lexus division kills them all, although the LS430 isn't in the same class as the other luxury sedans listed above. I put it as more of a competitor to the E-Class, 5-Series or A6. Lexus sold a whopping 10,583 units during the same period. There is definitely a market for bland; however, in LA, Lexus is still a "wanna be" when it comes to the big prestige luxury sedan race.
Let's get back to my friend. The BMW has the sportier image. It also looks big and it's decidedly the more masculine than the Mercedes. The Mercedes is a bit more "established" and "sedated". The BMW is likely the driver's choice over the S-Class; however, I wouldn't mind the S55 AMG version of the S-Class. BMW swears that there will be no M7, so the AMG variant of the S-Class has an edge in that category.
My friend was also attracted to the shorter wheel base 745i. Mercedes no longer offers the short wheel base S-Class in the US. I guess that us Americans only want BIG. The long wheel base S-Class and the 745iL were a tight fit in his garage. He didn't like the "old lady" image of the Jag XJ and the Audi A8 was not even on the short list. He forgot about it! For him, there was only one choice: the BMW 745i.
Despite the constant complaining from the press and the "BMW Faithful", the new (three years old) 7-Series, with Chris Bangle styling and the universally-hated iDrive system, is still a very popular choice here in LA. As the sales numbers show, compared to the S-Class, BMW sells almost as many 7s, with only 3 model variations and 2 engine choices. Mercedes sells its "mighty" S-Class in the US with 4 variants and 4 engine choices. There are even more variants in Europe. So when it comes down to the bottom line, there are only 4 choices for the big luxury sedan crowd. Each one appeals to a different buyer.
The BMW 745i won the race. I think it won the race by default. The sales and service experience at the only BMW dealer in the area, Beverly Hills BMW, has been enough to turn him from BMW. But it wasn't a deterrent. I know that he originally didn't like the 7-series styling, but three years later, he bought a 7, so the styling wasn't a deterrent. He freely admits that the iDrive and the "mouse" controller are a pain to deal with and much too complex. Yet this wasn't a deterrent either! BMW has had a less-than-stellar repair record with the New 7, but this wasn't a deterrent. So why did BMW win the short race? Well, it's the BMW badge and image, naturally. The 7 has a strong, muscular, masculine presence. And, most importantly, he won't get snubbed at the valet at either The Ivy or Sunset Blvd Hamburger Hamlet.
This is L.A. -- image is extremely important. It matters more what other people see you in and what they think of you in it. All the service problems and shortcomings of the 7 really didn't matter in the final analysis. BMW was going to get the sale no matter what. There really isn't much competition in rarified field of big, serious, comfortable and fast luxury sedans.
