BMW ‘pushed share in Saudi market by 7 percent in 2015’

Johannes Seibert, managing director, BMW Group Middle East, revealed in an exclusive interview with Arab News that the company has achieved record sales in the region in 2015 and hiked sales by 11 percent to more than 30,000 vehicles throughout the region.

In the Saudi market, the second largest in the region after UAE, BMW delivered more than 4,000 cars and increased sales by 7 percent.
Siebert confirmed that the focus this year would be on customer service by applying what he calls Future Retail strategy to enhance customer service on all levels.
Over the past five years, BMW regional partners have invested $300 million in new facilities, including two in Saudi Arabia.

These are highlights of the interview:

• How do you sum up BMW Group’s achievements in the region in 2015?

2015 was another very good year for us.
For the first time ever, we exceeded the threshold of 30,000 BMW cars sold in a year – to be precise, 31,710 BMW’s were delivered to our customers, plus 1,806 MINI, thus 33,516 BMW and MINI cars sold in total, across 12 Middle East countries.
This was a 11 percent increase in sales over 2014.
There were various factors that contributed to this growth.
The main drivers in my view are our strong brands and innovative products with a number of attractive new car launches.
In addition, our importers across the region took customer satisfaction to new record levels by continuously investing in their facilities, in staff trainings, and a strong focus on customers’ needs.

• How do you rate the Saudi market in terms of performance last year and prospects this year?

Saudi Arabia continues to be our second biggest market after the UAE.
With 4,125 cars delivered to customers in 2015, we increased our market share in the Kingdom by 7 percent.
Looking ahead, we will continue to work with our partner Mohammed Yousef Naghi Motors to offer our customers outstanding products and services in sales and after-sales, as they expect from our premium brands.

• How do you expect regional markets this year to perform after the drop in oil prices?

The current level of oil prices is not healthy for the oil exporting countries.
I expect customers to become even more discerning with regards to products, value and customer orientation.
I’m confident that BMW and MINI are well prepared for the challenges of volatile markets.

• What strategy has BMW Group for the region this year?

Together with our importers, we are very much focusing on the expansion and upgrading of our retail facilities throughout the region, with the aim to adjust our retail network to the growth of our business, and to offer excellent services to the market.
Over the last five years, our partners have already invested over $300 million in their facilities, and there are several ongoing projects.
Looking at Saudi Arabia specifically, Mohamed Yousef Naghi Motors recently opened two new facilities: a showroom and aftersales center in Al-Qassim to bolster services for customers in the Central Region.
It features state-of-the-art sales and service facilities, Fast Lane Service, a dedicated workshop for the servicing of BMW vehicles and a new car delivery area.
The other one is located in Riyadh on the King Abdul Aziz Road, large enough to accommodate 18 BMW and MINI models on display.
This further compliments the four facilities already located in the Central region, including the recently expanded and refurbished flagship facility in Riyadh on Khorais Road.
An important pillar of our enhanced customer orientation is BMW Group’s ‘Future Retail’ Strategy, which we are presently rolling out across the region.
Future Retail consists of various elements, including digital communication, creating visualization and sales tools such as the Mobile Customizer, an iPad App enabling live car configuration and demonstration during consultations.
It also redesigns the physical experience at the dealership with a new furniture concept, to create a modern, warm, open and friendly atmosphere.
Furthermore, Future Retail evolves the way in which people interacted with customers in the sale process by introducing new roles such as Product Geniuses, non-commissioned experts who will spend as long as it takes to educate car shoppers about the various choices.
He or she will explain the products and help the customer to understand them in more detail. We currently have 17 Product Geniuses across eight of our markets.
In addition, six outlets in five markets have the new showroom layout and furniture, with Saudi Arabia being one of the first.
It was introduced into Mohammed Yousef Naghi Motors’ aftersales facility on Hera’a Road in Jeddah last year and will be in its Sulaimaniyah showroom in Riyadh at the end of March, with more planned for the near future.
Another area of the Future Retail strategy is building on the training and coaching of employees to ensure highest standards of customer orientation.

• What products do you think will have the most appeal in the region this year?

With the launch of the sixth generation of the 7 Series, 2015 was for us “the year of the 7”, and 2016 will also be.
The new 7 Series enjoys strong demand, thus from the launch in October until year-end, we already delivered 1,085 cars to our customers.
Besides this, an important trend is the constantly increasing demand on our X model range, which further expanded its market share in the Middle East markets.
In 2015, the X models accounted for 55 percent of our total sales — for the BMW X5 alone, we delivered 10,109 cars last year.
We launched the second generation of the BMW X1 at the Dubai International Motor Show in October.
First customer feedback indicates that the new X1 will explore additional customer segments for the X model range because it has significantly increased product substance in terms of design, comfort and technology.
I also expect continuous high demand on our M models this year, as we are launching the M2 Coupé and X4 M, which had their world debuts at the recent Detroit Motor Show.

• What other new products do you have for the market this year and do you expect changes in consumer preferences in the region this year especially after reducing subsidy for fuel in Saudi Arabia?

Besides the before-mentioned M model launches, the first launch of the year will be the all-new MINI Clubman in February.
The first model to embody MINI’s new, more grown-up visual identity, it is the most spacious MINI ever built.
It is also the first MINI to enter the premium compact segment.
With regard to fuel efficiency, BMW is in a leading position with our EfficientDynamics engine strategy, aiming for high performance, while at the same time being highly efficient with regards to fuel consumption and emissions.

• Do you expect BMW Group dealers to expand or consolidate in the region this year considering the prevailing volatility of the market?

As BMW and MINI has experienced strong growth throughout the last years, we continue to expand. Besides the two before-mentioned new facilities in the Kingdom, we are planning for additional dealerships in Muscat, and in a few other locations within the region.

• What was new from BMW at NAIAS?

The standout highlights were the world premieres of the new BMW X4 M40i and BMW M2 Coupé.
They were joined by the BMW i models and a range of innovative services encompassing the world of electric mobility in addition to a whole host of BMW ConnectedDrive technologies.
The Detroit Motor Show is very important for us because of the company’s strong presence in the US — it is the second largest market for BMW Group and an important manufacturing location.
Our plant in Spartanburg, South Carolina, produced 400,000 vehicles in 2015, a new production record, making it the largest BMW plant in the world.