Billions in savings on the line, but so is staff morale.
While SUVs are on the uptick globally, with critical markets recording as much as an even split between SUV & passenger car sales, it’s a difficult time for compact luxury cars like premium hatchbacks and so on. The volume is there, it’s just not as voluminous as before, which means a rock-and-hard-place situation for carmakers that don’t want to forsake the segment, but can’t afford to invest as much into the R&D of such models.
Mercedes-Benz and BMW are either already feeling the pinch or can see the pinch coming, with only themselves to blame for offering customers compact-SUV options in the X1 and GLA pilfering a customer base that would have otherwise bought a 1-Series or A-Class respectively. But there’s still demand for the latter two models, so they can’t just ignore it, but it’s just too expensive now to go all-out for a new-generation contender.
In what’ll no doubt go down in history as a bittersweet suggestion (which perhaps originated from a finance department in either Munich or Stuttgart), BMW and Mercedes-Benz are now exploring the possibility of working together to jointly-develop future compact cars.
We’re not adding dramatic effect here. Even though such a venture is still in its very early stages (or so alludes German rag Handelsblatt), the management teams of both companies have acknowledged that they may face blowback from within their respective ranks. While management-level staff will be just fine, it’s the engineers that may retaliate, refusing to work with what they’ve regarded as a sworn enemy for most of their professional lives. The rifts run deep here.
This is even before both companies crunch the numbers and figure out if the potential cost savings is worth taking the risk of angering both their own engineers and brand fans. But if such a venture does materialise, we won’t see a product of it materialise until at least 2025 at the soonest. Which means that there should, in theory, be one more generation of the 1-Series (in addition to the recently-launched A-Class) full of typically-BMW dynamics & characteristics to enjoy before the choice between the two gets that much harder.