Cheap Gas Not to Blame for Plunging Mini Sales

Last year was a great one for most automakers in the U.S., but BMW’s Mini unit struggled, with sales down 16% in its largest market.

Some linked the brand’s tumbling sales to falling gas prices and too many variants of similar models, but David Duncan, vice president-Mini of the Americas, lays the blame on one thing: lack of availability of the new Mini Hardtop, its best-selling model.

The new Hardtop is the third redesign by BMW since 2001. It was widely anticipated in early 2014, but it was not available in the U.S. until April. The lack of product caused first-quarter sales to plummet 30%, Duncan says.

Once the new model became available, along with an all-new 4-door version, Mini started racking up record deliveries, Duncan says.

“If you look at where we were as we ended the year, with good availability finally of the Hardtop and starting to get the 4-door in stock, November surpassed the previous year, then December surpassed the previous year. December 2014 was our best December ever and our best month ever,” he tells WardsAuto .

The popularity of the new Hardtop is not surprising. It is greatly improved over the two previous versions, and its larger dimensions make it more appealing to a wider audience.

The car now is based on BMW’s high-volume UKL 1 front-wheel-drive platform, and it is stretched in every direction. It’s almost 4 ins. (102 mm) longer, 1.7 ins. (44 mm) wider and 0.3 ins. (7 mm) higher than its predecessor. The wheelbase also has been extended 1.1 ins. (28 mm), and the track width has been enlarged.

The new platform gets two all-new, BMW-designed engines and transmissions (in place of the previous cost-sensitive engines jointly developed with PSA Peugeot Citroen and Chrysler), and both feature all-aluminum construction, turbocharging, direct injection, variable camshaft control on the intake and exhaust sides and Valvetronic VVT.

The car is roomier, more practical and still delivers the brand’s trademark go-kart handling and performance.

Mini’s base 1.5L 3-cyl. engine was just awarded a 2015 Ward’s 10 Best Engines trophy, winning kudos for its torque, fuel efficiency and lusty exhaust note.

Duncan discounts the idea fuel prices will have a big influence on current or future Mini sales and downplays the impact poor-selling models such as the Paceman CUV had on Mini’s overall performance in 2014.

“Fuel efficiency isn’t even in the top three reasons why people buy Minis,” he says.

“There are lots of reasons to buy a Mini besides fuel economy, such as the driving experience and community of being a Mini owner.”

Indeed, WardsAuto data show most of Mini’s sales slump occurred before gas prices began their nosedive last summer, and sales since have recovered strongly even while pump prices continue their downward plunge.

The Paceman, a 2-door CUV hatchback based on the Countryman platform, was introduced in 2013 and no doubt has been a disappointment, selling just 2,082 copies in 2014, down 36% from the previous year.

But Paceman’s 1,180 fewer sales only accounted for about 10% of Mini’s 10,400-unit shortfall in the U.S. last year.

The big hitters in the Mini lineup remain the Hardtop and the Countryman CUV, which has seen sales rise from 16,683 units in 2011 to 22,645 last year.

BMW management board member Peter Schwarzenbauer said last November that Mini eventually will trim its model lineup from seven models to five, but Duncan says seven models will remain in the lineup in the U.S., at least in the short term.

The Clubman, a stretched version of the Hardtop with clamshell doors in the back instead of a conventional hatch, was discontinued midyear and replaced by the new 4-door Hardtop, Duncan says.

“We had seven variants, lost the Clubman in the middle of year, but then we picked up this 4-door car later. We lost a model, and then gained a model. So we’ll just keep looking at the product mix,” he says.

Mini’s latest introduction at NAIAS was the John Cooper Works Hardtop, a high-performance model touting Mini’s most powerful engine ever. Hybrid-electric, battery-electric and other powertrains are a possibility in the future, but not this year.

With the pipeline now full of new Hardtops, 4-door Hardtops and the Countryman still selling strongly, Duncan is optimistic about 2015. “We don’t talk numbers, but I foresee 2015 being Mini’s biggest year ever in the U.S.,” he says. So far the brand’s best year was 2013, when it sold 66,502 units.

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