Luxury carmaker has quadrupled its sales in the Middle East since 1994
By Will Rasmussen
Daily Star staff
ABU DHABI: Luxury car maker BMW expects sales in the Middle East to reach more than 13,000 in 2005, driven mostly by a boom in sales in Iran. BMW's growth in the Middle East has quadrupled from 2,800 car sales in 1994, when regional offices were first opened, to 10,590 sales in 2004.
"We have a couple of emerging markets that will open in the next 10 years in Iraq, Afghanistan and Iran," said chairman of the board of BMW Helmut Panke, who visited Abu Dhabi for the launch of the new 7 series, M5 and M6 models. "We should also see double-digit growth in the GCC market."
High oil prices and the rise of long-term financing and leasing agreements are spurring the increase in sales in the Middle East, said BMW's regional director Guenther Seemann.
BMW is hoping that the launch of the updated 7 series in the Middle East, now the fourth most important market for the company's flagship brand, will offset a 4.1 percent decline in earnings in the first quarter of 2005 caused by a weak dollar and high prices for raw materials.
An 8.2 percent rise in retail sales, however, meant first quarter revenue only dipped 0.8 percent from the first quarter of 2004.
"That was our best first quarter in the history of BMW," Panke said. "Despite adverse external factors and change of the group's strongest-selling model series, our goal of achieving approximately the high earnings level of 2004 remains unchanged."
BMW sold 3,000 of its top-of-the-line 7 series cars, which can cost well over $100,000 each, last year in the Middle East, where luxury cars are the most popular.
"Our company focuses on a clean-cut, premium product, not the mass market," Panke said. "This is a strong fit for the Middle East market."
However, BMW still does not produce enough cars in the Middle East to open a regional assembly line, Panke said.
BMW still lags behind archrival DaimlerChrysler, which sold 11,900 cars in the Middle East last year.