Blog: Dave LeggettBMW and Mondeo Man

Dave Leggett | 3 May 2007

I see the new Ford Mondeo is enjoying very good reviews in the British press. Sounds like Ford has produced a very good car once again. Product placement with James Bond might help the image a bit, but there's a fundamental problem: it's a Ford and people don't aspire to own a Ford.

I enjoyed this from Andrew English in the Daily Telegraph newspaper (picked up a cheap used Mondeo myself not so long ago):

“There are two sorts of good car in the world, those you buy because of their great residual value and those you pick up second hand for the opposite reason.

“Ford claims it is trying to move Mondeo from the latter camp to the former with great craftsmanship, low insurance ratings and a range of sensible innovations.”

He signs off by writing: “The Mondeo might be a great car, but last time I looked Dagenham Motors was still selling discounted Fords and people were still dreaming of owning a BMW.”

So, what are the scores on the doors, the numbers?

New car regs, UK market, 2006 calendar year:

  • BMW 3 Series 50,248
  • Ford Mondeo 48,021

Yes folks, BMW 'prestige' 3 Series sales exceeded those of Ford's mass-market Ford Mondeo.

I guess Ford would like the image of the Mondeo to move upmarket, but that will be very difficult to achieve, however good the car is.

And BMW has done a good job of muscling in to take Mondeo/Vectra/Passat customers. People have more money these days and like a prestige badge on the grille.

But here's a thought. How far can BMW go before it gets into difficulties with brand dilution and lower residuals that undermine the brand's attractions to aspirant Mondeo Man?

A report in Dealer Update magazine says that BMW may have flooded the UK dealer regs outlet with '56' plate cars (BMW's 56 plate - that's the year identifier in the number - registration numbers the same as VW and Peugeot's, but BMW doesn't have the same daily rental pressure valve or similar market share). Could be a good time to pick up a nearly new BMW. But that might not be good for new car sales, going forward.

And more models (I'm talking about additions to the BMW line-up over the past decade, X3, X5, 1 Series) means higher rolling development costs as well as steadily rising numbers of BMWs on the roads to lessen the perception of 'exclusivity'.

BMW's product strategy to get into niches and quietly raise volumes has been very successful, no doubt about that. But are there diminishing returns to the strategy via eventually lower residuals? At what point will the consumer consider the Mondeo and 3 Series together and make a decision based more on product attributes and less on (perceived) divergent brand values than is currently the case? 

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