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The Thin Red Line | Asymcar

We explore the strategic and tactical considerations behind BMW’s i sub-brand. Why did BMW attach a new BMW sub-brand to a new powertrain rather than using another brand, like Mini? The answer helps explain how innovations and brands inter-relate and how incumbents can attempt to absorb what is potentially non-sustaining.

We consider the pros and cons of innovation within an operating business – “intrepreneurship” – compared with creating an autonomous enterprise for the “new new thing”. I contrast BMW i with General Motors’ failed Saturn experiment.

We consider the burden that regulation, girth, cycle times, legacy practices, financialization and strategy taxes place on incumbents.

Finally, we look at what it takes to cross over the line which separates the device-based nice-to-have infotainment options from the must-have driver and ownership assistants that will inevitably find home in these devices.

via The Thin Red Line | Asymcar.

  • MikeTM

    I’m curious that you all were so skeptical about the i3. I placed an order for one based on the early European reviews that can best be summed up as “odd looking, but a very appealing car”. (see http://www.topgear.com/uk/bmw/i3/road-test/driven giving the i3 an 8 out of 10.)

    The thing I like about the car is that it is at least an attempt to ask the question “what would a car look like if you built it from the ground up, as an electric car, with all of the technology we have available to us today.” So it uses advanced composites and aluminum instead of steel to save weight. It puts the driver up high to reflect modern SUV-seating driving preference, and the weight down low for performance.

    A Leaf is basically a Yaris with electric drive and funky body work. The i3 looks different because it is fundamentally designed and built differently. For sure, I suspect they were targeting the “look-at-me, I care about the environment”-looks of the Prius, and I suspect they would design it differently if they had knowledge of Tesla’s success at the time the project started. And I suspect you’ll see a quick moderation of the design as the early-adopters peter out, and they look for more mainstream adoption. But at least the design reflects a different technological foundation, rather than a mere attempt to look different.

    I also think that the consumer economics are different than what you indicated. A lowest-possible end Tesla is $70,000. A lowest-possible end i3 is $41,350. So that’s nearly a 30K difference. That’s a lot of money. I purchased mine loaded, so it’s about $51K, still a $20K difference, and still a lot of money. I live in California (Silicon Valley), so I’ll get $10K in incentives, plus HOV-lane highway access. Plus, my employer has free-for-employees charging stations. I estimate that I pay $2200 a year in gas. So, that would be $6600 in potential savings over 3 years. So the car becomes rather affordable and appealing with all of that factored in.

    So it depends on what you’re comparing against. I’m sure the Leaf looks a lot better than the i3 from an economics perspective. But I don’t think it compares from a luxury/performance perspective… I’m not cross-shopping the Leaf, I’m cross-shopping the Tesla. And it looks a lot cheaper, any way you cut it, for something with many of the advantages.

    Anyway, love the show, but was hoping for a bit more informed and thoughtful discussion of the i3.

    (Also, how could you not comment on the obvious nods to Apple? the fact that their salespeople are called “geniuses”, the “i” moniker, the business model, that seems ripped out of the original iPod program… it might be simply aping something BMW doesn’t understand, but it seems worth a discussion…)

  • Davel

    Thank you for the discussion. Very interesting.