BMW Holds Off Audi as Race for Luxury-Car Lead Tightens

Bayerische Motoren Werke AG held onto the lead in global luxury-car sales as demand for 5-Series sedans and X5 sport-utility vehicles helped edge out Audi AG.

BMW delivered about 1,000 more vehicles than Volkswagen AG’s Audi in May as the race for the top spot tightened, according to figures from the carmakers. Through the first five months of 2014, Audi’s sales climbed 12 percent, outpacing BMW’s 11 percent gain. That helped the world’s second-largest maker of premium cars cut Munich-based BMW’s lead to about 8,200 autos from 11,000 a year ago.

Audi has been closing the gap to BMW in recent years with an expanded model lineup in a bid to become the best-selling luxury-auto brand by the end of the decade. In April, the VW unit rolled out a sedan version of the A3 in the U.S., helping sales there jump 26 percent last month. BMW responded with the 2-Series compact coupe, which went on sale in March.

“BMW is more geared into the second half and into 2015” in terms of model introductions, Arndt Ellinghorst, an analyst at ISI Group in London, said by phone. “They report stronger growth right now than I would have thought, given the product outline.”

Deliveries last month of BMW autos rose 10 percent to 153,023 vehicles, as 5-Series sales gained 11 percent and X5 demand surged 63 percent. Including the Mini and Rolls-Royce brands, sales rose 6.8 percent last month, with five-month demand increasing 7.4 percent to just under 826,900 deliveries.

Delivery Target

“The BMW group continued to achieve record sales in May, keeping us well on track to sell over 2 million vehicles in 2014,” Ian Robertson, head of sales and marketing, said in a statement today.

Global sales by Ingolstadt, Germany-based Audi climbed 11 percent to 152,000 cars in May, lifted by a 43 percent surge for A3 models and a 21 percent gain in demand for the Q3 compact SUV. Daimler AG’s Mercedes-Benz, which also has a target of overtaking BMW in sales by the end of this decade, increased deliveries 10 percent in May to 134,031, buoyed by demand for the C-Class sedan and GLA compact SUV.

BMW declined as much as 1.1 percent and was trading down 0.6 percent at 92.02 euros at 12:59 p.m. in Frankfurt. VW fell 0.3 percent, while Daimler rose 0.3 percent.

Chinese Push

Surging demand for premium models in China and the U.S., the world’s two largest auto markets, is propelling growth at the three German carmakers, which are all targeting record deliveries for 2014. The competition is heating up after Audi briefly passed the BMW brand in sales at the beginning of this year, while new compact models have generated gains at Mercedes.

The five-month sales lead by BMW over Mercedes was about 80,700 vehicles, narrowing from a year-earlier difference of 88,300 autos. BMW introduced the plug-in hybrid i8 last week, its first sports car in more than three decades. In addition to the 4-Series coupe and X4 SUV already on sale, BMW plans to introduce a variant of the 2-Series, the van-like Active Tourer, this year.

BMW is likely to remain ahead of Audi in deliveries through 2015, said Ellinghorst. Even so, a race among the luxury-car makers to maintain volume at the expense of pricing is undermining profitability and brand perception.

“All these guys are defining themselves by volume and not by price realization,” he said. “You can’t call yourself a premium brand if you give away your product with a 20 percent to 30 percent discount.”

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