The premium small displacement bike market continues to grow with new arrivals such as Benelli’s TK502 and Leoncino Scrambler (though they’re unlikely to get to Canada) and Ducati’s Scrambler “Sixty2”, which offers a Scrambler in 399 cc format. But perhaps the small bike that was most anticipated was BMW’s G310R.
The G310R is BMW’s first ever low cost, entry level motorcycle with a small capacity, and a joint venture with India’s TVS, it’s been reported on and hyped in the media for the past two years. As with Ducati’s Scrambler last year, and the KTM 390 family a year before that, the G310R has been presented as a major step in the BMW Motorrad plan to grow volume down market, and introduce newcomers to the BMW motorcycle experience.
This week’s Three4Three takes a look at the significance of this change in direction for the Bavarian brand with Michael Uhlarik (columnist) and Rob Harris (editor) representing CMG. We also have an outside guest to add to the mêlée this week; Warren Milner, ex-head of Honda Canada motorcycle division and the guy who can be credited with establishing the small bike genre in North America by taking the bold decision to bring in the Honda CBR125R back in 2007.
Question : What is BMW’s plan? Will a low cost, small capacity motorcycle take away from the prestige of the BMW brand?
RH: I remember chatting with some guys who were deep in the european motorcycle industry last year while I was in Milan for the EICMA show and they were all shocked at what Ducati had done with the Scrambler. Why would a brand whose whole raison d’etre is prestige come up with a budget bike? Wouldn’t that adversely affect the brand and make it harder to sell the bigger bike? I think exactly the same could be said for BMW and the G310R but maybe more so, as it seems to be an even greater leap away from the main fare that BMW is currently serving up. Maybe a mini-GS may have made a better bridge between the two worlds.
MU: All of the legacy brands (the Europeans plus Harley-Davidson) are reaching down market to harvest the huge sales potential of the growing Asian middle class, as well as new, younger buyers in North America. It is a phenomenon called “masstige” (mass prestige) and it’s everywhere from underwear to cars. You pay disproportionately more for a basic item because of the brand, which makes the consumer feel special while adding lots of profit to the manufacturer. It works. The G310R is BMW’s ‘gateway’ to future, loyal customers.
WM: I don’t think the G310R will take away from the prestige of the brand, BMW fans are fiercely loyal and seem to be proud of whatever actions the company takes. Buyers of the G310R may be surprised to find out however that they are looked down upon by fellow BMW riders. Among the prestige brands there is a certain snobbery that suggests that you need to have a large displacement model to have a “real” example of the brand. Dealers are as guilty of this as riders and BMW will have to train dealers to respect these buyers for the concept to work.
Question : Given the significance of the G310R to BMW’s ambitions, and compared to the buzz surrounding the Ducati Scrambler and KTM 390 debuts, early reception in the media appears quite modest. Can any significance be tied to this, or is it too early to tell?
MU : Too early to tell. Media is bought, and for sure Ducati paid handsomely for the outpouring of attention that the Scrambler got. BMW has certainly got its A-game on lately when it comes to brand development, I imagine that they are waiting for spring and after press tests to launch an all-out charm offensive, particularly in the non-motorcycle, lifestyle media. Expect lots of commercials of beautiful hipsters riding on wet night-time streets in the pages of Monocle and Fast Company.
RH: I’m a little gobsmacked by the media silence following the unveiling. After all, the G310R got the usual barrage of media teasers in the run up but then it was unveiled … silence. I would hope that it has a plan for this bike as it is a significant model for them, but even the mighty BMW has been known to make the occasional mistake (the XChallenge, XCountry and XMoto series promised much but quickly disappeared for example). But as Michael pointed out, it’s early days and there’s still plenty of time to push it into the mind of the would-be motorcyclist.
WM: I agree that there will be a stronger push come spring but there is one important thing to remember; small displacement motorcycles (and the necessarily low SRPs that they require) generate very little profit for the dealer or distributor. So there is precious little money to work with and these models are often sold as lost leaders in the hope that they will generate future sales of larger more profitable models. It will depend on how committed BMW are to this investment in their future.
Question : How committed will BMW be to this model? This is a whole new buyer with significantly different expectations, will BMW really be willing to make the changes in both their own and their dealers practices to ensure the G310R’s success.
WM: I think BMW will be surprised how high the expectations of today’s younger buyers are. Inexperienced new riders expect a lot of hand holding and have lots of questions to be answered requiring lots of attention from dealers who are making minimal profit to start with. More importantly these customers will expect that parts and service will be readily available at reasonable cost and this is not something typically associated with the brand. Perhaps this explains why BMW have struggled in the past with lower end models. When Honda launched the CBR125R part of the strategy was an extensive training program for internal staff and dealers to address these issues. Perhaps BMW will need a similar approach.
MU: I have to assume that BMW will remain committed because having been developed as a joint venture with another manufacturer, the production plan involves other invested parties. But BMW’s history with smaller motorcycles is terrible. When they tried to diversify their best selling F650 platform in 2000’s with the F650CS “Scarver”, the XCountry and XMoto, all were unmitigated failures in the marketplace.
In Europe where I lived at the time, they were being sold in BMW car dealerships and marketed almost exclusively outside the motorcycle media to first time buyers. Both newcomers and veteran bikers balked at the stratospheric pricing, forgettable styling and lack of dealer interest. The company’s G450 enduro did even worse. Managing dealers, newcomers and established customers will definitely be the biggest challenge for them.
RH: This is a whole new world for BMW so I guess anything can happen. I’m sure they have a plan for the bike, but as Warren pointed out, it’s a different customer type, so they’re going to have to have a different plan. Also, in the nine years since the CBR125R hit Canada, the small-bike market has become pretty saturated, so it’s not like they will have room for error.
My prediction is that the G310R will have a hard time in the Canadian market but may do well in emerging economies, where the smaller bike rules and there’s a richer buyer that may be swayed by the brand’s prestige.