A decline in sales isn't terrifying; what's alarming is that BMW hasn't yet found the right path forward.

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The first-quarter sales figures for the BMW Group are out, and they're somewhat disheartening.

In China, 155,000 vehicles were sold, marking a year-on-year decrease of 17%, making it the single market with the largest sales decline globally.

In fact, this downward trend has been ongoing for several years now.

In 2022, sales fell by 6.4%, and in 2024, they plummeted by 13.4%, positioning BMW as the luxury brand with the largest decline among BBA (BMW, Benz, Audi).

If this trend continues, BMW's risk of being marginalized in the Chinese market will intensify.

Let's delve into BMW's situation.

Electric Antique: BMW's Pure Electric Ventures

BMW hasn't given up on pure electric vehicles.

Globally, BMW's pure electric sales remain quite impressive.

In the first quarter of 2025, BMW's global sales of pure electric vehicles approached 110,000 units, an increase of approximately 32% year-on-year, with the European market accounting for 70% of these sales.

Of course, a significant reason for this is that the EU's maximum tariff on Chinese new energy vehicles has reached a staggering 45.3%.

Without tariff protection, BMW would struggle to compete with domestic new energy vehicles.

Ultimately, BMW's electrification efforts are clearly lagging behind.

This lag has even resulted in a technological generation gap, earning BMW the nickname "electric antique" from netizens.

In terms of basic power, almost all leading domestic new energy vehicles are redesigned based on pure electric platforms.

However, BMW's main new energy models, the iX3 and i3, are still based on modified fuel vehicle platforms. Setting aside the issue of compatibility with technical routes, oil-to-electric conversions compromise even the most basic range.

For instance, the iX3 has a CLTC range of 550km, whereas the domestic model NIO ES6 in the same class boasts a range of 625km and supports 800V high-voltage fast charging.

This represents a fundamental power generation gap. Data reveals that the monthly sales of BMW i3 and iX3 are only in the thousands.

Moreover, when discussing new energy vehicles, intelligence is another crucial aspect.

This is one of the reasons why smartphone manufacturers like Huawei and Xiaomi are entering the automotive sector.

BMW's intelligence capabilities are even further behind.

Huawei's ADS 3.0 advanced urban driving assistance system is already installed in vehicles, whereas BMW's main models are still stuck at the most basic L2 level of assisted driving.

Although BMW has announced cooperation with Huawei and Alibaba to develop the HarmonyOS ecosystem and intelligent cabins, new models won't be available until 2026.

A distant solution cannot alleviate immediate hunger.

When the Luxury Brand Image Fades

Over the past two years, sales of many foreign luxury brands in China have plummeted. An important reason is that the luxury premium offered by the brand has been eroded by the technical luxury provided by Chinese new energy vehicle manufacturers.

BMW's fuel vehicles are also facing the same challenge, gradually being eroded by emerging forces.

Models like Zeekr, Li Auto, and AITO have reached the price range of BMW's 3 Series and X5 through intelligent configurations and luxury experiences.

This year, Li Auto sold over 90,000 vehicles in Q1.

The luxury vehicle market is finite, and data only illustrates a zero-sum game.

External shocks have already overwhelmed BMW, and there seem to be issues with its internal luxury positioning as well.

For example, BMW MINI's pricing strategy previously went awry, with some models priced below 140,000 yuan, completely blurring the line between the luxury and mass markets. Consumers' perception of BMW as "high-end" is gradually being eroded.

In the "2024 Luxury Brand Awareness Survey," only 49% of respondents believed that BMW "represents high-end," far lower than Mercedes-Benz's 62% and even NIO's 55%.

When brand premium disappears and product strength cannot keep up, yet sales need to be maintained, BMW is forced to choose a path of price reductions.

This further pushes BMW into the abyss.

Dealers Unconcerned About Price Wars

Starting last year, to maintain market share, BMW began using "suicidal price reductions" to exchange for sales.

For example, the guide price for the entry-level model of the BMW 5 Series is 439,900 yuan, but it is now as low as 293,000 yuan, a price reduction of over 30%, while the average price reduction in the industry is 12%.

It's crucial to note that BMW adopts a dealer model, and dealers are unconcerned about the purpose of your price war, only whether they can make a profit.

Large price reductions have resulted in most dealers losing money when selling cars.

To meet sales targets, some dealers have to "sell cars at a loss," while BMW headquarters benefits from the sales growth in its financial reports, creating a distorted ecosystem where "headquarters make money and dealers lose money."

Last year, BMW's first global 5S dealership, Beijing Xingdebao 5S, was forced to close due to funding issues.

Of course, dealers are not stupid, and they can change their strategy in time.

Well, that is to make money by selling new energy vehicles from other brands.

In 2024, the withdrawal rate of BMW dealers reached 15%, a record high.

If BMW does not control this trend, the worst-case scenario is that the withdrawal rate of dealers may exceed 30% in 2025. Such systemic risks are unmanageable for BMW.

Fortunately, BMW's new pure electric platform, Neue Klasse, may be launched this year, and the company has stated that it will accelerate local cooperation. We can see that BMW is making every effort to turn the ship around.

However, facing the "technological crush" of domestic new energy vehicles and changes in consumer perception, can BMW catch up within 2-3 years?

Let's wait and see.