Q&A: BMW's O'Donnell Talks Diesel, Digital Marketing

In April, BMW North America named Jim O’Donnell, a gritty, hard talking Scotsman, president. O’Donnell took over from the elegant, diplomatic, and also Scottish, Tom Purves, who is now the CEO of BMW-owned Rolls Royce. While Purves was known for never breaking a sweat, O’Donnell is a rough-riding executive who cracks wise often and speaks bluntly. In his previous post as managing director of BMW U.K., O’Donnell spoke out against the government’s plan to reduce carbon dioxide emissions from cars and in 2004 told a reporter that bonuses taken by four execs at MG Rover, a one-time BMW property, were “the unacceptable face of capitalism.” Three years ago, O’Donnell called out his dealer body, damning some of them as “lazy” and “not hungry enough.” And his view of marketing was evident when last year he said: “Product, product and more product is the way to maintain your position at the head of the premium sector.” One of his first moves has been to increase prices across the board in the U.S. by 2.1%, and he did so with no apologies even as the American economy went through some corrections. This has been a prolific year at BMW. In addition to the 1-Series, BMW has introduced a small crossover, the X6, as well as the M3 series of performance sedans. A slightly tweaked 3-Series goes on sale next month, and two diesel models will hit the market later this year or early next year. Only Lexus sells better than BMW in the U.S. luxury car category, which is down overall 12.3% through August, per Autodata, Woodcliff Lake, N.J.. BMW’s car line has fared better than the industry, off 7.1% and 7.4% for cars and trucks, respectively, not counting Mini. With its line of smaller, better mileage offerings, BMW is pacing to overtake Lexus and again become the king of sales in luxury, behind now by around 7,000 units. O’Donnell and marketing vp Jack Pitney, a veteran of the company and the man behind BMW’s latest “fun to drive”-themed marketing communications, recently fielded some questions from Brandweek.

Brandweek: Are you comfortable with the 2.1% price increase even as car sales are down?

Jim O’Donnell: We are seeing inflation and we just can’t keep absorbing those costs. Materials are going up and it’s just something we have to do. I don’t expect that it will have any effect on our sales.
Jack Pitney: The increase is not out of step with what our competitors are doing. Cadillac announced a 3.7% increase not long ago.