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7 vs. 8: BMW Insiders Clash Over Flagship Future

Outcome of internal culture clash may set brand’s direction

"When possible, make a U-turn" is a standing joke on the 22nd floor of BMW's four-cylinder HQ in Munich. If not exactly in turmoil, then BMW is certainly struggling to deal with some unexpected bumps in the road.

The vaunted Project i that spawned the i3 and i8 is still losing money, and Mini is way off target. The 2 Series Active Tourer is one of the company's hottest sellers, but it's a competent yet unexciting front-drive minivan that does to the brand image what ketchup stains do to a wedding gown. The upcoming 5 Series and the next 3 Series—due in 2018—are expected to remain key contributors to the bottom line, but their design has become more timid and mainstream and their engineering evolutionary.

Then there's the 7 Series. Although BMW's flagship sedan is a competent piece of kit, it's not exactly a sellout, continuing the decades-long struggle to gain traction against the dominant force in the segment, the Mercedes-Benz S-Class. On its own this does not bode well for the forthcoming 8 Series, which is supposed to chase the two-door S-class models. But even before they're launched, the 8 Series twins are already cars without a mission: Mercedes is planning to drop both S-Class two-doors by 2022 to stop the S-Class convertible from cannibalizing sales of the highly profitable SL roadster and to turn the S-Class coupe into a big, swoopy four-door one.

There's now a progressive faction within BMW that believes neither the 7 Series nor the 8 Series, which effectively replaces the slow-selling 6 Series, have a future. They insist the top end of BMW's product portfolio needs to be reinvented and are agitating for the next-gen 7 Series, due in 2022, to be a much more courageous flagship based on a bespoke electric vehicle architecture that will eventually take over from the conservative combustion engine-based concept.

However the conservatives are reluctant to take risks. They have a lot to deal with, from the multi-billion dollar Project i nightmare, to the slow funk at Mini, to dealing with the existential threat to the brand from autonomous vehicles.

What's driving the dilemma among the denizens of the 22nd floor at BMW is the knowledge the company must satisfy loyal owners, who are now progress-shy and getting older, but that to prosper in the future it must attract new zeitgeist-minded customers. And the next 7 Series is shaping up to be ground zero for that tricky cultural clash.