BMW's Mini to expand U.S. dealerships by 20%

Bayerische Motoren Werke (BMW) AG's Mini brand plans to expand its number of U.S. dealerships by 20 percent during the next 18 months to help increase sales.

Mini will add 17 dealer franchises to the 83 that the company operates, said Jim McDowell, vice president in charge of the brand in the U.S., in an interview today in New York. Most of the additions will be in new markets for Mini, he said.

"This could mean that BMW is preparing for recovery," said Jeff Schuster, executive director of global forecasting for market-research firm J.D. Power & Associates in Troy, Michigan. "You can't ramp up overnight."

Mini is bolstering dealer ranks as it endures a 21 percent drop in U.S. sales of its small cars this year through May. Last year, gasoline prices that rose to a record in July contributed to a 29 percent jump in the brand's deliveries. Mini's decline so far in 2009 came as sales tumbled 37 percent for the industry and 29 percent for BMW including its namesake brand.

Sales for Mini starting in 2011 will rise by "double- digit" percentages from last year's 54,077 cars, McDowell said. He declined to be more specific.

BMW has sold Mini cars in the U.S. since 2002. The Munich- based company will now grant Mini franchises to dealers other than those of its BMW brand, contrary to its previous policy. BMW's U.S. headquarters in is Woodcliff Lake, New Jersey.

Among the locations for new Mini dealerships are Allentown, Pennsylvania; Birmingham, Alabama; and Louisville, Kentucky.

"We've had owners in these communities, they've had to drive some distance to get service at Mini dealerships," McDowell said.