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Payback time for dealers who invested in new Mini

Mini goes on sale tomorrow (July 7) and already dealers are raising their sights on transaction prices. One enthusiast among the 2,500 buyers who have ordered a car unseen has specified so many options the final bill will be just over £16,000 – against a base price of £10,300.

The average price for a Cooper on the advance order list is around £13,500.

BMW dealers who have made the investment in Mini – virtually all of them – are delighted to see a business built around high-spenders.

Cooper Reading (part of Inchcape Retail) is one of two UK dealer groups to have built self-contained new premises for Mini away from the BMW main site. The other is Williams Manchester, part of Williams Motor Company which has two BMW outlets.

Lews Arthur, Cooper Reading dealer principal, said: “We always wanted to invest in Mini at all our BMW sites. But now we have experienced the car and the marketing we are thinking we have underestimated volume by 25% or 30%.”

Cooper Reading has three sites for Mini. The Bath Road, Reading, site is two miles from BMW in Kings Meadow Road. At Thames Ditton, Surrey, it has separate showrooms on the same site. At Ipswich the group has an integrated BMW/Mini showroom.

The Reading Mini site is ex-Rover, bought from Pendragon which is retrenching from two Reading sites to one for MG Rover.

Trevor Smithers, Mini national dealer support manager, said that of the 153 BMW dealers in the UK, all but five would have a Mini outlet, with an average investment of £100,000.

The gaps arose because of the proximity of one territory to the next in the same group.

Pricing Mini has been a challenge for BMW. Mr Arthur said: “We really do not know what this car will compete with and it might create its own segment. The closest thing in concept – given that it is similarly design-led – is the VW Beetle.”

So as to not disaffect Mini traditionalists, options have been priced to the small-car market level rather than to BMW standards.

Buyers who bought the 1959 original should be attracted to the new Mini by a five-year service contract costing £100.

Early orders for Mini suggest BMW owners want to buy one.

This supports the group's belief in a strategy of developing and selling cars “from Mini to Rolls-Royce” and filling profitable niches.

Freed from loss-making Rover, BMW is confident it can remain independent by developing brands and distinctive models.

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