UK Markets closed
  • FTSE 100

    7,122.32
    -6.89 (-0.10%)
     
  • FTSE 250

    22,646.08
    -38.76 (-0.17%)
     
  • AIM

    1,182.30
    -6.44 (-0.54%)
     
  • GBP/EUR

    1.1690
    -0.0076 (-0.65%)
     
  • GBP/USD

    1.3235
    -0.0067 (-0.5029%)
     
  • BTC-GBP

    37,380.69
    +1,332.01 (+3.70%)
     
  • CMC Crypto 200

    1,367.14
    -74.62 (-5.18%)
     
  • S&P 500

    4,538.43
    -38.67 (-0.84%)
     
  • DOW

    34,580.08
    -59.71 (-0.17%)
     
  • CRUDE OIL

    66.22
    -0.28 (-0.42%)
     
  • GOLD FUTURES

    1,782.10
    +21.40 (+1.22%)
     
  • NIKKEI 225

    28,029.57
    +276.20 (+1.00%)
     
  • HANG SENG

    23,766.69
    -22.24 (-0.09%)
     
  • DAX

    15,169.98
    -93.13 (-0.61%)
     
  • CAC 40

    6,765.52
    -30.23 (-0.44%)
     

BMW Missing Out on China’s Karaoke Fans Exposes Digital Gap

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·2-min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

(Bloomberg) -- BMW AG rarely has to answer this question in Western showrooms, but it’s becoming increasingly important for selling cars in China: Can I sing karaoke in this automobile?

Most Read from Bloomberg

Customers in the world’s biggest auto market are demanding that sing-along apps such as Changba work in new vehicles. Local manufacturers XPeng Inc., Nio Inc. and BYD Co. are at the forefront of this trend, besting Western rivals by offering models with karaoke microphones. The push extends beyond music, with Chinese buyers expecting seamless access to features like in-car payment and social-media connectivity.

“We’ve identified this as a challenge,” said Christoph Grote, BMW’s digital car chief. “Chinese consumers are the most demanding when it comes to digital technology in the car.”

Tapping into local tastes is crucial to win over customers in China, where electric-car adoption is accelerating and homegrown auto offerings are mushrooming. The country is the biggest market for BMW as well as Volkswagen AG, accounting for 36% and 40% of sales, respectively.

Local brands are trying hard to win over the digital-native crowd. Zhejiang Geely Holding Group Co. earlier this year started Zeekr, an all-electric marque aimed at millennials, and carmakers are using local influencers to tout their models as online buying becomes more widespread.

Western manufacturers are lagging behind integrating Chinese digital ecosystems into their cars, according to Kearney. More than two-thirds of local consumers view Chinese navigation apps as a must-have feature and Western brands risk falling behind in the “everything-connected” era, the consultancy said in a report last year.

While Western carmakers have traditionally viewed digital connectivity as a feature they can charge customers extra money for, its Chinese rivals are using it as an enabler to integrate third-party services, said Bill Russo, chief executive officer of Automobility Ltd., a Shanghai-based consultancy.

“Such digital services are dominated by local ecosystem players in China and multinationals often lack the deep local collaborations needed to generate revenue from these services,” Russo said.

BMW doesn’t yet offer karaoke features in its cars, but has worked with Tencent Holdings Ltd. to integrate a function to pay parking fees via the popular WeChat Pay app.

The manufacturer plans to use a joint venture formed last year with Nanjing-based technology company Archermind Technology Nanjing Co. to expand its connectivity features and is open to additional partnerships, Grote said.

“You need a technology road map for China and you need local capabilities,” he said. “Our joint venture allows us to develop directly within the Chinese technology ecosystem.”

BMW rose 2.2% Monday, taking year-to-date gains to almost 20%.

(Adds shares in last paragraph)

Most Read from Bloomberg Businessweek

©2021 Bloomberg L.P.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting