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BMW’s future development

The picture shows BMW's newly launched M3

Although the North American market operation is still at risk, the implementation of the efficient power plan and the opening up of emerging markets will give BMW confidence in its development.

The recent bad weather of rain and snow did not affect the good mood of BMW Group CEO Norbert Reithofer during the Easter holiday. On March 18, at the annual financial press conference held in Munich, the message that the polite German wanted to convey most was, "BMW not only fulfilled all its promises in 2007, but also aimed to achieve 1.8 million vehicles in 2012." The stated goal is making steady progress.”

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Indeed, sales are not a problem at all for this luxury brand. Even though the world's automobile industry is facing severe challenges due to negative factors such as the rising euro, the weak U.S. economy, and rising raw material prices, compared with other competitors, the BMW Group still ushered in its most successful sales performance in history in 2007: ** *1,500,678 BMW, MINI and Rolls-Royce brand cars were delivered to customers, an increase of 9.2% over the previous year (2006: 1,373,970 vehicles). The BMW Group achieved high-digit growth targets in 2007.

Coping with the North American Panic

However, what annoyed the host of the meeting that day was that more than a hundred Chinese and foreign reporters present took advantage of the U.S. subprime mortgage crisis and frequently asked questions like this The situation is very different from the originally envisioned situation of sharing BMW's 2007 performance.

However, he could not control the scope of reporters' questions. You must know that the "subprime mortgage crisis" that began to spread in the middle of last year has caused the sales of major automobile manufacturers to continue to decline. In the United States, the world's largest auto market, all manufacturers have to consider their own survival issues, and BMW is no exception. Although in the luxury car camp, BMW's sales in the United States last year fell only 5.8%, which was much lower than Porsche and Lexus declined significantly.

Resev cannot avoid this reality. Although he is unwilling to predict the future trend of the US dollar or estimate the sales volume of the US auto market, he still told all reporters: "The United States, as the world's largest The automobile market will continue to create profits for us, and we are capable of meeting all challenges." What explains Reithof's stance is what BMW has already done in the U.S. market. adjustment strategy. In order to reduce the risk caused by the depreciation of the U.S. dollar, BMW announced an investment of US$750 million in the replacement and transfer of factory products. The company will transfer the Z4 produced at the Spartanburg plant in South Carolina, USA, to Europe, and plans to move production at the Graz plant in Austria. The new generation X3 model was transferred to the Spartanburg plant to further improve production efficiency in the North American market. In this way, the Spartanburg plant will be mainly responsible for producing the BMW X3, X5 and X6 for export to markets around the world.

Of course, production relocation is only one aspect of responding to the subprime mortgage crisis. Cost control, production capacity improvement and production efficiency improvement will become the company's focus in the US market. Reithofer has promised that BMW will increase purchases in the North American Free Trade Area and increase production capacity in the United States. The output will jump from 150,000 vehicles to 240,000 vehicles now. As for the research and development field, BMW will consider more R&D tasks are outsourced to countries such as India to cope with unfavorable exchange rate movements.

Reithof also said that the company's future operations will gradually be decoupled from the U.S. dollar. As long as the recent Euro/U.S. dollar exchange rate remains below 1.5, BMW's operations will not be negatively affected. In the U.S. market in the first two weeks of March, BMW was the only manufacturer with an increase in retail sales, but the German BGA Association predicts that in the next six months, the euro/dollar exchange rate will be at the 1.50/1.60 level, which means that BMW in North America The operation of the market remains at risk. What's more, in order to avoid the impact of labor costs, BMW's layoff list of 8,100 employees in the United States has aroused public criticism.