Press Release
Please allow me a personal remark:
Over the course of the years, the cooperation between the BMW Group and their supplier network has grown into a successful innovation partnership. This is why we treat our suppliers fairly.
Of course, our purchasing division negotiates prices with them. But it is even more important to us to examine their costs and our requirements carefully – together with our suppliers.
This approach has helped us strengthen the cooperation with the supplier network in the last few months. Our experience shows that the interface between supplier and in-house value creation offers considerable potential, which we plan to tap into for our mutual benefit.
It is our goal to keep up our top level of quality while saving costs at all stages of the supply chain. We expect a lot from these efforts. And both partners stand to benefit.
Another issue in improving profitability is our knowledge management.
To meet the various challenges ahead, we need highly qualified specialists and executives. Requirements are changing. Just think about the mobility concepts for megacities we are working on or intelligent solutions in the field of hybrid or electric drive systems.
So implementing all our plans will require us to align our knowledge structures with these new requirement profiles.
What this means for us is:
First: We want to work with the most creative minds. So we will continue our strategic recruitment efforts. This year alone, 500 new jobs will be created. And we will keep on training a large number of young people at the BMW Group.
Second: We are becoming more and more efficient – as our production efforts have shown.
There is no way around implementing efficiency enhancements – given the increasingly fierce competition among carmakers and global operations.
But what this also means for us is that we need fewer people in some areas. As announced a few weeks ago, we want 3,100 permanent staff to accept voluntary redundancy and severance packages.
We understand good management as acting with foresight.
We are now creating the foundation needed to secure employment in Germany and at our international locations over the long run.
We are one of the most international companies in our industry. Four out of five BMW Group cars are exported.
But: We are committed to Germany as our industrial base. Germany is where we are rooted. This is where our heart is and where it will remain.
PART III: Outlook and goals 2008
Ladies and Gentlemen—
We want to continue our successful development in the business year 2008.
But there is something we must not forget:
External burdens such as currency fluctuations and raw material prices will impact our earnings situation.
Furthermore, 2008 will see particular uncertainties due to the effects of the Subprime crisis. One result might be a slowdown of the US economy which could also hurt the whole automotive industry.
Nevertheless: We have set ourselves again ambitious targets for the business year 2008.
We want to achieve record sales for all three automobile brands.
We want to stay in the lead as the world’s most successful premium car manufacturer.
We plan to outperform last year’s earnings before taxes— adjusted for the book gain from the Rolls-Royce exchangeable bond in 2007.
We want to improve earnings quality in 2008. This will also be reflected in our key performance figures such as return on sales and return on capital.
Our strategy details our long-term goals.
You know that by 2012 we want to achieve:
a return on capital employed of 26 percent in the automobile segment
as well as an EBIT-based return on sales of 8 to 10 percent in the automobile segment.
Keeping these goals in mind, allow me one final remark: It’s not over till it’s over. There have been several times in which one or the other car company was very euphoric. But what matters most is who achieves the goals over the long-term and can hold this position.
For all of us at the BMW Group one thing holds true:
We deliver on our promises.
Thank you very much for your attention!
