International Business Final Project

By: Aaron Prescott Kris Miner Micah Edmond Travis Harrant
BMW GROUP

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Table of Contents
INTRODUCTION .................................................................................................................... 2 Aaron Prescott ...................................................................................................................... 3
Products and Services.................................................................................................................. 3 Product Development & Government Policy .......................................................................................... 4 BMW Global Production, Outsourcing, and Logistics ......................................................................... 5 Vertical Integration............................................................................................................................................... 7 Foreign Direct Investment ................................................................................................................................ 9 Greenfield Strategy ............................................................................................................................................... 9 BMW s Operation Segments.......................................................................................................................... 11 Works Cited (Aaron) ......................................................................................................................................... 12

Kris Miner ........................................................................................................................... 14
Culture .......................................................................................................................................... 14 Works Cited (Kris) ............................................................................................................................................. 21

Micah Edmond ................................................................................................................... 23
Marketing ..................................................................................................................................... 23 Acquisitions ........................................................................................................................................................... 23 The Four P s ........................................................................................................................................................... 26 Push and Pull Strategy ..................................................................................................................................... 29 Works Cited (Micah) ......................................................................................................................................... 31

Travis Harrant ................................................................................................................... 32
Financial Analysis ...................................................................................................................... 32 Works Cited (Travis)......................................................................................................................................... 37

Herbert Bowen .................................................................................................................. 38
Current Challenges and Solutions ......................................................................................... 38 Mergers .................................................................................................................................................................... 39 Globalization Strategy ...................................................................................................................................... 41 Strategic Alliance ................................................................................................................................................ 42 Works Cited (Herb) ........................................................................................................................................... 45

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INTRODUCTION
BMW Group Company is powerful MultinationalEnterprise, represented all over the world with more than 94,000 employees and over one million vehicles sold every year. Importers in 120 countries represent the BMW and worldwide sales organization comprised 24 sales subsidiaries. They are one of the most successful multi-brand premium car manufactures in the automobile industry. They are the only manufacturer of automobiles and motorcycles worldwide that concentrates on the premium standards and outstanding quality for every one of their models. Being one of the few automobile manufactures that concentrate exclusively in the premium market of automobiles, they offer an array of products. The BMW and Rolls-Royce brands of the company serve the premium and ultra premium segments in the automobile market. They also serve the premium small car segments with their Mini brand. BMW models include, Sedans, Coupes, Touring, Compacts, SUVs, etc. BMW has been making cars for almost one hundred years. They began as an aircraft company and then used the meticulous engineering to design top of the line cars. BMW is synonymous with high quality and performance, which is reinforced by strong brand recognition and customer loyalty. Introduction by, Aaron Prescott

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aron Prescott
Products and Services
BMW provides its customers with premium luxury and sports model automobiles and motorcycles. For almost a century BMW has maintained a reputation of excellence ever since the first motor was built. The First BMW engine that was produced was the, M2 B15 Victoria motorcycle (bmwdrives.com). BMW began to move away from the aircraft industry because of the armistice agreement Germany signed at the end of World War II, which prohibited the Germans from making aircrafts. In 1922 BMW, constructed the R32 motorcycle that was BMW s biggest seller, selling 3,100 bikes till 1926. The R32 showed a strong impression at its world premier at the Berlin Automobile Show. With the great success of the R32 BMW began to move into vehicle construction even before automobiles were invented. This movement is the point at which BMW established their trademark boxer engine design and continue until present day. 1928 was the year BMW presented their first automobile for sale called the Dixi 3/15. BMW purchased a car factory in Eisenach, Germany and with it a license to begin building the small vehicle. Since then BMW has been producing top of the line automobiles available all over the world. The current models BMW produces today are, the 1-series, 3-series, 5-series, 6-series, 7-series, Z-series, X-series, M-series, Xm-series. BMW uses a unique numbering system to identify their models. Usually the lower the number the

The move too hybrid vehicles over the globe has become a growing concern for many automobile companies. BMW s M series is a unique model. and their focus is to. 4 smaller and less expensive the car. The two digits following the series number indicates the engine size and the.Page. The M models are offered in all the series BMW produces and includes high performance engines and aftermarket parts to enhance the driving experience. In the U. The Z-series is BMW s sports convertible model and xseries is BMW s SUV models.recently President Obama announced new fuel efficiency standards to increase automakers research and design teams to produce newer technology that will return higher fuel efficiency. eradicate emissions and to utilize regenerative sources of energy (Just-auto). which indicates coupe or all wheel drive.S. it comes with high performance and always a higher cost. i or d specify fuel injection or diesel. BMW was the world s first car manufacture to prepare medium a long-term development of its vehicles in alignment with a hydrogen-based operation. BMW CleanEnergy. Along with the hydrogen engine BMW announced that the companies first mass-produced electric car would be released in 2013. The Mini E. Product Development &Government Policy Since 2004 BMW has spent millions of dollars in R&D to advance the BMW name in the alternative energy movement. BMW calls their alternative energy approach. In some cases after the engine size numbers certain models will have a c or x. under BMW s Mini Cooper brand will be a fully powered battery-operated .

Its light weight and stronger aspects will come from a high tech carbon fiber that will allow the Mini E to have a 160 mile range on a single charge. Egypt. Mexico.Page. stronger. Brazil. Austria. Thailand. Malaysia. and Logistics BMW manufactures products in thirteen countries on four continents. BMW has a strong share invested in the U.0). Their motorcycles are manufactured in Berlin and the Husquvarna brand in Italy. . the USA. BMW Global Production. Although BMW and the other European automobile makers are late arrivers in the electric hybrid sector. Germany. will be lighter. the Philippines and Vietnam.S market and has government regulations become stricter. South Africa. and safer than any other current electric car. The Mini E. Outsourcing. Indonesia. which are produced in Great Britain. 5 automobile. BMW also owns the MINI and Rolls-Royce brands. BMW plans to surpass other current hybrid vehicles on the road. BMW automobiles are produced at twenty-four different locations. BMW has to find ways to alter their strategies and remain competitive in foreign markets BMW will effectively transition into the hybrid sector and maintain the same line of excellence and instill their reputation of The Ultimate Driving Machine . BMW s worldwide subsidiaries and manufacturing plants are located in. faster. BMW Group is currently the only company that will be launching a volumeproduction vehicle on the market that features carbon fiber-reinforced material (GAS 2. the UK.

com). Germany.com). South Carolina.com). 335 BMW Sports Activity Vehicle centers. 142 BMW motorcycle retailers. BMW has over three hundred automobile sales centers. BMW maintains premium automobiles throughout the world. BMW only has one manufacturing plant located in North America and its located in South Carolina. 6 To Ensure customer satisfaction all around the world BMW maintains the same standards of quality. BMW s group sales for North America is located in Woodcliff Lake. and financial service organizations all throughout the US. New Jersey. each plant making its own contribution to the smooth operation of the production network (bmwusfactory. The Spartanburg plant is a Limited Liability company and is a subsidiary of BMW . In the United States BMW s major manufacturing plant. BMW has had a presence in the United States since 1975 as BMW of North America LLC. 90 mini passenger car dealers. located in Spartanburg. In recent years BMW of North America has grown to include marketing.5 million vehicles.Page. BMW s integration of production and logistics systems within the twenty-four manufacturing sites around the world offers many advantages for its customers. greater efficiency in the supply of production materials helps to speed up the delivery of cars and motorcycles to customers. safety and processes at all of their locations around the world to guarantee worldwide premium products. recently in 2009 BMW s manufacturing plant in South Carolina celebrated fifteen years of vehicle manufacturing producing 1. sales. (BMWgroup. and 31 RollsRoyce motor car dealers (bmwusa. is a subsidiary of BMW GROUP in Munich. First and foremost.

one in particular gave an in-depth response (Does BMW use more of a vertical or horizontal integration strategy around various locations in the world?) Based on the response I believe the representative may be involved in managing BMW parts for various assembly plants around the world. but I never received a name or title of the representative who answered them. I called Mrs. About a week later I received an email from a generic email account with my questions answered. She was very helpful. Interview from a BMW Representative (at their New Jersey Headquarters) Mid way through the semester I spoke with a representative from BMW. I explained to her I was conducting an international business project and had a list of questions I was wondering if I could get answered. Of the various questions I asked.Page. 7 Group s global manufacturing network. I emailed her my list of questions and she forwarded them someone who could answer them. Mrs Wright from their New Jersey headquarters. Vertical Integration Recently BMW has started preferring the make over the buy option in some countries in an attempt to cut cost (Interview Questions). BMW began relying on more vertical integration compared to past years in order to strengthen the . Wright back and she assured me they were from a reliable employee but could not remember who she gave them too. The plant manufactures all of the BMW X5 and X6 sports utility vehicles for distribution around the world.

97% in 2005. to reduce . Many suppliers operating in such sectors of the component supply industry fear BMW might re-in source all of the pressed parts activities thus undermining their businesses (Interview Questions).com). BMW sees the move towards a higher level of vertical integration in some specific sectors in various countries. 8 capabilities of their OEM car parts. connected directly to the assembly area by two tunnels through which electric tow trains feed the production lines (Autointell. such as Germany. German automakers factories were running at significant high utilization rates. To maintain smooth and efficient flow of production materials to plants around the world. Where available BMW employs a Just In Time supply strategy. BMW parts are shipped directly to the assembly areas. BMW justified the upper level decision with the rising high logistical cost of pressed parts. and free up in housing of resources.Page. and provide space for the Just In Time suppliers to carry out their work as close as possible to production. The shift to produce more in-sourced parts came when. act as a receiving and sequencing facility. In 2007 BMW started the expansion of the stamping plants in Leipzig and Regensburg with a total investment of 200 million (Interview Questions). The move towards Just In Time supplying and using a more vertical integrated decision making system is BMW s Six Sigma philosophy. The ILC provides two functions. will be beneficial to increase productivity. Each plant has a large warehouse. BMW established the Integrated Logistics Centre (ILC).

in New Jersey. Greenfield Strategy By investing in Greenfield production plants in various countries.S citizens. As a global players BMW s flexible network of 24 production plants in 13 countries ensures that customers receive exactly the car they have ordered. By establishing a local production plant.Page. BMW is able to enhance local acceptance in the market and become a local player. 9 defects.00 jobs. eliminate waste and cut costs throughout the company (Hill).S citizens.org). BMW s Foreign Direct Investment in the United States has had provided thousands of jobs for U. to U. BMW can reduce high import costs of importing fully assembled automobiles to specific . Foreign Direct Investment BMW Group is very successful in global production. boost productivity. tailored specifically to their wishes and preferences (made by the BMW group). The expansion provided 1. In 2008 BMW announced that they were investing 1 billion dollars in their Woodcliff Lake headquarters. This investment is the largest BMW has mad in America aside form its manufacturing facility in South Carolina (Ofii. BMW realizes the importance of creating opportunities of local production in foreign countries and they capitalize on opportunities to penetrate and develop markets with long-term growth potential (made by the BMW group).

(CKD). they can also be used in such cases to offer products in emerging market at competitive prices (made by the BMW group). BMW s Greenfield expansion has the potential to make total production capacity to increase to more than 100.Page. India. Russia. In 2013 these companies are only forcasted to account for 1. BMW explains the benefits of natural hedging.000 units/year in line with growing market demand in the long term. and ASEAN (Malaysia. One of BMW s current Greenfields investments is located in Shenyang China. completely knocked down. BMW calls these local production plants. and BMW is planning to expand the production plant beginning in 2010.com). The plants that BMW has in these countries do not feature full-fledged car production buy only assembly of CKD s kits shipped from elsewhere to sidestep import tariffs which are strongly enforced in these countries (autointell. BMW is able to make use of these local Greenfield production plants for natural hedging.com).000 units in the 1st step the capacity can be gradually increased up to 300. BMW has also taken not of potential emerging markets for production. A high level of purchase volume in key sales regions with differing currencies serves to balance out .7% altoghether in the premium market. Indonesia) countries will double their share of production compared to 2009 (Bmwgroup. In the CKD process BMW assembles cars locally from imported parts and supplemented by parts produced locally and essentially fulfilling the local content requirements imposed by different countries government regulations. Egypt. Vietnam. 10 countries. Thailand.

com).00 units by 2012. In recent years. Automobiles.com). it was increased from about 30% to more than 60%. The BMW automobile segment includes . Motorcycles. the NAFTA region accounted for some 9% of BMW s global purchasing (bmwgroup. This will allow BMW to decrease its foreign exchange rates to the US and decrease transportation cost. they are. Another aspect is purchasing in the NAFTA region for production in Europe and other regions.00 to 240. BMW plans to reduce dependence on foreign exchange rates by utilizing the natural hedging it has implemented over various countries. the BMW Group wants to expand its natural hedging sustainably over the medium term and thus significantly reduce its dependence on volatile foreign exchange rates (bmwgroup. In 2006. BMW plans to expand the production capacity at Spartanburg Plant located in the USA from 150. and Financial services. By increasing the CKD assembly plants world wide BMW plans to cut down significantly on foreign exchange rates. BMW s Operation Segments BMW is divided into three operation segments. One aspect is the local content of the vehicles manufactured in the USA. Exchange rates have become a burden for the BMW GROUP in recent years. 11 the flow of merchandise as well as make up of currency fluctuations and the associated trading risks (made by the BMW group).Page. In light of its successful retail trend in the USA.

Web. This segment sells its cars and off-road vehicles through authorized dealers and independent import companies (Businessweek). Auto UK.Page. The main concentration is mostly on leasing. 2010." Auto UK. The leasing aspect deals with retail customers and dealer financing to ensure the leasing opportunities are available to all customers and remain equal to all possible leases. The segment also focuses on selling cars and SUV s under one of the three BMW brands. "BmwUSA. The financial segments also handles Fleets business. . and selling of the BMW motorcycles." The BMW Group Production Network. 1 May 2010. Mini. BMW. Both the automobile and motorcycle segments offer spare parts and accessories for purchase. The motorcycle segment focuses on manufacturing." BMW Group in North America .com/Manufacturing.aspx?id=1932>. 2010. N. 2010. customer deposit business. and assembly. manufacturing. Web. <http://gas2. Works Cited (Aaron) "gas2.com. assembly. 12 research and design. 04.. 1 May 2010. Web.bmwusfactory.org/2010/04/22/bmw-says-first-electric-car-themegacity-is-coming-in-2013/>. 1 May 2010. 22. . The last segment of BMW s operating segments is financial services. "BmwFactory. <http://www.org.p.com. and insurance ventures. and RollsRoyce.

Print. Web. 1 May 2010.com/research/stocks/private/sna pshot. 1 May 2010.bmwgroup.bmwgroup.com/Standard/Content/CompanyInformatio n/BMWGroupinNA. 1 May 2010. <http://www. "Autointell.ht ml>. Hill. L.org.Page.businessweek.bmwusa. 2010." Strategies. N.com/bmwgroup_prod/e/0_0_www_bmwgr oup_com/unternehmen/unternehmensprofil/strategie/strategie.S. "bmwgroup.S.pdf+bmw+"gr eenfield"+investments&hl>..autointell. N.com.: McGraw-Hill/Irwin. N. <http://www. "Businessweek. 7th ed. Web. Charles W.htm>. Economy of Greenfield Projects by U. 13 <http://www.com.a.p. 2009.com/bmwgroup_prod/e/nav/index. Web. Boston [u.p..com/european_companies/BMW/mini/oxf ord-plant/bmw-oxford-plant-07-logistics..com. N." The Impact on the U.." BMW Logistics.p.asp?privcapId=704634>. International Business Competing in the Global Marketplace. 1 May 2010.html? http://www. <http://investing." Bmw Stock Research. 2010.org/docs/Greenfield_2009_Report.ofii. 2010. <http://www.aspx> "OFii. Web. Subsidiaries of Foreign Companies .p. . 2009.

With over one hundred thousand employees. South Africa. but also how each countries culture is different and how these individual countries need to interact with each other. BMW also outsources to six other countries and has research and development in over thirty countries. BMW not only has to look at how its German culture affects these countries. The same can be applied to a corporation instead of a man. law. which covers more than one hundred and fifty countries. Great Britain. morals. builds its corporate culture through its management style and its employees. based in Munich Germany. 14 ris Miner Culture Culture is a word that does not have one solid definition. BMW is a multinational corporation. the United States. which are located in six different countries. China. One of the most popular definitions is that by Edward Taylor which he defines culture as. BMW has managed to create a high efficiency culture with . These six countries are Austria. and Germany. Many of these countries have very different cultures. in this case Bavarian Motor Works (BMW). that complex whole which includes knowledge. and other capabilities acquired by man as a member of society (Hill 89).Page. belief. as a corporation and as a multinational enterprise. BMW. art. They have seventeen production facilities. custom.

these are the society s values. sustainability. Each employee is part of the organization. A second principle is peak performance. BMW employees are considered part of a team. it is the customers who determine the success of the company. society. BMW looks for effective results and production. If one employee slacks off then it affects the entire company. Like all other companies who provide a product. exemplary function. Adaptability is . they need to have a high team spirit. This is why BMW builds their company around their customers. respect trust and fairness. high efficiency. It is a norm for everyone in the company to work to their best potential.Page. to offer even better products . BMW is able to be highly efficient. disagreement. The following principles of the BMW Group form the basis of this long-term and target-oriented action. While the employees of BMW can be considered a society. employees. The first principle is customer orientation. That s why each employee has a personal responsibility to make the company successful. to constantly incite each other to become even better. The vision of BMW is to become the world s leading provider of premium products and premium services for individual mobility (bmwgroup. and independence (bmwgroup. Next comes effectiveness. Another principle is responsibility. responsibility. effectiveness. 15 their goal being.com). adaptability. These twelve basic principles are customer orientation. With this mindset from the employees. In order for this team to succeed. It is this team that gives BMW the reputation associated with them. If something is not working as effective as possible management will look to improve it.com).

trust. This belief in respect. That s why the employees hold such a high responsibility to succeed. trust. the longer they drag out the worse they get. This is why BMW wants its employees to be upfront and bring any disagreements to management who can hopefully resolve the argument and send the workers back to work. BMW also has a strong belief in respect. Every employee is expected to treat each other fairly and with respect.Page. companies have to be able to adapt. and fairness allows for employees to work with confidence and to their full potential to create the best product possible. then fairness should follow. a company is only as good as its employees are. BMW takes this as a chance to create and then implement their new technologies into production vehicles. BMW does this by making vehicles that are considered some of the best in the world. Like the BMW website says. An argument in any company is never a good thing. 16 also very important to BMW. If a company is economically successful. then it must be making a strong product that is desired by consumers. Each employee is expected to lead by example. With recent breakthroughs in technology. If this is done. This belief ranges from the CEO to the employees on the assembly lines. BMW also allows and looks to resolve dissent once it is brought up. . like BMW will be a successful company. Like any argument. or stay ahead of change. The company also strives for sustainability. and fairness. With dissent. A company that is able to adapt to change. In this case they want the company to be successful economically.

These twelve basic principles are the guidelines. BMW has had a steady . 17 The final two basic principles of BMW are Society and Independence. the employees voluntarily accept the BMW culture. BMW not only survives. It is a culture pushes the employees to exceed and respects them as well. The way that BMW stays independent is through sustainable and profitable growth. While BMW is a company that has had great success in democracies. BMW is the company who buys other companies instead of being bought out. Whether it is in Germany. BWM is committed to focus on its social responsibility. or South Africa. This social responsibility is for BMW s employees. It does this in all different types of political systems. Instead. and everyone else that is affected by the decisions of BMW. which support individualism. BMW continues to fill a large part of the vehicle segment worldwide. This corporate and employee culture are not just for one location. These guidelines create a culture that is highly efficient and very successful. they are followed internationally wherever the company is located. which BMW functions under.Page. In market and mixed economies. America. it can also succeed in totalitarian countries where socialism and collectivism are practiced. Independence is something that is very important to BMW. these basic principles are uniform and being enforced to make sure that BMW continues to succeed. it grows. consumers. The high efficient culture that BMW has created allows BMWs to be found in all different types of economies. While the different countries that BMW enters for business have different cultures.

When the 7 series sedan is added to this number. about seventy three percent of all BMWs sold in china are sedans. and build something special. First off is its highly efficient culture. Also according to the IIHS. They are simply not safe enough and do not pass these product safety laws. According to the Insurance Institute for Highway Safety (IIHS). This plant specializes in production of the 3 and 5 series for the local Chinese market. all BMWs received a rating of good. The company is really starting to make pushes in countries with command economies like China. As an independent corporation. These two sedans alone make up for over fifty five percent of the BMWs sold in China. China has a market for large sedans. Quality of work like this can be related back to the twelve principles that are the guidelines BMW employees follow.Page.bmwgroup. This is different compared to Europe where narrow streets and high gas taxes cause a larger demand for small more fuel-efficient vehicles (www. it is in control of its own destiny and able to make its own . While some companies often look at product safety laws as an inconvenience. Next is the fact that BMW is owned by itself. The fact that they are built in the country at the Shenyang plant is a plus for the Chinese. First are the strengths of the company. This adds to the BMW reputation where they build vehicles. crash test ratings are a big reason why Chinese vehicles are not allowed in America. which surpass the expectation being legal.com). 18 following and made profit in most of these countries. An important factor in understanding any corporation is SWOT analysis. which was already talked about. BMW often passes these with flying colors. as well as many other countries.

There are many people and families that are enthusiast and will only purchase BMWs. Another strength is that it has a strong brand loyalty. since BMW is found all over the world. Mini. This is slowly changing though as oil prices steadily increase. Another problem is the repair price. BMW is also found in every corner of the populated globe. While BMW controls itself. BMW only puts the best parts in their vehicle so it is a tradeoff that owners have to accept. While strength of BMW is loyalty. these cars are all relatively expensive. While BMW has lots of strengths. BWM has the possibility to further spread its brand. While BMW controls itself.Page. parts are not cheap. These are two companies which are somewhat specialized yet still profitable. less powerful yet more fuel-efficient engines are offered while in America the engines are more powerful and less fuel-efficient. it is very possible that that customer will go to a competitor. it also controls other companies such as MINI and Rolls-Royce. If a customer has a bad experience with a vehicle or an employee. Only the base Mini Cooper is available fewer than twenty thousand dollars. and Rolls-Royce. especially in the American market. If something goes wrong with a vehicle. 19 decisions (Dharmesh). like many other companies it also has some weaknesses. This large market makes BMW a known competitor to everyone. in Europe. With the new trend of globalization. it specializes production to best fit the culture of a certain area. For instance. While the Rolls-Royce brand reaches well above a couple hundred thousand dollars. Finally. BMW has many opportunities ahead of itself. Shipping cost are . a weakness is customer dissatisfaction.

Page. many countries are developing new standard such as America s new Corporate Average Fuel Economy. prices of crude oil and gasoline are both on the rise. All of these are opportunities for BMW to expand and grow. doing a lot of research in order to stay on top of emerging technology. One threat BMW faces is competition. BMW has pretty much perfected their diesel engine. These competitors are. setting the standard for new hybrid engines. While BMW does have to adapt to different laws and regulations in different countries. These CAFÉ standards require fleets of cars to achieve an average pre determined fuel economy (NHSTA. The market. and well be coming out with it soon. This causes people to drive less and buy more eco friendly vehicles and BMW has yet to releases they hybrid models. like BMW. BMW is a multinational corporation that spans all around the world. With oil prices on the rise. They have an opportunity to continue to influence China Also. is very competitive with competitors such as MercedesBenz and Audi. While every country has a different culture. BMW has a culture of its own which it brings with it wherever it goes. or CAFÉ standards. BMW could fall behind the trend. Threats occur in all companies and the way in which companies handle these threats determines their success. Oil is also another threat to BMW. they have developed a functional hydrogen fuel cell. it brings an internal culture with it that people are . new alternative energies are coming out and BMW is not going to let any of these pass them by. With more concerns about the possibility of an oil shortage.com). 20 going down and allowing more BMWs to be in more places. which BMW is in. If these threats are not taken seriously and constantly watched.

NHSTA. BMW. 2005.bmwgroup." BMW Group. Web. As BMW says itself. "CAFE overview.justauto. April 2005. experiences and interests (bmwgroup. "BMW in China. life situations.html&source=overview>. which make it highly efficient and very successful wherever it goes. <http://www. 04/23/1989./0_0_www_bmw group_com/home/home. or norms." google docs. 29 Apr 2010.. "BMW Company AG: 2005 Company Profile.com. <http://docs.html?. Web.Page. 21 willing to adapt to.com/store/samples/aroq_bmw_profile_2005ed1.com) Works Cited (Kris) "BMW Group." NHSTA. this task is handled by employees who have a deep understanding of this diversity thanks to their own biographies. Ideally.com/viewer?a=v&q=cache:3Yw_3nvGhgwJ:ww . we can only tap into the full potential of international business if we understand different customer groups. cultures and requirements. It is very rare to see an international business have such a uniform culture in different locations.pdf>.google. <http://www..gov. 29 Apr 2010. Joys of BMW. 29 Apr 2010.gov/CARS/rules/CAFE/overview." Just-auto. Aroq ltd.nhtsa. 29 Apr 2010. Web. Today we are active in more than 140 markets worldwide.com/e/nav/index. <http://www. However. Web.htm>. BMW and its internal culture follow twelve basic principles.

"Marketing Strategies BMW.slideshare. Web.p. N.Page.scientificaward. ." Slide Share.net/thats4u83/b-mw-assignment>. <http://www. 22 w. Dharmesh. .com/e/0_0_www_bmwgroup_com/investor_rela tions/ir_services/BMW_in_CHINA. 08/02/2007. 29 Apr 2010.pdf+bmw+plant+%22greenfield %22&hl=en&gl=us&pid=bl&srcid=ADGEEShRAHeXpINj0A_QTsxMB KSWV6pUxW7xrbNm4mMh313RSuw_ntfgxfmy5gN4JWLKxe6W_1k Yb_GZXvTrXpjxLUMgNtTalJuZKOal5pGR2Yajy0KTbmuq8LZ0Z83KSB2mCsFOnql&sig=AHIEtbThZVYYlFfR9Pjc63J8jzIDDZVqg>..

Honda. For years BMW held a small market to which they sold cars.Page. and MG brands. ." (www. From research and development to sales and marketing. Land Rover. They needed to spread out across the market and expand upon their product base. which would compete with Ford. the BMW Group has its sights set firmly on the premium sector of the international automobile market.bmwgroup. To achieve its aims. The company's success to date is proof of this strategy's correctness. which consisted of Rover. BMW Group is committed to the very highest in quality for all its products and services. They had to make the right decision on how to expand their product line but carefully.com) Acquisitions BMW bought the British Rover Group in 1994. 23 Micah Edmond Marketing "With the three brands. BMW had to be extremely careful when doing this because they could easily destroy their very successful image. the company knows how to deploy its strengths with an efficiency that is unmatched in the automotive industry. MINI and Rolls-Royce Motor Cars. Toyota. which needed to be changed. if they created a more inexpensive line of cars. BMW.

which could have been profitable for the company.Page. When Fiat created the Croma they focused it as an executive car but it did not do very well on the market. BMW held a spot at the premium level and the exclusive level with Rolls Royce. BMW looked into developing a new brand. While BMW were researching and planning their possible routes for expansion into the market an option took place where they were able to look at Rover. The only times when large car companies were able to be successful in multiple market areas was when they used multiple brands. There were only two options for BMW to expand. when they came to BMW searching for a supplier that could produce diesel engines. with a lower end going up to a higher end. The Volkswagen group was able to achieve this going from their lower end brand Skoda. to their middle class that consisted of Volkswagen up to their higher class Audi. At the time British Aerospace owned the Rover Group and were also searching for an exit from the company due to differing interests with the . Brands such as Toyota and Nissan were successful with their additions of their luxury creations Lexus and Infiniti. this was to either purchase an already existing brand or to completely create a new brand. which did extremely well. 24 Volkswagen and Fiat it would unquestionably decrease the value of the BMW brand. topping it off with their exclusive brand Bentley. at the same time Fiat released their budget supermini car the Uno. Rover was planning their next addition the now extremely popular Range Rover. Many car companies in the past have failed miserably trying to connect the extremely large gap between small budget vehicles and premium luxury vehicles.

Page. 25 companies focus on airplane design and manufacturing as well as defense. BMW s tactics at the international helped them setback a possible competitor from entering a market in another country. BMW was not the only company that had its eye on Rover. which would have helped Honda enter this market. With BMW breaking the tie between Honda and Rover.co. BMW retained the Rover. After five years of BMW owning Rover they only released one new car. Volkswagen.uk) BMW s choice to purchase the Rover Group was an exceedingly smart move that benefited the company in the long run. (www. owning 20% of the company.aronline. The one problem among the transaction was Honda s partnership. BMW closed the majority of Rover s dealerships as well. The possibilities of overlap between the two manufacturers were little to none. On the other hand Rover owned 20% of Honda s United Kingdom manufacturing facilities. was very interested in the company. a competitor of theirs. the Rover 75. resulting in a trade of ownerships. they were able to delay the possible competitor from having a big influence on the European market.co. Rover fit BMW s premium image and outstanding quality like the missing piece to a puzzle.aronline. (www.uk) BMW soon sold the Rover Group to Ford but was very smart in their moves along the way. Rover could have become Britain s goto brand for a premium vehicle. This made it important for BMW to seize the company before Volkswagen was able to. Honda was not comfortable being partners with their competitor BMW. While BMW owned Rover they only invested in certain areas of which they retained after the deal was done. . Triumph.

" (www. Both of these lines targeted towards exceptionally wealthy families and people who are looking to be "highly individualistic. 3. Z4. X. M. and facilities. which they kept and later used on their X5 model. These four controllable categories are product. Cowley and Swindon. 6. The 1 series is geared towards the middle class and is BMW s new less expensive model. The Four P s The four P s have a huge impact on how BMW makes their marketing decisions internationally. during ownership of which they retained when they sold the company.com) BMW currently has nine series of cars which include the. 5. price and place. the Ghost and the Phantom. BMW invested into multiple of the Rover plants. 7. which is the physical product that is being sold. and Hybrid. The Z4. BMW at their mid sized premium level and MINI as their smaller car premium level.Page. which is pushed toward individuals who want a premium car but do not need a large sedan. BMW though did not sell the rights to the 4x4 to Ford. 1.rollsroycemotorcars. The first of the four P s is product. M and 6 series is geared toward a businessperson who is looking for incredible BMW performance as well as . and MINI brands. BMW offers three levels of premium vehicles. they offer Rolls-Royce at their exclusive level. Longbridge and Hamms Hall. The 3 series is BMW s compact executive car. promotion. 26 Riley. Rolls-Royce is currently producing two lines. The 5 series is BMW s mid-size executive car that is for businessperson who also has a family or wants more space.

MINI is for individuals that looking for a premium level vehicle but fell that BMW is too expensive.bmwusa. The 7 series is BMW s full size luxury car that is focused towards people looking for effortless luxury and tremendous power. In the United States.Page. 27 modern style. Cooper S. There are many factors that affect BMW Group s decision with choosing the price of a vehicle.com) BMW also offers multiple lines of Hybrids.bmwgroup. (www." (www.000. In Europe MINI is very popular because of small streets and the car is easy to drive on these streets.000 to $34. Cooper Clubman and the John Cooper Works. the product line of Rolls Royce ranges from $245. The MINI product line ranges from $17. Along with their multiple brands and product lines. MINI currently entails. BMW s X series is focused towards wealthy families.000 to $450. Sports versions of their vehicles that contain performance enhanced specifications and different sized engines also influence prices. Cooper.000 dollars.000 to $137. which is focused towards more environmentally savvy individuals. The third P is Placement. which is based on how BMW makes their vehicles available to the targeted customers. BMW s product line ranges from $27. generally focused toward a wealthy businessperson. they provide premium customer service. BMW only distribute their first-class vehicles .com) The price section of the four P's of marketing is different depending on which country you live in. directly mothers who are "socially conscious. MINI is more of a city car that is geared to people who do not need space but are family oriented and active. Each of the companies has cars that are focused to certain target markets. which vary internationally.000.

(p.Page. he explains that cultural differences between nations are such that a message that works in one nation can fail miserably in another. Promotion is one of the most important factors when dealing with a business internationally. 607) For example an advertisement created by BMW could possibly work with the German culture but be insignificant to people in the United States. BMW s slogan though works equally well throughout the world. The last of the 4 P s of marketing is promotion. 28 through premium dealerships with BMW and MINI.com) When visiting the BMW websites for both Germany and United States the home pages are similar yet they way they present the information is different. Making the vehicles exclusive gives their company an advantage in preserving their premium status throughout the world. What is different about the two websites is the central . Cultural diversity makes it extremely difficult to develop a single advertising theme that is effective worldwide.bmwblog. Hill. The Ultimate Driving Machine is straightforward and can relate to any customer throughout the world that is looking for a premium car with exceptional quality.L. One advertisement would not meet the needs of the different cultures of different countries. In our textbook International Business: Competing in the Global Marketspace by Charles W. which is The Ultimate Driving Machine that was created thirty-five years ago. BMW has to use different advertisements for selling their premium cars in different countries throughout the entire world. (www. When visiting both websites the navigation section are the same as they are at the bottom of the page.

Each of these four pictures give a statement about their new ad campaign "Joy Is " The website describes their new BMW 3 series Cabrio as "Joy is Always in Season. . the main attraction. After the site automatically moves onto the next section it presents their campaign "Build Your Own." When you arrive at the United States BMW website you are greeted with a short movie clip and music. Joy is BMW Active Hybrid." This attracts the United States population s ongoing obsession for everything to be customizable. On the German BMW website there are four pictures that you can scroll through. 29 advertisement in the middle of the page." and their new hybrids as "Joy is Efficiency of Movement. Through these short ten-minute film series named. The German site is more straightforward and geared towards giving the consumer an exceptionally premium car with guaranteed quality. Which is exactly what BMW does with this new campaign they are able to draw in Americans to make a car of their own. The website then explains the same ad campaign as in Germany but more flashy. These high tech and gaudy advertisements work well with their target market in the United States. Push and Pull Strategy BMW Films was BMW s form of advertainment which is a mesh of advertising and entertainment.Page. It explains how each of their cars has "hundreds of millions of possibilities" as to how to customize a BMW to make it your own. The only way to catch the eye of a potential customer is to have an ad campaign that will draw them in to see what you have to provide. and no one else in the world will have the exact same car.

The films demonstrated the high level of performance and the premium quality that their vehicles contain. Mexican. Taiwanese. "The main decision with regard to communications strategy is the choose between a push strategy and a pull strategy.com/Standard/Content/Uniquely/TVAndNewMedia/BMWFi lms. Individuals who watch would become potential customers who would be attracted to BMW's cars. BMW was able to connect these films with multiple cultures throughout the world by using various filmmakers from throughout the world.aspx) These short films highlight performance aspects of multiple BMW cars. In these films actor Clive Owen is The Driver who is hired by various people to be a sort of transport for their vital needs. BMW was able to promote their premium cars. The nationalities of the directors featured American. A push strategy emphasizes personal selling rather than mass media advertising in the promotional mix While "a pull strategy depends more on mass media advertising to communicate the marketing message to potential customers. which were featured in each of the films. 604. This diverse group of directors allows BMW to connect with different cultures throughout the world.bmwusa." (p. 30 The Hire. Charles Hill) When BMW created their short film series The Hire it was a distinct move in the way of a pull strategy. (http://www.Page. . though the real stars were the premium BMW vehicles. Chinese. and British.

bmwusa. Web.com>. L. 02 May 2010. 01 May 2010. Boston: McGraw-Hill/Irwin. Print.com>.bmwgroup. BMW Reviews.com/Standard/Content/Uniquely/TVAndNewMedia/ BMWFilms. Web. "BMW Films. 7th ed.aronline. <http://www. 2009. International Business: Competing In The Global Marketplace. Hill. 02 May 2010. . BMW Group. <http://www. <http://www. <http://www. 606-07. BMW North America. Web. Web. .co. Web. 02 May 2010. Web.com>. BMW BLOG | BMW News. Rolls-Royce Motor Cars.com>. 02 May 2010.aspx>. Charles W. 02 May 2010. <http://www.Page.bmwusa." BMW North America. 31 Works Cited (Micah) Austin Rover Online. <http://www.rollsroycemotorcars.bmwblog.uk>.

The earnings for BMW Group are broken down into three categories.8%) lower than the 2008 third-quarter report. 32 Travis Harrant Financial Analysis The Bayerische Motoren WerkeAktiengesellschaft (BMW) Company uses both International Financial Reporting Standards (IFRS) and the German Commercial Code (HGB) for accounting policies and procedures. and financial services. They enable the overall group of company s outlook as opposed to one company s stand alone position. The BMW Group uses consolidated financial statements to report the company s financial position and its subsidiaries.Page. motorcycles. In this financial analysis I will be using the third quarterly report and the annual report 2009 for the BMW Company. Under the current rate method.automobiles. Both accounting procedures are valid under the International Accounting Standards (IAS). A consolidated financial statement combines the separate financial statements of two or more companies to yield a single set of financial statements as if the individual companies were really one (Hill 661). This was euro 220 million (73. The automotive segment is the company s . The third-quarter reported a net profit of euro 78 million for BMW Group. BMW Group uses the current rate method to determine the exchange rate. the exchange rate at the balance sheet date is used to translate the financial statements of a foreign subsidiary into the home currency of the multinational firm (Hill 664).

5 million units in 2009. Both countries contracted by almost one-half. In the European Union the demand decreased around two percent.Page. which was also beneficial to the financial services sector (16 Quarterly Report). The motorcycle segment was reduced by one third from the 2008 year.2 million units in 2008 to 62. The motorcycle and financial markets were also hurt from the worldwide economic crisis. sales dropped 40.9%. with the motorcycle segment making the least amount of revenue. BMW suffered losses from all regions. decreased from 66. the car market was not affected by the economic crisis. Spain and Russia suffered the most from the economic crisis. The financial services place second. within the whole company. the largest market for motorcycles. . even with the bonus program. Governments started to reduce interest rates to help compensate the recession. 18%. In particular. they ensured the supply of liquidity to international money and capital markets. Because of the economic crisis worldwide. based on the third quarter. The bonus program in France helped boost sales eleven percent. In the USA. India had the biggest increase. 33 largest revenue maker. In Brazil. It grew by 9% because of the tax reduction for small cars. cash for clunkers (Annual Report). The automotive segment. The USA suffered about a three percent loss. This helped the BMW financial services sector with a profit of euro 94 million. The financial services were also hurting because of the international financial crisis.

Investing activities. plant and equipment and other intangible assets.7 million.8 million from the previous year. the dividend payment totaled euro 197 million. slightly decreased. investments elsewhere in the world. Financing activities also decreased from the previous year. BMW uses the Germany stock index. The common stock for BMW.2 million to euro 3.3 million in property. Cash flows are the basis for dividends to stockholders. for cash inflows.3 million from the 2008 year.2 million.16 points on the last trading day for the quarter.675. repayment of worldwide corporate debt. BMW generated a positive cash flow of euro 10.7 percent from 2008. was . investing. This was decreased euro 5. Cash flows are classified into operating. The automotive segment only increased by 3. The index has gained 8. euro 2. and financing activities.9% for the quarter. The 2009 third quarter closed at 5. For 2009. In 2009. The total cash inflow also dictates the stockholders dividend payment. The development costs rose 1.3% in value since the beginning of the year (14 3rd QTR Report). a 5. This was 18% higher than the previous quarter. 34 Capital budgeting for BMW Group decreased from euro 4. Investing activities fell euro 7. automotive segment. The overall cash outflow decreased from the previous year. The operating cash outflow. the DAX.5 percent decrease from 2008. BMW invested euro 2.1 million.Page. increased euro 1. In 2009. at the end of the 3rd quarter.3 million from 2008. and so on (Hill 678). The main focus for BMW was product investment on new model set-ups and infrastructure investments.

1% of its value since the previous quarter. increased 22.95.46 to the euro.finance.42 from the previous day. has increased from the third quarter report.08.814. The market value cap was euro 22. The current stock information. the dividend increased euro .5% decrease for the closing rate.28-37.25 to the euro.yahoo.96.Page.73.79 percent increase.85.37. At the end of the 3rd quarter. The BMW Group joined the Carbon Disclosure Leadership Index in September 2009. At the closing time. This index applied to companies in the Global 500 index that make a contribution to the climate protection. 35 euro 32.40. The preferred stock increased 32. At the end of the quarter.DE) .com/q?s=BMW. This was down euro . The 52 week range was euro 28. (http://uk.6% for the quarter. Because of the USA growing deficit.38.164. The asking price was euro 37. This means that the BMW Group has been the most sustainable car manufacturer in the world for the fifth time in succession (04 Annual Report). The US dollar has lost 4.53 billion. The opening bid was euro 37. The last trade value was euro 37. BMW was the industry leader in the Dow Jones Sustainability Index.30 and yielded a . The bidding price was at euro 37. the value of preferred stock was euro 22. The day s range was euro 37. it was valued at US dollar 1. This caused a 4.40. as of 4/27/10. In 2009. In the beginning of the year the US dollar was valued at 1.8% from last quarter numbers.85. the US Reserve Bank had lowered the interest policy causing the US dollar to lose value. The volume value was euro 2.

The BMW Group uses the euro for reporting financial statements. Spain came in last with 3. The USA market has to use the exchange rate to compute the earnings in the euro. Italy. In the automotive market. and Other. The differences in the country s currencies value can let the company lose operating activities. a market for converting the currency of one country into that of another country (Hill 324). the overall value can be worth more or less than each other. United Kingdom. In the USA. -20. the units of volume fell 242.053. the net sales volume decreased across the whole company. The BMW Group automotive segment sales volume is broken down into eight markets. The reason behind this is because the company manufactures in one country and then sells in another country. As noted above. compared to USA. Canada. the rate at which one currency is converted into another (Hill 324).8 percent. surpassed their previous year s sales volume by 2. The exchange rate is defined as.3 percent.8 percent.Germany. The Germany market was the largest sales volume at 20. USA. The European market was hit hard by the global recession crisis.2 percent. Spain. France.9% from the . The USA market came in second at 18. the results differ from the previously reported amount. Because the currencies of different countries have different values compared to each other.9 percent. Sale volume was down 11. China. the exchange rate does not affect the BMW Group s financial worksheets.Page. Because the exchange rate is always changing. 36 Foreign exchange market is. In some cases this makes it hard for the company to compare the actual amount from quarter to quarter.

The European market only sold 761. 37 previous year.com/q?s=BMW. was 1. in 1. Asia reported a 10.3 units.5 units. The Chinese markets reported an overall increase of 31.3 units. reported a volume of 267.286.finance.5 percent increase.000 units.539 units. the Asia and Chinese markets increased. came in third with 267. 2009. Print.1 percent.000 units. The United Kingdom was the smallest market with only 137.1 units. 7th ed. L.7 percent decrease. largest in the company.8 percent from 2008 financial year. International Business Competing in the Global Marketplace. Charles W. The total number of automotives delivered by region. The Germany market. The European market totaled. This was down 4.a. was 357. Works Cited (Travis) http://uk. Spain sold 40. .DE) Annual Report Hill. Although the overall market sales volume was decreasing. the largest in the company. The Germany market.718 units.yahoo.: McGraw-Hill/Irwin. causing a 31. in 1.Page. Boston [u.887 units.

a firm must maximize the value for the firm. Norbert Reithofer comments.significant when you consider that the group employs close to 100.. its owners and shareholders. and BMW has emerged leaner from the experience with a focus on cost reduction. design and ecological innovations. engages in industry-level strategizing. 38 Herbert Bowen Current Challenges and Solutions A strategy can be defined as the actions a manager takes to attain the goals of the firm.. of course.000 employees. Then the company slashed capital expenditure by almost 800 million Euros and maximized on its financial services segment (2). Since. a global company progresses to the stage of formulating and implementing strategies at the international level (1). To view some of these goals and missions that BMW has let s take a look at Dr. . in order to adhere to the guidelines of the foreign company at hand. That the company has emerged leaner is a result of a reduction of about 4% of its workforce . a keen eye on the growth markets of tomorrow. the pertinent aspect is the firm. it analyzes global trends in the automobile industry and then positions itself in relation to its competition (1). At the industry level. and.Page. 2009 was unequivocally a year of challenge for the entire automotive segment. Now you must adapt and mutate the company strategy. What exactly do I mean by this? BMW. Managers and firms alike must seek strategies that increase profitability of the enterprise and rate of profit growth over time.

(In fact. Learning effects refer to the cost savings that come from learning by doing. one can derive four components that appear to be the focus of BMW. where cuts of . Mergers The merger was a signed agreement to build cars and share components. the alliance between BMW and Fiat. they slashed capital expenditure by 800 million. ecological innovations.Page. gains efficiency and effectiveness. all ways to cope with and war against the tumultuous economy. (engines. This entry for BMW into the mini brand of cars would be a vehicle that is cute. labor. design. and preparing for growth markets of tomorrow. We are examining with the Fiat Group possibilities of joint use of components and systems in Mini and Alfa Romeo vehicles. but not a luxurious (2). for instance. Board member Friedrich Eichner. they are producing a better. due to the managers and firms learning new and efficient ways to increase revenue and cut down on operation. as they are ameliorated.000 employees.000 employees being laid off. in order to achieve economies of scale and thus cost reductions (2). know-how. which employs 100.000 equals 4. 39 In his comments. Through cost reductions BMW has become leaner by reducing 4% of its workforce. Mini s are produced at the . In addition. over time. cost reduction. especially when it comes to small cars). revamped economy of scale. For example. BMW was able to become leaner due to learning effects and economies of scale.04%*100. Thus. Moreover.

such as parsimonious consumers in main markets. But what plagued them in the past. and rising financing costs. S. Fixed costs are the costs required to set up a production facility.2 percent.793 vehicles. Automation and Motion Division. or in other words the international financial crisis. BMW had additional setbacks. two years ago in 2008 was the economic slowdown. Oxford. Therefore.C. Along with the financial crisis. MINI and Rolls-Royce cars between July and September. a fall of 4. as Siemen s delivered turn-key automated conveyor and end-of-line testing systems for BMW s new assembly North Facility in Spartanburg.098 of its BMW. What is illustrated are two companies combining resources to propel BMW to new heights and eventually industry leader. said Raj Batra.6 billion. as third quarter sales fell by 8. lagging used car markets affecting leasing operations. BMW had to cut 40. The group sold 349. develop a new product. We are pleased to begin these latest projects and look forward to growing along with the Spartanburg facility.276. beating the previous . BMW and Siemen s Energy and Automation aligned together. while net profit plunged by 63 percent to 298 million. (11). Compared to 2007 BMW reached sales of 1. and the like (Hill.6 percent to 12.) Examining further economies of scale refers to the lowering of a firm s unit costs and the increases in its profitability. Siemens Energy & Automation (11). 40 BMW in Cowley.Page. BMW s history of production and factory innovations has been a good match with Siemens technologies and services. 430). vice president.000 of additional units in 2008.

skills difficult . Those figures are presented to display why BMW finds it necessary to administer and acquire outside sources like Siemen s to further their technologies and find ways to cut costs. Next. perhaps in operations. and location economies.088) by 7. Another technique thought by Siemens is the TIA platform (Totally Integrated Automation). Siemens has implemented a technique called PROFINET. increased by 18. 41 year's level of (1. BMW s actions and goals perfectly align with the globalization strategy. asserting Rolls-Royce as tops in the super luxury car market (10). high-performance communications and consistent data management.185. based on a three-fold integration of uniform engineering. the international open industrial Ethernet standard for automation. as 2006 sales of 805. would be sharing the fixed costs through R&D. Over time Rolls Royce has seen figures rise four times in a row.5%.7%. hence easy entry. Third. Advantages of alliances dictate four aspects: strategic alliances to proliferate into a foreign market. where focus is on increasing profitability and growth.5% to 222. learning effects. placing annual sales into the four-digit range for the first time.077). MINI in comparison with the previous year of (188.Page. while reducing costs from economies of scale. This enables users to easily expand existing operations or build new lines without having to overhaul the entire automation system (11). Globalization Strategy Thus. Rolls-Royce Motor Cars increased by 25. rose to 1010 cars.875 units sold to customers.

Strategic Alliance The alliance not only aids BMW. parts and technology will be put into the Megacity vehicle. sustainable mobility. The US has invested $100 million with 80 local . Finally. 42 to develop by one firm should be complementary to the other. providing a name coupled with high-class. and quality performance (6). BMW wants to lower emissions of carbon per kilometer travelled. an alliance should push technological innovation to leap ahead of competition. Once again. BMW wants to put a standardized image. For about four decades BMW has made itself known to have efficient dynamics. and in the modern era focusing on ecological innovation is where governments and automakers alike are investing their dollars.Page. in this case Mercedes. To uphold this moniker one must transmute with the times. The proposed cooperation with BMW is a significant cornerstone of our strategy of alliances. With this strategy. Fiat CEO Sergio Marchionne. one that will be noticed worldwide. but also garner more profits. but Fiat the largest Italian automaker. a company based in Seattle Washington. Along with ecological standards BMW has formed with SGL. which is a BMW sub-brand. and Honda. Toyota. economies of scale are kept in mind to produce carbon fiber reinforced plastics at volumes and prices realistic for mass production (5). We are delighted to work with such an esteemed and respected partner in the automotive industry with the clear objective of improving the competitive position of both parties (3).

and Japanese makers of high-end automobiles. and desire a luxury car. to foster lightweight cars reducing CO2 emissions and ameliorate fuel storage. BMW not only is becoming more eco-friendly. But its most notable feature is the creation of energy by hydropower. the Moses Lake plant hopes to recycle all the carbon material.S. a plant located in Moses Lake uses carbon fibers for large scale production in the automotive industry. to make light weight cars. said Robert Koehler. but innovative with the new technology in carbon fiber. friendlier for the environment. to remain eco-friendly. now the Megacity Vehicle powered by electricity has a base in the USA. With dedication to ecological standards. Why? In China there are more drivers who are starting to drive. European.000 to 100. The fourth component speaks towards the growth of future markets. If we look at BMW s recent advancements in China. we see investments of a billion dollars to increase production. So. For 2010.. BMW s operations went from 40.000 units. . China is becoming a hotbed for competition. China is boasting staggering sales and manufacturers are creating enticing bells and whistle for Chinese buyers. CEO SGL Group. For example. the Mini E s body will be fabricated in the Moses Lake plant. 43 jobs that would be created. In addition.Page. Additionally. It will be the world s most cost efficient carbon fiber plant using state-of-the-art technologies (7). The new rich have made China an integral asset for the market of luxury goods makers in the U. This effort is by works of their Efficient Dynamics strategy.

a 33 percent increase from last year and 20 percent more than a previous projection. and was up 14 percent. "The growth in China doesn't come for free. In addition. the Audi A6L is favored by government officials.K. in the super luxury end Rolls Royce s revenue has increased significantly as they have had to hire more workers in producing the vehicle to meet Chinese demand. 44 Currently." CEO Torsten Mueller-Oetvoes (8). and improving economies of scale. But. a mountainous southwest city that holds private gatherings for buyers who want to share their enthusiasm for cars. but may be needed in long term..000 vehicles a year would depend on market trends. he said at the Beijing auto show.000 vehicles a year from 2012 on. Their goals of cost . propounding BMW s name across the globe. You have to invest and it will come" (8). I see China will even overtake the U. We are currently exploring this possibility together with the authorities here in China . new innovation in design and operation systems. Reithofer continued (7).. The X1 is manufactured exclusively in Leipzig at present. In fact Rolls Royce has set up dealerships in Chengdu.Page. and Rolls-Royce vehicles in China in 2010. Moreover.S. this year and that we will see the Chinese market as the second-most-important market after the U. This quote speaks to BMW s intent.000 BMW. as they plan to deliver 120. The BMW X1 could be one of the first products for our new plant in Tiexi in the Shenyang region. thought and construction of two plants with combined potential for as many as 300. BMW alliances focus on ecological concerns. our home market. In essence. prescience into future markets. Mini. Tiexi would increase production capacity in China to 100.

21 Apr. the source of all the luxury car activity is China. to maintain the pulchritude of the Earth s landscape. India Business News.Project Management. Toyota all are competing to become top seller in China. We see this from the Megacity Vehicle powered by electricity. Live Stock Quotes." BloombergUTV: Latest Business News.html>.Page. Latest India News. 2010. <http://www. Lull. 21 Apr. BMW is emerging as the industry leader. BMW. "Corporate Strategy and Intercultural Management ..com/industrynews/automobile-industry-india/47499/bmw-s-2010-strategy. and cleaner emissions. also. Pavan. 2010. Works Cited (Herb) 1. <http://www.bloombergutv. .Project Management. Economies of scale are paramount as the alliances between Fiat. Audi. and the SGL GROUP all allow BMW to lower their fixed cost and increase profitability. Mercedes.BloombergUTV. but with demand rising steadily in China. 2010.html>." Super Business . the carbon from the Moses Lake plant that will be recycled after use. Finally. With the boom of opulent persons in China. due to Rolls Royce and the success of the brand. "BMW's 2010 Strategy.net/intercultural-management/308.com. 45 reduction are realized through the skimming of jobs in the United State sector. 2. 19 Mar.super-business. .. BMW can transport jobs. Siemens. However. Web. Modern times and regulations call for more miles to the gallon. Financial News and World Business News. Stock Market News. Web.

motorauthority. 21 Apr.Page. Web.co. Web.com | Always Branding. 9 July 2008. "Fiat/ BMW Alliance. Web. "BMW Joins Forces With Carbon Fiber Manufacturer For Megacity Vehicle . Car Reviews. Web. "BBC NEWS | Business | BMW and Fiat Mull Parts Alliance. "The Associated Press: Rich Chinese Driving Growth of Luxury Auto Market.com | Brandchannel. Spy Shots and Videos . <http://brandchannel.MotorAuthority. 2010. Web.pistonheads. 21 Apr. Web.html?http://www." Car News. <http://news. Anita. "HTC | Electronics Brands | Brandchannel. 2010. 21 Apr. <http://www. Always On.bmwgroup." PistonHeads. 7. 21 Apr.google. 2010. Ireson.bbc. .com/tvr/default." Brandchannel. 2010.com :: Speed Matters.html>.stm>.asp?pr_id171>. BMW Group. <http://www. Chang. 6.MotorAuthority. 4. 8 July 2010.uk/2/hi/business/7496105. 21 Apr.co m/e/0_0_www_bmwgroup_com/investor_relations/corporate_news/news/ 2010/Carbonfaserwerk_April_2010.com/features_profile. 21 Apr. <http://www. Nelson.com/blog/1037455_bmw-joins-forces-withcarbon-fiber-manufacturer-for-megacity-vehicle>. 2010. 5." Google." BBC NEWS | News Front Page. <http://www.com.bmwgroup. 2010.asp?storyId=18347>. 46 3.com/hostednews/ap/article/ALeqM5h8LHDpLSjL1L9n TijACbBn-51YdAD9FBSD600>. 8.com/e/nav/index.

"BMW Posts Hefty Quarterly Loss . 21 Apr. . Print. Instrumentation Resources.automation. 2010. Web. Web.huliq. Charles W. 7th ed. Krause.Industrial Automation.com .Page. <http://www." HULIQ | Citizen News Review.2 Percent | HULIQ.de/money/2008110415309.: McGraw-Hill/Irwin.html>. 47 9.com/47346/bmw-group-increases-2007-sales-9-2percent>.Germany's News in English." The Local . 2009. L.a. 11. Factory & Process Automation. <http://www. 2010. International Business Competing in the Global Marketplace.thelocal. Motion Control. 21 May 2010. Stefan. 21 Apr.com/content/siemens-to-deliver-conveyorsystems-and-end-of-line-testing-for-bmw-facility-in-south-carolina>. Boston [u. "Siemens to Deliver Conveyor System for BMW Facility in South Carolina Today's Automation News Headlines from Automation. <http://www. 10. "BMW Group Increases 2007 Sales by 9." Automation. Web.com. Hill.The Local.

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