BMW COMPANY OVERVIEW

Laura Moreira-Andrews
(201001830)
Pat Hale
(201005311)
Anthony Aleong
(201005251)
Justine Lucas
(201006092)
Nick Rankin
(2010)
November 24, 2010
BSAD 101
PROF. GALEA
Executive Summary

In 1913 a company called Bayeriche Motoren Werk began to make military

aircrafts and aircraft engines. BMW expanded to build also build automobiles,
motorcycles. 97 years after they opened shop BMW is in over 100 countries
including its founding country Germany, the United Kingdom, United States, and
Canada. The current CEO of BMW Norbert Reithofer was born in Penzberg, Germany
in 1956. He graduated from the University of Applied Sciences in 1980 and 7 years
later joined BMW as the Head of Maintenance Planning. In 2000 Reithofer was
appointed as the Director of Production. Reithofer wasnt done there, after 6 years
he was named CEO of BMW. The goals of BMW are, Producing outstanding brands
with an unmistakable profile Automobiles and motorcycles which fascinate people
all over the world and which win legions of new admirers every day. BMWs two
main members on the Board of Directors are Ian Robertson who is the Head of Sales
and Marketing and Member of Management Board, and Anton Ruf who holds the
positions of Member of supervisory Board and Director of Product Line. BMW now
has 105, 972 employees around the world.
In summary, the competitors reviewed in this project, Audi and Mercedes are
both fellow German luxury car brands. Audi, a subdivision of Volkswagen Group, was
founded in 19091, and their mission is to make attractive, sophisticated, and
technically perfect automobiles3. Mercedes has a mission to produce vehicles with
quality, performance, and durability. They were founded in 1929 4, and are a
subsidiary of Daimler AG5.
With BMWs high-valued place in the markets, they will always be in the news
for advances and shortcomings. They will, however, always have their sturdy
foundation to fall back on. A first example of this is the short-listing of BMWs
current communications managers, Cundari, after 15 years of service. Cundari was
chosen to stick around due to a sudden price cut, but it does not always turn out
that way. They just recently parted ways with GSD&M Idea City, and
advertising/marketing company.
They are keeping up with any changes in trends and demographics with their
latest idea for production: eco sports car. And on another positive note, at an
estimated few consumption at 3.7 litres of fuel per 100 kilometres, the Federal
Motor Transport Authority in Germany named the BMW/MINI one of the most fuel
efficient first-class brands that one can buy in that market.
Lastly, they have run into a few lawsuits such as the recent blocking of some
sales into Switzerland because of an increase that the Franc had against the euro.
We wont know how this will wind up for a couple years, but one thing is for sure:
BMW will get through it as they always do.
Not only does BMW create cars, but they are world leaders in motorcycle,
marine and aircraft production. They have a long history of providing the best
engineering in the market. It has developed a very well known logo, which everyone
recognizes. The reputation it has is good quality, reliable, luxury cars. The Mini,
Rolls-Royce and BMW are the main three car products that are currently in the
market. But, they are constantly innovating their products to stay ahead of

competitors. Their biggest market is USA. When the recession hit, their market
share in the USA was affected but because they focused on international markets
(like China and India), they were able to increase share in those markets and remain
profitable despite the recession. This year, BMW set up a green tree program in

Beijing, China to show their environmental awareness. They plan to have a

big area which BMW plants trees. Also BMW car owners will be able to donate
money to the China Green Foundation, whoever donates will have a tree
planted in their names.
With BMW, one of the biggest problems is the really high price of the raw
materials. Not only do people invest a lot of money into these luxury cars, but if
something goes wrong then they have to pay more money for the broken parts. Not
only are the prices a lot for the consumers, but the manufacturing costs of these
cars are rising. If you compared to the Subaru, they have 4 wheel drive, four doors,
manual transmissions, 225 or more horsepower engines, and both are very close
with interior and exterior dimensions. But you are paying 60% more for BMW. Also,
in 2010 BMW recalled over 348,000 vehicles due to a leak in the brakes. The leak
could cause serious problems and cause the car not be able to stop.
BMW, with its high revenue level, creates many opportunities to help develop
them even further as a company. BMW, who makes the mini and rolls- Royce models
in addition to its own has increased sales worldwide by 13 percent. Introducing new
automobiles such as the BMW X1 last year has increased the demand for more
comfortable and faster cars. BMWs introduction of diesel powered engines has a
means of phasing in alternative fuel source for their cars. A total of 341,932 BMW, MINI
and Rolls-Royce brand cars were delivered to customers in the period from July to September 2005,
15.4% more than in the third quarter 2004, according to BMW.com

Threats on BMW are New and existing competition, takeover bids, fuel pump
failure and economic recession. Audi is currently leading almost every other car
brand this year in growing sales of 33.3%. In the early 2000, BMW sold Land Rover
to Ford leading to Harry Dunlevy (ex-HR director of BMW) leaving his post as HR
director of BMW. Threats of law suits lead BMW into recalling all models fitted with
the turbocharged 3.0-litre inline-6 engine due to reports of fuel pump failure. Due to
economic recession, BMW is to expect more job cuts and production will slowdown.
BMWs survival will depend entirely on their ability to quickly adapt to slowing sales.

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