e c n a m r o f r e P s ’ W M B f o s i s y l a n A
Abstract
This analysis touches on strengths and weaknesses that the BMW Group (hereinafter called “BMW”) shows in domestic and international operations and on opportunities and threats that BMW faces in both enironments (see !gure ")# The international part $ooms into the operations and the enironment in the %sian area# % short introduction to the company lined with up&to&date facts and !gures is followed by the internal and the e'ternal analyses and the conclusion#
Introduction to BMW BMW is a German car and motorcycle manufacturer headquartered in Munich, Germany and operating in more than 150 countries 1 !t counts as one of Germany’s largest industrial companies "ith total sales of #,11$,%&5 automo'iles in #01(# and 110,)51 people employed ) BMW "as a'le to cele'rate its ( th consecuti*e record year of sales # BMW represents three of the strongest premium 'rands in the automo'ile industry+ BMW, M!!, and -olls.-oyce (/ additionally motorcycles and nancial ser*ices "ere successfully oered 2or #01), the corporation recorded re*enues of 3 $&,054 million and an B!6 of 3 $,%4& million)
Internal Analysis | Strengths BMW aims at oering highest standards in terms of aesthetics, dynamics, technology, and quality 6his is achie*ed 'y the em'edded long.term thin7ing "ithin the company) !n 8eptem'er #01(, BMW "as announced the most sustaina'le company in the automo'iles 9 components industry 'y the :o" ;ones 8ustaina'ility !ndices -e*ie" <:;8!=5 6he follo"ing part "ill "or7 its "ay along Porter’s >alue ?hain &
Primary acti*ities . out'ound logistics and sales 9 mar7eting+ !n order to oer "orld"ide supply, BMW has de*eloped a "orld"ide distri'ution net"or7 ) A special strength of BMW is the nancial ser*ices "hich oers tailored nancing and an a"ard."inning customer ser*ice$,4 BMW’s oer also includes country. specic option pac7ages in order to satisfy their customers’ needs 6ouching upon the topic of ?8-, BMW di*ersies its acti*ities % in order to 'e tolerated and appreciated 6he ?8- acti*ities in ?hina span, amongst other things, resources inno*ation, education, and cultural eCchange 9 social inclusion10 8upport acti*ities+ Dne of the most signicant characteristics of BMW is its maor sta7eholder, the Euandt family 6ogether they hold (&$F of the shares 11 and guarantee the company’s long.term oriented and sustaina'le de*elopment A good eCample for the emphasis on sustaina'ility is the oint *enture 8G A?2 that ensures the supply of car'on 'ers, especially for the ne" electrical *ehicles !nno*ation is one of the 7ey strengths of the Group+ 11,)5% employees are engaged throughout BMW’s glo'al research and inno*ation net"or7 "hich is spread o*er *e countries -9: eCpenditures rose 'y #1)F to roughly 3 5,000 million in #01)) Internal Analysis | Weaknesses :espite the great success of BMW, there are some mentiona'le "ea7nesses 6he promise of high quality standards is frequently o*ershado"ed 'y quality.'ased product recalls 'oth in domestic and foreign mar7ets 1# !n spite of the creation of a pension fund outside the company, there stills remains a note"orthy portion of unfunded pension o'ligations inside the company 6he costs are *olatile due to the macro economic factors ol7s"agen or General Motors 6hus, a smaller num'er of cars has to 'ear all company’s costs 6hough, BMW’s holds a strong position in the premium segment 'ased on a consistent 'rand portfolio External Analysis | Threats A choice of eCternal factors on the 'usiness situation of BMW "ill 'e assessed through a P86 analysis1)
premium cars 6his "orst case scenario is on the radar of BMW ot"ithstanding, there are other more rele*ant threats that 7eep BMW occupied Dne of the 'roader political issues are the strict regulations concerning eChaust emissions BMW and the "hole automo'ile industry has to endea*or to constantly reduce fuel consumption and eChaust emissions 6he la"s require massi*e -9: in*estments from BMW as its product portfolio oers mainly po"erful premium cars "ith higher fuel consumption An economic issue that concerns BMW is the currency Huctuations ?urrently, BMW 'enets1( oo7ing at the P86 factors in the Asian mar7et, BMW faces further political threats such as tari and non.tari 'ased import 'arriers, local content requirements, changes of Go*ernment, ne" uneCpected la"s and political unrest 6he social threats are manifold 6here are language 'arriers for products, especially "hen it comes to man.machine.interface Ience, dierences in culture, desires and needs ha*e to 'e identied, carefully researched, and e*entually integrated in all primary acti*ities External Analysis | Opportunities !n deance of challenges and threats, BMW has 'een a'le to demonstrate increasing results o*er the past *e years and there is a great amount of opportunities that ena'les BMW to set am'itious goals for the years ahead 2irstly, there is a gro"ing glo'al mar7et for premium cars, led 'y the impressi*e increase in the o*erall ?hinese passenger *ehicle mar7et 15 6he ongoing ur'aniJation in Asia and the glo'al demand for sustaina'ility fuels the mar7et for megacity *ehicles and electric *ehicles1& A product that meets the ne" needs is the BMWi series) Iighlighting mo'ility ser*ices, BMW created the oint *enture :ri*eo" "ith the 8iCt Group in order to prot from the ne" mo'ility trends in German cities 6he successful car sharing concept has already 'een eCpanded to other uropean countries and the Knited 8tates Asian mar7ets might not 'e ready yet 'ut the t"o parent companies ha*e the resources to enter those mar7ets e*entually
Conclusion
6he strong position in the premium mar7et, the long.term orientation and the ro'ust focus on -9: com'ined "ith the 'road glo'al presence "ill ena'le BMW to ta7e ad*antage of the mo'ility, sustaina'ility and ur'aniJation trends and to continue their path to success
Limitations
ue to the limited frame this analysis only touches on points that seemed important to the author# The !gures in the appendi' comprise further aspects#
Word count
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Appendix 2igure 1+ D"n :iagram on the 8WD6 Analysis for the BMW Group . . . . . . .
8trong position in the premium segment -o'ust focus on -9: >arious product oers Ucient :ynamicsV 2ar.reaching distri'ution net"or7 Gro"ing mar7et for premium cars !ncrease in ?hinese passenger *ehicle mar7et Kr'aniJation 8ustaina'ility focus :e*elopment of mega cities
, 5 6 8 . D P P D
. A 5 W A 5 I 6
.
Portion of unfunded pension o'ligations n Product recalls i in o'ection to g r quality promise a
.
M
Nsee P86 analysisO
. . . 2igure #+ D"n illustration of Porter’s >alue ?hain for the BMW Group p p u 8 t r o i * i t c A s e i t y r a m i r P s e
Administrati*e, nance infrastructure maor shareholder, AG
Dperation 'road presence, assem'ly
Dut'ound ogistics Great distri'ution
8ales and Mar7eting BMW Welt
8er*icing nancial ser*ices, customer
2igure )+ D"n chart of the P86 Analysis for the BMW Group Political unrest mission regulations 6aris as import 'arriers ocal content requirements ?hanges of go*ernment e" enforced la"s Euality perception of locally manufactures cars anguage 'arriers :eclining 'irth rate in Germany Ctreme sustaina'ility trend
P 86
?urrency eCchange rates and currency Huctuation 2inancial crisis 8hortage of s7illed "or7ers in Germany !ncreasing non."age la'or costs !nno*ati*e technologies of competitors
