Today, I would like to comment on three main points:
Let’s get straight to the first point:
We took the necessary steps to enable us to soften the impact of the crisis much earlier than any other car manufacturer. At the same time, we have been focusing our efforts on consistently implementing our Strategy Number ONE, charting our course for the future. Our goal is to maintain the BMW Group’s independence.
The following eight points show the BMW Group’s position in this challenging environment:
So the significant decrease in the 2008 operating result will have the following financial effect:
I am convinced that our employees understand the difficulty of the current situation and are willing to accept this hardship. Various activities initiated in 2008 have provided us with a solid basis for the challenging year 2009. Our business activities are and will remain focused on the long term.
How can we guarantee our future success in light of the changes and new challenges in our business environment?
You all know our strategy structure. We have implemented specific projects supporting all four pillars.
The global car market will continue to grow, and along with it the demand for premium products and services. Sustainability will definitely play a key role in defining premium. This applies to both environmentally friendly drive systems and production processes. The BMW Group is already the world’s most sustainable car manufacturer. 2008 marked the fourth consecutive year the Dow Jones Sustainability Indexes ranked us as the global industry leader.
We currently see certain changes and shifts between individual segments of the auto market.
Our premium brand MINI is very successful in the small-car segment.
A few years ago, we launched the BMW 1 Series as our premium offering in the compact class. In 2008, sales of the BMW 1 Series increased by about 36 percent to more than 225,000 units. Today, BMW 1 Series models make up almost 19 percent of our portfolio. And 2009 will see the launch of a new model in the compact class—the BMW X1. This car combines the versatility of an SAV with the flexibility of a compact car and BMW’s characteristic driving dynamics.
Our new BMW 7 Series is a clear statement for the further innovation development of automobiles in general and the new benchmark for all competitors. We are convinced that the new BMW 7 Series is the best car on the market right now. Our flagship model and its innovations have received enthusiastic feedback from the media—also thanks to the car’s efficiency. The 730d only uses 7.2 liter of Diesel per 100 km. This makes it very popular with customers as well: The new 7 Series was launched in Europe only a few months ago, but it is already the segment leader.
In 2009, we are launching a versatile and highly variable vehicle: the BMW 5 Series Gran Turismo. It is the near-series implementation of the Progressive Activity Sedan. Once again, we are defining an entirely new segment. For me, the BMW 5 Series Gran Turismo is premium at its most innovative.
3. Premium is also a matter of design
Design is and will remain a key factor in people’s buying decision. It is one of the major trends in the automotive future.
We plan to focus strongly on design in the years to come, and plan to continue to be a trendsetter in the area of design. The new BMW Z4, due out in May, is a perfect example of the direction we want to take.
Our strategy’s second pillar: Shaping the Future
Shaping the future of the automobile – this can only be achieved by reducing fuel consumption and emissions.
No other car company has reduced emissions as much as the BMW Group.
We even exceeded the ACEA voluntary commitment: Between 1995 and 2008, our EU fleet consumption decreased by 27 percent. And let me add:
The MINI E is the first result of project i and our first milestone towards electric mobility. Once again, we are ahead of our competitors. The MINI E is currently being tested by 500 customers in California in everyday city life. Customers in Berlin and Munich are about to join the project.
This field test makes us the car company with the largest fleet of electric cars. But euphoria is not called for—not yet anyway. It will take years and years before electric cars will be a common sight on our roads.
The second specific result of project i will be our Megacity Vehicle. This vehicle will be the first of a range of near-zero emission vehicles. Customers will have the choice between a fully electric drive and a high-efficiency combustion engine. Large-scale production could start in the first half of the next decade.
With the Megacity Vehicle, we are also pursuing a radical approach toward establishing a truly sustainable value chain—from development to production and sales.
The customer will continue to be an integral part of Strategy Number ONE
We want to continue to set our own course. Nevertheless, we will continue to cooperate with other car manufacturers—whenever necessary and reasonable. Obviously, a win-win situation is the key to a successful cooperation.
At present, we are developing our MINI engines together with PSA. And we have entered into a purchasing cooperation with Daimler which will soon be expanded. We plan to gradually increase the number of parts and components we purchase together.
Last but not least, my third point for the day: What is our forecast for the business year 2009?
2009 will be a transition year. We expect the recovery period to start in 2010. Unfortunately, the current downturn in business still continues. And as a result there still exists uncertainty in the overall market. Therefore it makes no sense to offer a reliable forecast for 2009 right now. We do not expect to match our 2008 retail level this year.
For this reason, we have developed several action scenarios depending on market development. At present, we expect automotive sales to decline by 10 to 20 percent in 2009. From 2010 on, our sales will pick up pace thanks to our new product portfolio. This momentum will increase with the high-profit contribution models to be launched between 2010 and 2012. Some of our competitors might enjoy a model-cycle advantage right now.
So we remain confident. And our profitability targets for 2012 remain unchanged. I stated at various occasions that the biggest challenge is the crisis has filtered into people’s mind. We think and act differently at the BMW Group. Our Strategy Number ONE is a clear roadmap to the future and because of this the BMW Group is well positioned to stay the course and meet successfully the challenges ahead. That’s premium as well.
And this is why we will continue to be a strong and sustainable company with three outstanding brands: BMW, MINI and Rolls-Royce.
Thank you for your attention!