– Check in opposition to supply –

 

Strong at the moment – Strong tomorrow.
Our BMW approach into the longer term

Dear Shareholders!

A heat welcome from BMW Welt in Munich. Lots of people speak in regards to the transformation of mobility and the automotive trade – how one will exchange the opposite. At BMW, we do issues a bit of in another way. We name it: steady progress. 

Becoming a bit of bit higher every single day – that’s what we aspire to. And what I, myself, am measured in opposition to. Never being happy with the established order brings us nearer to our formidable targets. Step by step. Or, extra fittingly, when speaking about automobiles: mile by mile. That could sound very grounded and methodical, however it actually yields extremely efficient outcomes.

We all the time look to the longer term. That is a part of BMW’s huge array of expertise. It provides us energy and empowers us, repeatedly, to take daring motion: We know what we’re able to! That is why BMW remains to be right here after 108 years. 

The movie confirmed our Board of Management – however we’re solely pretty much as good as our international staff. Together, we carry our mixed know-how to the roads – in a really literal sense. There are presently greater than 150,000 of us worldwide – representing almost each nationality there’s, united by the BMW Spirit. In autumn of final yr, we surveyed all our associates all over the world: 85 p.c mentioned they absolutely assist the corporate’s targets and technique. And even 93 p.c are proud to work for the BMW Group.

What a lift for us!

We are mobilising all of them for the following huge leap, as a result of your organization is as soon as once more reinventing itself – at exactly the correct time.

You, too, my expensive shareholders, are a part of our BMW staff. Your assist for our route provides us the momentum and latitude we have to make selections with a long-term perspective. This traces again to legendary entrepreneur Herbert Quandt. What a legacy! The subsequent era is carrying ahead that legacy – very like we do on the firm.

We all the time base our strategic selections on info and knowledgeable evaluation. This actually requires expertise and, generally, plain frequent sense, as nicely. This makes your organization sturdy and ensures that we stay composed in a turbulent setting. All of this comes collectively within the BMW approach. This strategy ensures that the next all the time holds true to your firm:

“Strong today – strong tomorrow”.

For monetary yr 2023: Should you approve our proposed dividend, you’ll obtain a payout equal to 33.7 p.c of our unappropriated revenue. During the monetary yr, we had revised our steerage upwards. At year-end we met all our targets. We posted stable development in gross sales, reaching a brand new all-time excessive of greater than 2.55 million autos. In truth, we’re the one German OEM to have regained our pre-pandemic stage.

Our Group EBT margin of 11 p.c got here in greater than our strategic goal of 10 p.c. We are constantly acting at a excessive stage, as confirmed by our EBIT margin within the Automotive Segment, which has been inside our outlined goal vary of eight to 10 p.c for the previous 9 quarters, together with the primary quarter of 2024.

This permits us to proceed to make substantial investments.

Our capital expenditure, in addition to our analysis and growth spending, will peak this yr. We will as soon as once more be making main investments – as a result of our actions are all the time geared in the direction of the longer term.

Individual mobility provides great potential for worthwhile development and gaining market share.

Today, let’s check out how we proceed to forge our BMW approach –
in 4 chapters.

1. Future to the max: Turning visions into actuality.
2. Following our personal convictions: Technology openness is efficient.
3. Global success at the moment means appearing regionally.
4. The automobile as digital companion: We are making mobility extra human, extra clever and extra sustainable.

These focal factors additionally make clear the subjects you requested by way of the shareholder portal.

Turning visions into actuality.

This is the primary subject I want to discuss at the moment.

What you see proper right here is nothing lower than the longer term: pure BMW – taken to a complete new stage. This is the place all the large subjects of future mobility come collectively: Electric. Fully digitalised. Sustainable.

For now, they’re nonetheless Vision Vehicles – however they are going to be on the roads in a really related kind very quickly. Last yr, I promised you a brand new Vision Vehicle, which we then unveiled on the IAA MOBILITY. The BMW Vision Neue Klasse celebrated its premiere right here in Munich. You’ll see straight away that it’s a sporty sedan.

No different automobile on the IAA acquired as a lot media protection and optimistic suggestions – which is simply another reason to carry alongside one other spotlight for you at the moment: The BMW Vision Neue Klasse X – a automobile that very clearly reimagines the BMW X philosophy in a completely new approach.

Both autos will compete in high-volume segments – as a result of we wish our improvements to have a broad impression, not simply in area of interest segments. Both autos underline that the NEUE KLASSE is constant and broad on the similar time.

Consistent – when it comes to design, expertise and sustainability. Broad – with respect to the opposite fashions that can comply with.

These are the 2 bookends of the NEUE KLASSE – with a number of room in-between that we intend to use. And we ship on our guarantees:

Within 24 months of the beginning of manufacturing, there shall be no less than six completely different fashions available on the market.

Our trade has by no means seen velocity fairly like this earlier than – but when anybody can do it, then it’s us at BMW. We are selecting up the tempo on an enormous scale.

Our new plant in Debrecen, Hungary, will cleared the path, with the launch of the primary X mannequin in late 2025. This will proceed seamlessly in 2026 with the Sedan at our essential plant in Munich, in addition to Plant Shenyang in China. In 2027, the NEUE KLASSE will even ramp up in San Luis Potosí, Mexico.

Our prospects ask: How far can I drive on electrical energy? How rapidly can I cost my automobile?

We are in a position to inform them: no less than 30 p.c farther and 30 p.c sooner. In apply, because of this: It solely takes ten minutes to cost your automobile for a 300-kilometre journey – hardly sufficient time to seize a espresso!

This is feasible because of the brand new sixth-generation spherical cells.  We are utilizing them for the primary time within the NEUE KLASSE – which suggests you’ll be able to sit up for an excellent higher-level “BMW driving experience”.

What would possibly seem like a Playstation is definitely 4 super-brains, every integrating a number of extremely smart management models. This opens up new prospects – from powertrain and driving dynamics, to automated driving, to how we work together with our automobiles.

The most essential side for our prospects is: What does the NEUE KLASSE really feel like on the street? The Board of Management already had the possibility to drive the pre-series – and, consider me, it gave us goosebumps.

The magnitude of the technological wave we’re unleashing turns into even clearer if you realise:

The improvements of the NEUE KLASSE shall be integrated into all BMW fashions within the coming years, no matter their drive expertise. In easy phrases: Soon, all BMW expertise shall be NEUE KLASSE. The NEUE KLASSE is ready to develop into our innovation and expertise booster for all future areas of exercise, together with design.

We aren’t simply taking mobility to a brand new stage; the BMW Group can be turning into a NEW firm. I consider that is totally in your curiosity as our shareholders.

My second subject for at the moment displays our perception within the effectiveness of expertise openness.

The coronary heart of the NEUE KLASSE is electrical – operating by itself, new structure. If demand for electrical autos continues to develop as forecast, we will leverage corresponding economies of scale.

But the world is a giant place – which is why we proceed to serve all markets with premium merchandise. With us, everybody can discover the correct drivetrain to swimsuit their wants. Anything else can be unwise from a enterprise perspective.

Using expertise clusters and modules allows us to be extremely versatile. Think of it like this: We can roll out improvements and technological advances throughout all architectures and segments, and scale them effectively.

We don’t distinguish between “old” and “new” autos – as a substitute, we ship cutting-edge expertise throughout all areas. And, furthermore, we provide the most effective total package deal. This is what we aspire to – and it’s maybe the underlying secret of your organization’s success.

Let me offer you a present instance: Following on from the brand new BMW 5 Series Sedan, the brand new BMW 5 Series Touring additionally is available in 4 drive applied sciences. The BMW i5* is all-electric, with a powerful on a regular basis vary of over 500 kilometres.

Plug-in hybrids additionally stay extraordinarily well-liked. For the brand new BMW 5 Series, the PHEV variant may account for about 20 p.c of our gross sales in Europe.

This reveals we’re proper on monitor with our ten engaging PHEV fashions. And in fact, the brand new 5 Series can be nicely acquired as a extremely environment friendly combustion engine.

Focused expertise openness shouldn’t be one thing that’s achieved in a single day. You know my place: Building automobiles is a extremely complicated process. New market gamers are realising this too.

It is a energy of your organization – and I consider it is usually a novel promoting level: The capacity to grasp this complexity, seamlessly, and to successfully orchestrate, scale and additional develop applied sciences.

Our gross sales figures verify this: BMW is sustaining its main place within the international premium phase. Our strongest development final yr got here from the higher premium and luxurious class, in addition to our all-electric fashions, or BEVs for brief. We delivered over 375,000 BEVs to prospects in 2023 – a rise of virtually 75 p.c over the earlier yr. 

This dynamism can be mirrored in our share of the worldwide BEV market: At 4.1 p.c, it’s already considerably greater than our share of the overall international market, which stays steady at 3.3 p.c.

Demand for BEVs will proceed to climb – though not in a linear vogue; it will likely be dynamic and market-specific. We reiterate this repeatedly – and it holds true in a number of markets.

We see e-mobility because the fastest-growing drive expertise – at the moment and sooner or later. By 2030, all-electric autos ought to account for about half of our deliveries. We stay dedicated to this purpose and are steering the ramp-up consistent with demand. We will keep versatile – even nicely into the 2030s.

We are aligning our strategic planning accordingly – and enabling our architectures. In this fashion, we are able to reply rapidly always. More than 15 BEV fashions shall be out there this yr throughout all BMW Group manufacturers.

Here, you’ll be able to see the MINI Aceman*.

In April, it celebrated its world premiere at AUTO CHINA. The Aceman is obtainable solely as a all-electric car.

It fills the hole between the Cooper* and the Countryman*, which has now grown considerably in dimension. The new Cooper is already bought out – no less than for the following 4 months. The solely factor lacking is the brand new MINI Convertible, which shall be launched within the second half of the yr.

Together, these fashions kind the NEW MINI Family, which is successfully the counterpart to the NEUE KLASSE at BMW: MINI’s leap into the longer term.

And: We produce the New MINI Family worldwide: at our Spotlight three way partnership in China; in Oxford, within the UK; and, for the primary time, additionally in Germany, at Plant Leipzig.

We talked about bookends earlier. Now, with our manufacturers, let’s soar from MINI go-kart feeling to our luxurious model, Rolls-Royce. Spectre* actually hit the bottom operating. What an outstanding begin! 

In the primary quarter of this yr, this mannequin alone accounted for 38 p.c of Rolls-Royce deliveries. That is how we do e-mobility within the luxurious class. Spectre glides alongside effortlessly, like a flying carpet. Our luxurious model’s autos have by no means been as compelling and as differentiated as they’re at the moment. And let’s not overlook that additionally they earn a major contribution margin for the corporate.

BMW Motorrad can be reporting worthwhile development, having celebrated its centenary in September. German Chancellor Olaf Scholz attended the anniversary celebrations at Plant Berlin-Spandau.

We shared two main milestones with him:

First, the inauguration of the brand new “BMW Motorrad Welt”. What BMW Welt in Munich is to automobiles, we now even have in Berlin for our two-wheeled autos. Second, the world premiere of the R 1300 GS. Many folks – myself included, as a bike fanatic – have been eagerly awaiting the next-generation GS. The commerce press was virtually euphoric about it.

For those that choose an electrical experience within the metropolis, BMW Motorrad’s second electrical mannequin, the CE 02, is ideal.

Our core BMW model additionally has a slew of upcoming, thrilling autos, with 14 launches and quite a few mannequin variants this yr alone.

The BMW 1 Series shall be launched onto the market within the compact class.

And we’ll launch the brand new BMW X3 – certainly one of our hottest fashions total. The new X3 shall be out there with a highly-efficient combustion engine and as a plug-in hybrid variant.

We just lately offered our new and future autos to our retailers, together with 1,500 retailers from throughout Europe in Amsterdam. We did the identical in Las Vegas for over 1,000 sellers from the Americas area. I bought the sense at each occasions that our retailers are genuinely enthusiastic about what’s to return.

Especially for Europe, I’ve to emphasize: The retailers will stay by our facet within the new gross sales system – that gained’t change. We are already utilizing direct gross sales for MINI in China and reporting optimistic experiences within the first European international locations. We shall be transitioning the BMW model to the brand new direct and absolutely digitalized gross sales mannequin in Europe from 2026, as deliberate.

You, our shareholders, additionally wished to know:

How are we progressing with hydrogen?

Our BMW iX5 Hydrogen* is presently on a world tour, present process real-life testing. It could be very nicely acquired, in all places it goes. Our pilot fleet is elevating consciousness of hydrogen’s function within the vitality transition – each for mobility and throughout industries. You rightly anticipate us to satisfy the European Union’s CO₂ necessities.

In 2023, the BMW Group considerably outperformed the CO₂ fleet restrict set for us by the EU by greater than 20 p.c. This yr, we anticipate to see one other slight discount, with all manufacturers and drivetrain variants contributing.

Technology-centric, with a transparent deal with e-mobility – we’re all the time constant in our actions: This is how we’re reshaping notion of your organization.

What the New York Times writes is exactly researched.

In March, the New York Times praised our drivetrain technique as far-sighted and constant. It described BMW as a “winner in electric vehicles” – and Tesla’s solely critical competitor. We can actually stay with that. People anticipate us to think about issues rigorously and provide you with sensible options – as a result of we constantly show our capacity to take action.

In half three, I’ll take a look at the explanations for our international success – which, now, greater than ever, requires us to behave regionally. If you look intently, your organization stands out as one of many automotive trade’s few “truly” international producers.

Something like this has to develop systematically – and we’ve been increasing our footprint for this objective over the many years.

Let me offer you three examples:

China – our largest single market; Europe – our most essential gross sales area; the US – our “second home”:

First: China, the place we make use of a couple of fifth of our workforce. It is – after Germany – our second-largest R&D location. BMW enjoys a excessive stage of belief there – and never simply amongst our personal prospects. We are extremely thought to be an organization, as a result of we enter into critical, long-term commitments.

This yr, we’re celebrating 30 years “at home in China” and greater than 20 years of dedication in Shenyang.

In April, we signed a brand new funding settlement with Liaoning Province, price 20 billion renminbi or 2.5 billion euros. The Shenyang manufacturing website of our BBA three way partnership is reworking right into a BMW iFACTORY.

Also in April, I used to be a part of German Chancellor Scholz’s financial delegation to China. Shortly after that, I used to be in Beijing at AUTO CHINA, the place Prime Minister Li Qiang visited exactly one non-Chinese producer – and that was the BMW Group.

A phrase I hear lots in China is “China speed”. This is a dynamic nation – and we’re selecting up the tempo to maintain up: Just final week, our six-millionth car produced in Shenyang since 2003 rolled off the meeting line. We solely reached the 5 million mark a couple of yr earlier. This means we turned out a million autos in simply 15 months – that’s true “China speed”.

Second: Europe.

We promote almost a 3rd of all our autos within the European Union, the place we function ten crops and keep a broad provider base. We all profit from a united Europe – each single day – and may channel all our collective efforts into preserving it.

BMW maintains a worldwide outlook. This is one thing the chair of the General Works Council and I’ve reiterated. We urge our associates to pay shut consideration each time seemingly easy options are proposed for sophisticated points.

Enjoying democracy means residing democracy – and that features participation, exercising your proper to vote and elevating your voice to face up for democracy. That is why we’ve requested everybody to vote on June 9.

What applies to Europe, applies much more to Germany: We want the most effective minds – and the neatest minds suppose very rigorously about the place they need to go. That is why we assist the “We stand for values” initiative.

In Germany, we’ve many debates about emotionally charged set off factors. There is broad consensus on meta-topics. This is how sociologist Steffen Mau describes it. His newest examine involves the conclusion: We usually are not a divided society.

As a end result, we shouldn’t communicate unwell of our nation and Germany as a location, however leverage our potential. I can solely agree with that.

Third: the USA.

We seek advice from the US as our “second home”. Next yr shall be our fiftieth yr within the United States.
In 2023, your organization was as soon as once more one of many largest internet exporters of autos from the US by worth. Germany is the one place the place we’ve a better buying quantity than the US, which presently totals 6.7 billion euros yearly.

For over 25 years, we’ve been a neighborhood accomplice – notably in South Carolina. Today, Spartanburg is our largest plant – and the entire of the encompassing area has grown with us.

China, Europe and the US: Three examples of how our native presence forges shut ties with the areas and markets.

We reside proof that everybody advantages when folks work collectively. That can be one of many the reason why your organization continued to develop in all main areas of the world in 2023.

We do enterprise across the globe – and profit from an built-in international economic system.

Now, our international world order is evolving – from a “unipolar world” to a “multi-polar world”, particularly within the final 10-15 years. Authors like Carlo Masala speak in regards to the extremely built-in and largely self-sufficient financial areas now rising. We stay dedicated to open markets and free commerce.

I additionally say this with a view to the European Union’s present deliberations over Chinese imports of electrical automobiles. A 360-degree perspective can be higher: 20 p.c of all BEVs bought in Europe final yr got here from China; nicely over half have been western manufacturers, together with BMW.

Protectionism triggers a spiral impact: Tariffs result in new tariffs, with protectionism quite than cooperation.

My over 30 years of expertise at BMW recommend that options come about after we attain out to 1 one other – and after we are ready to make compromises ourselves.

That is how we construct a consensus that makes us stronger as a society and an economic system and allows us to take motion.

You are justified in asking how your organization secures entry to diversified, fragmented markets.

The reply is: by persevering with to take a position at native stage. Also, by discovering native options and companions for the upstream worth chain.

“Local for local” is our recipe for achievement – and we at the moment are making use of this similar precept to producing cells for the batteries wanted for e-mobility.

Who has management over technological experience and urgently wanted uncooked supplies? That is what decides the competitiveness of firms and financial areas. We find manufacturing services for BMW high-voltage batteries near our car crops – in Hungary, the US and China. Just just a few days in the past, we laid the inspiration stone for the high-voltage battery meeting in San Luis Potosí, Mexico.

The advantages for us are clear: Short transport distances and provide stability within the occasion of unexpected occasions across the globe.

And to get actually native: Have you heard of Irlbach-Straßkirchen in Lower Bavaria? It will provide Gen6 batteries for our crops in Bavaria from 2026 onwards. The course of wasn’t totally easy. Residents wished to know: What are the advantages for our area? We engaged in in-depth discussions with them to construct belief. Ultimately, an awesome majority voted in favour of the brand new BMW location.

As you’ll be able to see: Global solely works at native stage – and this additionally applies to our provide chains.

We have discovered in recent times how weak and inclined to disruption they are often. Take a guess: How many elements do you suppose our crops worldwide should be equipped with every single day? The reply is:
36 million. The proper portions must be in the correct place, on the proper time, in the highest quality.

Our digitalised “i Supply Chain” technique ensures resilient provide chains.

Our “RiskHub” makes use of AI and knowledge analytics to determine high quality points within the provider community early. We additionally undertake a proactive strategy to keep away from provide bottlenecks.

You would possibly have already got heard of Catena-X. There’s great potential right here: Automotive producers, suppliers and, quickly, recyclers, are making a shared knowledge ecosystem that makes sprawling provide chains clear and permits us to trace the carbon footprint of particular person elements. The kind, amount and supply of the uncooked supplies put in will also be digitally documented, permitting us to “trace” them.

And we’re about to embark on a pilot challenge: Plant Landshut produces the kidney grille for the BMW iX* – one element product of many particular person elements. We shall be utilizing knowledge from Catena-X to measure the overall carbon footprint of manufacturing.

Wherever we collaborate with suppliers, we accomplish that as companions, all the time treating one another as equals. This is essential to me.

Chapter 4 of my speech focuses on the automobile as a digital companion: We are making mobility extra human, extra clever and extra sustainable.

The world of bits and bytes is extremely dynamic. Digitalisation, hand in hand with synthetic intelligence, is basically altering how we expertise mobility. The questions you submitted by way of the shareholder portal point out that this pursuits you, too.

Intelligent, self-learning techniques have lengthy been a part of our technique for the automotive manufacturing of the longer term. You know this as BMW iFACTORY.

Digital added worth might be skilled straight in our autos, however our strategy right here stays: Not all the things that’s doable additionally is sensible in a automobile.

Our Head-Up Display is a traditional. 20 years in the past, we introduced this expertise from the aeroplane into the automobile. Now, we’re revolutionising this show idea within the NEUE KLASSE.

Take a search for yourselves: Our “BMW Panoramic Vision” makes use of the total width of the windscreen. Pure high-tech. But we additionally use digitalization to extend safety. In this case, we cut back distraction whereas driving.

We have grown used to all the time getting the newest updates from our digital gadgets – and folks anticipate the identical from their automobiles. Over the air means we are able to replace software program within the car at any time, with out bringing it in to the workshop. We selected this route early.

Today, your organization has the world’s largest absolutely upgrade-compatible fleet available in the market. We can already attain greater than 7.5 million autos. 

The BMW 5 Series units the usual for automated driving. It is the primary automobile in Germany to be authorised for partially automated driving at speeds as much as 130 km/h on motorways.

This means you’ll be able to take your palms off the steering wheel whereas driving. Your automobile also can change lanes by itself, if you briefly look within the facet mirror. Active Lane Change Assistant with eye affirmation – a considerably unwieldy title for a real world first.

Since March 2024, Highway Assist has additionally been out there within the BMW 7 Series, X5, X6, X7, iX and XM*. That’s stage 2+.

The new BMW 7 Series does much more:

You may even quickly flip your consideration away from the street. It fascinates me, each time the automobile regulates its personal velocity, distance and monitoring. That is Level 3 extremely automated driving – out there within the new BMW 7 Series since March. A digital driving expertise wants to make sure the security of all street customers.

That is why your organization solely introduces mature technical options onto the street– no beta variations. No experiments on the expense of our prospects. You can all the time depend on that.

Since summer time 2023, we’ve been testing automated driving and parking features all the way in which as much as Level 4 absolutely automated driving at our new centre for automated driving in Sokolov within the Czech Republic.

Esteemed Shareholders,

The US publication Time Magazine and the web platform “Statista” analysed and in contrast 750 worldwide firms: Your firm did exceptionally nicely to make it into the highest ten and was, in actual fact, the highest-ranked automotive producer. 

Revenue development, sustainability and worker satisfaction – many individuals contemplate these to be conflicting targets. We discover a option to reconcile them.

Our markets are dynamic and the geopolitical setting unsure. This impacts us – identical to it does different firms.

You are relying on us to stay profitable – and, certainly, we’ll! We have formidable plans for the present monetary yr. We anticipate to see a slight enhance in gross sales, in comparison with the earlier yr, in addition to a considerably greater share of all-electric autos.

The first fourth months of 2024 present that we’re on monitor for all key efficiency indicators.

As CEO of BMW, I journey the world lots. Everywhere I am going, I see not solely how worthwhile particular person mobility is for many individuals, however how important it’s.

My expertise can be that the BMW Group is appreciated and recognised in all corners of the globe. All of this encourages us to proceed forging our personal BMW approach.

We are in a position to face up to the headwinds when we’ve confidence in our route – which we often do.

Your firm is a part of the worldwide group. We interact with it – and evolve in and alongside it. That is extraordinarily essential.

The BMW approach can be about our capability for resonance – a time period from physics that can be utilized in sociology.

So, what do I imply by capability for resonance?

I’m speaking about our capacity to understand and perceive our relationship with the world – in Germany and elsewhere. We take note of developments, soak up them – and provides one thing again to society in return. 

This is a pure course of we actively take part in and management.

We stay open to all enter, however by no means permit ourselves to be influenced with out cautious consideration or emotionalised by set off factors. Above all, we keep away from drifting aimlessly.

We are in everlasting resonance with our evolving society – consciously and for our mutual profit. And all the time targeted on effectiveness.

The following due to this fact holds true to your firm:

“Strong today – strong tomorrow”.

Another compelling cause so that you can proceed to face by us!

Thank you.