Daimler and BMW work together in the development of hybrides.
Just a month ago Daimler's CEO, Dieter Zetsche, said in an interview that he would like to have a closer relationship with BMW. Norbeit Reithofer, BMW's CEO, has a different opinion about that. He doesn't want to a too close bond.
BMW and Daimler have discussed joint-ventures for small cars and financial activities, but BMW’s CEO warns those move could dilute the brand’s image.
Accoding to the Frankfurter Allgemeine Zeitung, he said "There are clear limits.The BMW brand, which one study has valued at $24 billion, must not be diluted or the brand identity damaged.”
However, Reithofer hasn't ruled out any alliances with other car manufacturers. BMW and Daimler will continue to talk about a possibility and soon BMW could engane in a partnership with PSA/Peugeot-Citroen due to the sharing in engine technologies.
Monday, June 15, 2009
Sunday, June 14, 2009
BMW Bank
BMW’s Bank has seen deposits jump almost 70% over the past five months and the cash infusion is helping the company cope with the frozen credit markets as WNYC reported on March 26th.
This development is not just observable with the BMW bank but also with the bank from Volkswagen, AUDI, etc
Traditionally, the German car banks offered financing opportunitites for normal car loan and for their dealers. Around 10 years ago those car banks recieved the banking license and where from now operating as any other bank.
But how is it possible that the deposits of the BMW banks increased so much in past few months?
Jonathan Rosenthal argues that the German population thinks that this bank is saver than the "normal" banks because they have tangible assets such as plants. Additionally, the interest rates are currently between 5 to 5.5% on deposits whereas the majority in Germany offers 2 to 2.5%.
The perception that these banks are less risky is not supported by the ratings. These car banks are actually rated more risky. Jonathan Rosenthal advices the German government to keep an eye in this development!
The interest rates are so high because the firm use it to keep the company and its dealers running.
I have a time-deopsit at the BMW bank and I get 5.25% interest currently. This contract expires this August but due to these exellent interest rates, I probably will open again a time-deposit. I might even be able to recieve an even higher interest! And I am not really concerned about the risk because, the German government promised that they'll make sure everyone gets their deposits back in the case of bankruptcy due to bailouts!
This development is not just observable with the BMW bank but also with the bank from Volkswagen, AUDI, etc
Traditionally, the German car banks offered financing opportunitites for normal car loan and for their dealers. Around 10 years ago those car banks recieved the banking license and where from now operating as any other bank.
But how is it possible that the deposits of the BMW banks increased so much in past few months?
Jonathan Rosenthal argues that the German population thinks that this bank is saver than the "normal" banks because they have tangible assets such as plants. Additionally, the interest rates are currently between 5 to 5.5% on deposits whereas the majority in Germany offers 2 to 2.5%.
The perception that these banks are less risky is not supported by the ratings. These car banks are actually rated more risky. Jonathan Rosenthal advices the German government to keep an eye in this development!
The interest rates are so high because the firm use it to keep the company and its dealers running.
I have a time-deopsit at the BMW bank and I get 5.25% interest currently. This contract expires this August but due to these exellent interest rates, I probably will open again a time-deposit. I might even be able to recieve an even higher interest! And I am not really concerned about the risk because, the German government promised that they'll make sure everyone gets their deposits back in the case of bankruptcy due to bailouts!
Thursday, June 11, 2009
Stock Price
The closing price per share was today 29.41 Euro!
A slight increase since I started looking at BMW ( around 25 Euro)...
A slight increase since I started looking at BMW ( around 25 Euro)...
Tuesday, June 9, 2009
Board of Directors
Here is a little posting on the Board of Directors of the BMW AG:
The BoD has one Chairman, 3 Deputy Chairman and 15 more members. The board therefore, consists of 19 members. This is a very large numbers regarding that it is suposed to be 12 members or less!
Looking through their other board memberships, it can clearly be said that these people are ver busy.
However, there doesn't seem to be a restriction on how long they are allowed to serve.
I want to point out 2 members:
Prof. Dr.-Ing. Dr. h.c. Dr.-Ing. E.h. Joachim Milberg
Chairman of the Supervisory Board BMW AG, Munich, Germany
Elected to Supervisory Board: 2004
Current term expires: 2012
Until May 2002, he was chairman of the managment board.
Other board memberships*: Supervisory Board, Bertelsmann AG, Gütersloh, Germany; Supervisory Board, Festo AG, Esslingen, Germany; Board of Directors, Deere & Company, Moline, Illinois, USA; Supervisory Board, ZF Friedrichshafen AG, Friedrichshafen, Germany
Manfred Schoch serves as a Deputy Chairman and Member of Supervisory Board of BMW Group. Mr. Schoch is Chairman of the Central Works Council.
I think Mr. Schoch is important to mention becasue as Prof. Busija mentioned in class, one mamber of the board has to be an employee (member of the union)or 2 members have to be independent ambassadors from the union.
Overll, this board seems to work well regarding the performance of BMW compared to other firms in this industry, although it doesn't fulfill our characteristics!
The BoD has one Chairman, 3 Deputy Chairman and 15 more members. The board therefore, consists of 19 members. This is a very large numbers regarding that it is suposed to be 12 members or less!
Looking through their other board memberships, it can clearly be said that these people are ver busy.
However, there doesn't seem to be a restriction on how long they are allowed to serve.
I want to point out 2 members:
Prof. Dr.-Ing. Dr. h.c. Dr.-Ing. E.h. Joachim Milberg
Chairman of the Supervisory Board BMW AG, Munich, Germany
Elected to Supervisory Board: 2004
Current term expires: 2012
Until May 2002, he was chairman of the managment board.
Other board memberships*: Supervisory Board, Bertelsmann AG, Gütersloh, Germany; Supervisory Board, Festo AG, Esslingen, Germany; Board of Directors, Deere & Company, Moline, Illinois, USA; Supervisory Board, ZF Friedrichshafen AG, Friedrichshafen, Germany
Manfred Schoch serves as a Deputy Chairman and Member of Supervisory Board of BMW Group. Mr. Schoch is Chairman of the Central Works Council.
I think Mr. Schoch is important to mention becasue as Prof. Busija mentioned in class, one mamber of the board has to be an employee (member of the union)or 2 members have to be independent ambassadors from the union.
Overll, this board seems to work well regarding the performance of BMW compared to other firms in this industry, although it doesn't fulfill our characteristics!
Sunday, June 7, 2009
"Project i"
BMW refers to "Project i" to its push into electric cars.
BusinessWeek published an article on March 12th on this topic.
Currently, BMW is spending more than $1 billion on the development of a small car for urban drivers that will be electrically powered.
In New York and Los Angeles, BMW started a test market on such all-electric vehicles. BMW is leasing 500 MINI Sedans that have been modified to run on batteries. Daimler is currently testing eletric SMARTs in London.
This test project shall help to eliminate the industry's biggest fear that only few would be willing to pay a higher price for a car that only can drive 150 miles between charges.
Despite all the prejudices, BMW had no problems finding customers eager to pay $850 per month to lease such a mdifies MINI, although only 2 seats are usable because the batteries are displaced in the rear seats.
The moto of "you drive the future" seems hip!
Despite these great news, the indusrty still faces many problem that have to be solved. Even if the prices in battery fall to a third of its currnet price, the batteries per car still cost $14,000, as Boston Consulting Group estimated.
More optimistic consultants such as Consultant Bain & Co argue that by 2020 the costs of batteries will have fallen to $4,000 per car which would allow the car manufacturers to offer a showroom price of $20,000.
Especially BMW should be in a better position with this innovation than its rivlas becasue the well-heeled people who drive Bimmers might be just the kind of buyers who would want a sporty electric for commuting and short trips around town!
I really hope that this innovation becomes a great and not too costly alternative. It would help to solve many environmental problems. I would definitively consider buying such a car!
Would you be a potential customer?
BusinessWeek published an article on March 12th on this topic.
Currently, BMW is spending more than $1 billion on the development of a small car for urban drivers that will be electrically powered.
In New York and Los Angeles, BMW started a test market on such all-electric vehicles. BMW is leasing 500 MINI Sedans that have been modified to run on batteries. Daimler is currently testing eletric SMARTs in London.
This test project shall help to eliminate the industry's biggest fear that only few would be willing to pay a higher price for a car that only can drive 150 miles between charges.
Despite all the prejudices, BMW had no problems finding customers eager to pay $850 per month to lease such a mdifies MINI, although only 2 seats are usable because the batteries are displaced in the rear seats.
The moto of "you drive the future" seems hip!
Despite these great news, the indusrty still faces many problem that have to be solved. Even if the prices in battery fall to a third of its currnet price, the batteries per car still cost $14,000, as Boston Consulting Group estimated.
More optimistic consultants such as Consultant Bain & Co argue that by 2020 the costs of batteries will have fallen to $4,000 per car which would allow the car manufacturers to offer a showroom price of $20,000.
Especially BMW should be in a better position with this innovation than its rivlas becasue the well-heeled people who drive Bimmers might be just the kind of buyers who would want a sporty electric for commuting and short trips around town!
I really hope that this innovation becomes a great and not too costly alternative. It would help to solve many environmental problems. I would definitively consider buying such a car!
Would you be a potential customer?
Friday, June 5, 2009
Wednesday, June 3, 2009
Mission Statement
This statement is retireved from the annual report 2008:
"Today, the BMW Group is one of the ten largest car manufacturers in the world and possesses, with its BMW, MINI and Rolls-Royce brands, three of the strongest premium brands in the car industry.
The BMW Group also has a strong market position in the motorcycle sector and operates successfully in the area of financial services.
The Number ONE strategy, adopted in 2007, has set the BMW Group on course for a successful
future.
The business has been given a new strategic direction with the emphasis on profitability and
long-term value growth. The BMW Group’s activities will remain firmly focused on the premium
segments of the international automobile markets.
The mission statement up to the year 2020 is clearly defined: The BMW Group is the world’s leading provider of premium products and premium services for individual mobility."
I am a bit disappointed by this mission statement. It is not adressing any stakeholders and it is pretty broad in its "goals". However, it seems as if they wnat to concentrate of increaseing market share. This is actually consistent with the previous post.
Also, it does not mention any difficulties the whole industry faces. This statement could be several years old! What do you think?
"Today, the BMW Group is one of the ten largest car manufacturers in the world and possesses, with its BMW, MINI and Rolls-Royce brands, three of the strongest premium brands in the car industry.
The BMW Group also has a strong market position in the motorcycle sector and operates successfully in the area of financial services.
The Number ONE strategy, adopted in 2007, has set the BMW Group on course for a successful
future.
The business has been given a new strategic direction with the emphasis on profitability and
long-term value growth. The BMW Group’s activities will remain firmly focused on the premium
segments of the international automobile markets.
The mission statement up to the year 2020 is clearly defined: The BMW Group is the world’s leading provider of premium products and premium services for individual mobility."
I am a bit disappointed by this mission statement. It is not adressing any stakeholders and it is pretty broad in its "goals". However, it seems as if they wnat to concentrate of increaseing market share. This is actually consistent with the previous post.
Also, it does not mention any difficulties the whole industry faces. This statement could be several years old! What do you think?
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