The BMW Group.
We move body, heart and mind.
Ladies and Gentlemen,
The BMW Group is your company!
But why should you continue to invest in us? What makes us strong and
relevant? Why should – and why will – we still be around 100 years
from now? These are questions that concern us, just like they concern
you. You are our shareholders. A warm welcome from the BMW Welt in Munich!
This is the third time I have stood before you to answer your
questions. It is an honour – and also very important to me.
A company needs to know what it stands for – because that is what
enables it to stay the course, to rely on its own capabilities, to
withstand the headwinds and to constantly reinvent itself.
The BMW Group exists because we move body, heart and mind. That is
our internal compass: Our North Star that guides us at all times –
even in times of change. It tells our story: What set us apart in the
past? What can we achieve in the present? And where do our strengths
for the future lie?
My message to you is: Your company has a future.
That is our mission – and it is important to you, as well, Ladies and
Gentlemen. Your support is for the long term – and that needs to be
worth your while. Today, we are proposing a dividend of 5.80 euros per
share of common stock and 5.82 euros per share of preferred stock, in
recognition of our successful financial year 2021.
This represents a pay-out ratio of 30.7 percent and is within our
long-term target range. Our dividend policy remains appropriate and reliable.
Our future is also very important for more than 140,000 BMW
associates – who make a difference, each and every day. We are using
innovations to ensure our customers’ mobility. Last year, more than
2.5 million people purchased a BMW, MINI or Rolls-Royce vehicle. They
expect much more than just being able to get from A to B. They want to
experience and enjoy their mobility in a very individual way. Our
business model is based on precisely this feeling. Joy forms the core
of the BMW brand and is our constant in the midst of change.
Our future is also important to the suppliers we consider our
partners – because industrial value creation has become highly complex
and the interdependencies are stronger than ever. When supply chains
falter, that is when stable, trust-based relationships with suppliers
come into their own – just like they are right now.
Having a future remains the main economic currency. Your company is a
success story we continue to write. Every generation of managers has a
responsibility for this – in the spirit of Herbert Quandt, the bold
entrepreneur who believed in BMW. The next generation will continue
his legacy, making us stronger and preserving our entrepreneurial
freedom. We will build the future out of this trust.
There are three decisive action areas:
- Our strong foundation.
- Our successful transformation.
- Our NEUE KLASSE for a new age.
These areas are where I want to focus today.
You know your company: Empty claims, announcements that lead to
nothing – that is not how BMW operates. We are committed to action. We
deliver on our promises.
That gives us credibility – and you can always rely on that!
Let me give you two examples:
- In 2021, we once again overfulfilled the European Union’s
CO2 requirements, coming in at around 10 g/km lower.
- Our road to “net zero” sets out clear milestones up to 2030, based
on an approach that is both transparent and backed by scientific
evidence. As part of this, we became the first German automotive
manufacturer to join the “Business Ambition for 1.5°C degrees”
campaign launched by the Science-Based Targets Initiative – and we
are including the entire value chain in this.
Ladies and Gentlemen,
No matter how massive, how unexpected the demands may be, we can
handle them – and even emerge stronger than before. In the midst of
the global economic and financial crisis, we developed the BMW i3. No
electric model has been on the market longer. We turn upheavals into
new beginnings – and are doing so now once again.
That brings me to my first point: Our future has a strong foundation.
The whole industry is short of semiconductor chips right now. This is
a stress test for all of us. We are unable to build as many cars as we
could sell. It really hurts to keep customers waiting. But a modern
car contains thousands of chips.
In response to this, we are increasingly relying on direct supply
contracts. Semiconductor bottlenecks will remain a challenge for quite
some time – at least into the second half of the year and into 2023.
On the other hand, we are realising good prices for both new and used
vehicles – and our sales costs are going down in all markets.This is
also reflected in our business figures for 2021. We took advantage of
our opportunities – and achieved new all-time highs:
- Group earnings before tax totalled over 16 billion euros. This
includes around one billion euros from the provision in connection
with the antitrust proceedings brought by the European Commission,
which have now been concluded. We were therefore able to partially
reverse this provision.
- The EBIT margin in the Automotive Segment came in at 10.3 percent
at the high end of our target range.
- The Motorcycles Segment and Financial Services also posted growth.
- The BMW brand is back on top of the global premium segment, but
volume isn’t everything – because without desirable products,
nothing else matters.
- Global market share is also considered a hard currency in our
industry. Despite the coronavirus pandemic, we were able to increase
this to 3.4 percent.
We achieved all these things together, as a global “Team BMW Group”.
I would like to say a big thank you to everyone – also on behalf of
the Board of Management.
Ladies and Gentlemen,
Your company has a robust capital structure and is highly profitable.
This solid foundation supports us – especially in difficult times. In
the first quarter, we faced unforeseen events yet again – for the
third time in three years.
What is happening in Ukraine leaves us speechless – but we are not
standing idly by. As I said to you last year: Attitudes are reflected
in behaviour. That is truer now than ever: We immediately donated one
million euros to UNICEF to help the children affected. We halted our
contract manufacturing in Russia, as well as our vehicle exports to
Russia. We are now helping children who have fled Ukraine, alone or
with their mothers. One of the ways we are doing this is by supporting
SOS Children’s Villages in Poland.
People from nearly all countries work side by side at the BMW Group,
with more than 70 nationalities at the main plant in Munich alone.
Diversity is our strength. We practise peaceful coexistence ourselves
every day, at all 31 production and assembly facilities in 15
countries. We are also committed to global free trade, because it
brings people together and leads to progress and prosperity in all
regions. Your global company has been demonstrating this for years.
What are we doing about the supply bottlenecks for components from Ukraine?
On the one hand, we are making up the shortfalls at alternative
supplier locations and helping suppliers set up additional
manufacturing structures to secure delivery of critical components. On
the other hand, we are continuing to source wiring harnesses from
Ukraine – because this gives local suppliers a perspective for the future.
Several of our plants in Europe had to suspend or limit production
for a brief time. The same applies to our locations in China – due to
official requirements there to contain COVID-19.
Companies like to talk about “flexibility”. For BMW production, it is
our trademark: We are able to reallocate volumes at short notice and
adjust our production flexibly – something which sets us apart from
That is why we have ambitious plans again this year, targeting sales
on a par with last year’s high level. Our order books are extremely
full. The markets are keen to order our new all-electric models: the
BMW i4 and iX, as well as the MINI Cooper SE* and the iX3*. The BMW X
family is more popular than ever. We have sold nearly ten million X
vehicles to date. Almost half our deliveries to customers in 2021 were
In April, Pieter Nota and I visited the US, in Austin, Texas. We
presented our current and future vehicles to more than 1,000 retailers
from North, Central and South America. It was a highly emotional
event, with a tremendous sense of optimism and confidence towards the
future. You could really feel that the US is our second home. BMW was
also the largest vehicle exporter by value from the US in 2021, for
the eighth consecutive year.
Our market strategy aims for a good balance between the three major
regions of the world: the Americas, Europe and Asia. Understanding the
unique aspects of every region, providing adequate supplies for
customers, enabling local production, research and purchasing – that
is what we mean by “localisation”.
It is essential to future market success – and is also a response to
current geopolitical developments.
Let me describe this briefly, using China as an example:
In Shenyang, we will be opening a new plant this year at our Tiexi
location, which will build the long-wheelbase version of the new
all-electric BMW 3 Series Sedan specifically for China. Our facility
in the Dadong district has also undergone a comprehensive expansion,
as the BMW X5 with extended wheelbase that has been exclusively
tailored to the needs of Chinese customers ramps up there.
If the market situation is challenging in individual regions, other
markets “pick up the slack”.
Everyone expects the situation in the world to remain difficult:
policymakers, institutes – and so do we. In many cases, a string of
entirely new challenges come one after the other – with less and less
time in-between. Some of these are familiar: Dealing with pandemics.
Military conflicts with an economic impact. Fragile supply chains.
Growing protectionism. A shortage of resources. High raw material
prices. Energy insecurity. However, what is new is that the challenges
are now overlapping and having an impact at the same time, with
different degrees of intensity and in different constellations.
Dealing with multiple challenges is becoming the norm for businesses.
Despite the uncertainty, we have issued our guidance for 2022. A high
level of profitability remains our goal and our obligation – towards
you and towards all the stakeholders who contribute to our success.
Without the events in Ukraine, we would have been targeting an EBIT
margin in the Automotive Segment of between eight and ten percent –
which remains our strategic target range. However, for 2022, we are
now aiming for seven to nine percent. Our earnings before tax should
be significantly higher than last year – largely thanks to our joint
venture, BMW Brilliance Automotive. The contract with BBA has now been
extended until 2040 and, in February, the BMW Group acquired a
75-percent stake in the company.
As a result, BBA is now fully consolidated in the Group Financial
Statements. Strategically, this is an important step: It means that
the almost 25,000 BBA employees are now officially part of “Team BMW
Group”. Your company is taking its growth to the next level.
Our key financial figures for the first quarter already reflect this.
For instance, revenues increased by 16.3 percent year-on-year. Our
previously-held 50-percent stake was reassessed at fair market value
in connection with the purchase of the BBA shares. This resulted in a
higher value of around 7.7 billion euros. This effect is included in
Group earnings for the first quarter.
This year, we will prove once again that: BMW can handle a crisis.
BMW can handle transformation. And, above all: We are strong, because
we are transforming ourselves.
That brings me to my second point: Our successful transformation.
We firmly believe that: We have the right strategy. We have the right
products and technologies on the market at the right time. Our
transformation is having an impact – and moving us forwards. For this,
we continue to rely on operational excellence, bold thinking and our
own technology-based approach. With these characteristics, we are
turning the transformation into a competitive advantage – because, in
this process, we can exploit our typical BMW capabilities, such as
technological diversity, to the full.
The BMW way is not mainstream – but it is very effective. We are
lowering CO2 emissions quickly and effectively. Every
drivetrain contributes to this. Europe is now setting course for the
Green Deal. But before we rule out any individual technologies in
these early stages, we should validate the new ones sufficiently first!
We are further developing all technologies. This will deliver
substantial benefits for climate protection and for customers – today,
and in the coming decades.
Because: The markets won’t «tick» the same in the future, either. The
charging infrastructure is at different stages in its development.
Customers in different regions have different needs.
The most recent example of how we are implementing our open
technology approach is the new BMW 7 – one model, with four different
drivetrains, unique in the luxury segment. This car also marks the
launch of the latest generation of highly efficient combustion
engines, which already meet the Euro 7 standard.
This means our conventional drivetrains are prepared for regulatory
requirements into the 2030s. I would like to add that the main
financial expenses for this are already behind us.
The 7 Series is way ahead of its time. Imagine admiring a painting or
a work of art for the first time. Whether you are an art lover or not:
You intuitively know right away when you are looking at something very
special. That’s how it is with the new 7 and why we refer to it as our
masterpiece. It invites you to take a drive – or perhaps allow
yourself to be driven. We want our most discerning customers to feel
at home – as if they were in a private lounge. For me, it’s like a
leap into the future. I really like the superb 31-inch screen in the
rear compartment: the BMW Theatre Screen. It transforms your 7 Series
into a cinema.
The most powerful 7 Series is the all-electric model. It’s tech magic
– and that is exactly what our customers expect. In terms of
technology, no other car currently offers more. The i7* will be
released onto the market in November, as the first 7 Series variant.
We developed the electric sound together with Hans Zimmer. You don’t
have to be a fan of film scores to know that he just won his second
The new BMW X1 also offers real drivetrain diversity. Its
all-electric variant will be released towards the end of the year. The
iX1* will bring fresh momentum to the high-volume premium compact
class. In 2023, we will be electrifying the next core BMW product: the
This is all part of our “e-mobility roadmap”: Ambitious and
consistent, it is closely aligned with growing demand. That is how
your company will stay a leading manufacturer in the world of electric
cars. We will make sure of that!
- We will have eight all-electric models on the roads this year. If
we include pre-production vehicles, we are already building 15 BEVs
– which is short for Battery Electric Vehicles. All-electric
vehicles should account for at least ten percent of our deliveries
this year. In the first three months, our BEV sales more than
doubled compared to the prior-year quarter.
- By the end of 2025, we aim to break through another sound barrier,
reaching a total of two million of our BEVs on the roads.
- By 2030, at least half our global sales should come from
all-electric vehicles. We are naturally doing everything we can to
meet this goal earlier – because we are always looking to challenge ourselves.
- Our MINI and Rolls-Royce brands will be all-electric from the
early 2030s. In just a few months, we will be providing a look ahead
to the all-new MINI family.
- At BMW Motorrad, all upcoming urban models will be fully-electric.
Last year, we had a concept bike standing here; today, I brought
along the production model. I ride a motorcycle myself and, for me,
the BMW CE 04 is a real eye-catcher, perfect for the city.
We are exploiting the full potential of our flexible BMW
architectures – a strength that is unique to your company. This will
enable us to grow in all segments and across our entire portfolio.
A new addition is the hydrogen-electric drivetrain – which
complements e-mobility in a meaningful way at the high end of the
market – and will break through first in countries like Japan and
Korea, or in California. We have tested the BMW iX5 Hydrogen under
extreme conditions and will begin producing a small series in the autumn.
Progress to net zero does not just take place on the roads. It also
needs sustainable supply chains.
Every electric car sold increases the importance of the upstream
supply chain for the climate footprint. Hundreds of our partners
already use renewable energy and this has been written into their
contracts. Between 2019 and 2030, this will avoid around 20 million
tonnes of CO2 from the supply chain alone. Like I said: We
measure ourselves by our results.
We are also taking account of upstream added value within the
company: Going forward, our Purchasing, Development and Production
divisions will be working together in technology clusters. As part of
this process, we will be explicitly strengthening the responsibility
of our Purchasing and Supplier Network division. This will ensure we
get early access to the latest technology offered by our partners.
Developing our organisation in a dynamic way is another essential
element of the transformation for us.
At our Annual Conference, a journalist asked me: “Mr Zipse, why do
you use terms from the tech world all the time? Do you have to?” I
responded: “Because they describe our day-to-day life.” BMW is digital
through and through – and the real and virtual worlds are increasingly
merging. The tech world calls this the metaverse.
On the one hand, it relates to our products – since customers expect
a digital driving experience. We are rolling out BMW iDrive and our
Operating System 8, with Remote Software Updates over-the-air, across
all derivatives. We are masters of the digital car tech stack across
all domains, off-board and on-board – in other words, the entire set
of technologies used in developing all digital features. More than
10,000 experts around the world work together in our IT and software development.
But it also concerns our production: We are creating a virtual
representation of our processes, so that every plant has a digital
twin. In this way, we are revolutionising factory planning. To put it
simply: Cool digitalised vehicles are built in cool digitalised
plants. That is just one aspect of our BMW iFACTORY – our masterplan
for the future of production. At every plant, we are realising a new
dimension of LEAN, GREEN, DIGITAL.
There are also significant implications for our Sales and Marketing:
Here, we are digitalising the customer interface. By 2025, we will
process a quarter of our sales online, making use of both digital and
physical possibilities. Our retail network will remain relevant in
delivering a premium experience for our customers through sales and
service. We also see this as a potential advantage that we intend to
In a complex transformation, no one can win on their own. Our
partnerships are geared towards the long term. At the same time, we
ourselves remain in motion in a dynamic environment: For example, with
Qualcomm Technologies and Arriver Software, we are developing the next
generation of driver assistance systems and automated driving: with
Level 2, Level 2+ and Level 3 functions. We are working with the best
tech players, including Google and Apple, as well as highly
specialised start-ups. Our philosophy of cooperation and competition
is perfectly normal in the digital environment.
French automotive manufacturer Stellantis has announced that it plans
to acquire the carsharing operator SHARE NOW. The transaction is still
subject to approval by the relevant antitrust authorities. We are
reorganising YOUR NOW. Going forward, our joint venture with
Mercedes-Benz Mobility AG will concentrate on two business segments:
FREE NOW and CHARGE NOW. In other words: digital multimobility and
digital services related to charging. This is where we see potential
Ladies and Gentlemen,
The future needs binding targets and clear milestones.
And that brings me to my third point today: Our NEUE KLASSE
for a new age.
This is definitely your company’s biggest project for the future:
Digital. Electric. Circular. A quantum leap in technology – for our
product, our technology and our way of working. We will be awarding
most of the contracts for the first vehicles by the end of the year –
taking CO2 emissions and the percentage of secondary
material into account as criteria for selecting suppliers. This will
be integrated into the purchasing process – not an “add-on”.
The NEUE KLASSE is entirely geared towards e-mobility. That is also
what our latest GEN6 drivetrain generation stands for: more output, a
new cell chemistry and new cell formats. On 1 June, we will lay the
foundation stone for our plant in Debrecen. The pre-series for the
NEUE KLASSE will ramp up there with our new vehicle architecture
within 26 months. We are combining this with a unique step in
production processes: Our plant in Hungary is designed to operate
entirely without fossil fuels and will be the first car plant in the
world to do so. That means we are even producing without natural gas –
which is the subject of much discussion. That is quite a sensation. It
means that: We are not only able to supply the plant with energy that
is net carbon neutral, but also run it entirely CO2-free.
Where will most of the electricity we need come from? We will produce
it directly on the plant grounds. For the rest, we are using
100-percent renewable energy sources. Total requirements will mainly
be met from regional sources. As you can see: We are actively
contributing to the energy transition.
We are doing the same at our other locations worldwide: What suits
each plant best? What local options are there? That is how we are
reducing our climate footprint – always in the best-possible way for
the region. Environmental and economic action go hand in hand –
because our concept ensures stable prices and secures the supply.
One thing is clear: The NEUE KLASSE is designed to be – and will be –
as profitable as vehicles with state-of-the-art combustion engines. My
Board of Management colleagues and I recently checked out two concept
cars. I can promise you that you will also be fascinated by them. The
NEUE KLASSE represents precisely the quantum leap we are aiming for.
Ladies and Gentlemen,
Prices for industrial and precious metals, like nickel, aluminium,
palladium and copper, are rising rapidly. Recycling raw materials and
using less primary material offers a way out of this spiral. About 90
percent of the material we use is already recyclable, but our goal is
even more ambitious than that:
We aim to increase the percentage of secondary material in our
vehicles significantly: from around 30 percent currently to at least
50 percent. Your company is becoming less and less dependent on scarce
raw materials, with circularity as our new guiding principle – from an
environmental perspective, but also from an economic and geopolitical standpoint.
As a society, there is intense debate over how to reduce our
dependence on fossil energies. But, at the same time, we have to make
sure we don’t end up in new dependencies. Think of the raw materials
in batteries. For me, that is another argument for a broad range of
technologies: Diversity makes us resilient.
Circularity is not just a pipe dream for us: The light-alloy cast
wheels of the new MINI Countryman are made from 70 percent secondary
raw materials. Our BMW iVision Circular already made its mark at the
IAA Mobility trade show. This extraordinary Vision Vehicle is made
entirely from secondary and renewable raw materials and is 100 percent
recyclable. This is how we intend to move “body, heart and mind”.
We are leading the way – also for the German automotive industry.
Your company has published its second Integrated BMW Group Report.
Integrated reporting challenges us with every decision: What is the
overall impact? Not just economically and environmentally, but also in
the short, medium and long term. This is a complex requirement that we
face with confidence.
Confidence comes from having a perspective for the future – and a
company that is confident and growing is one that also hires new
employees. Our team is fully behind the BMW Group. This is not just a
gut feeling. Our global Employee Survey showed that we have found the
right balance between disruption and stability. And we view
transformation as an opportunity. For us, every year marks the next
logical step in our BMW journey into the future.
Your company is celebrating three anniversaries this year:
- BMW Plant Munich’s centenary.
- The 50th anniversary of the BMW Four Cylinder building, and
- 50 years of BMW M.
They are all proof that:
Together, we can continue to make a difference in the future – by
creating values and generating added value.
We trust that you will continue to stand by us.
MINI Cooper SE: Power consumption in kWh/100 km
combined: 17.6-15.2 WLTP.
BMW iX3: Power consumption in kWh/100 km combined:
BMW i7: Power consumption in kWh/100 km combined:
BMW iX1: Power consumption in kWh/100 km combined:
18.4-17.3 WLTP (forecast value based on vehicle’s prior development status).