BMW 2007 Annual Report Download

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Annual Report 2007

Table of contents

  • Page 1
    Annual Report 2007

  • Page 2
    Facts and figures 2007

  • Page 3
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds in 2007 Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Group Internal Management System - Earnings Performance - Financial Position...

  • Page 4
    ... 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...

  • Page 5
    ... 102,467 107,539 7.7 18.5 25.5 2.4 0.9 Rolls-Royce Motorcycles 2] Workforce at end of year 3] in euro million 2003 2004 2005 2006 2007 Change in % Revenues Capital expenditure Depreciation and amortisation Operating cash flow 6] Profit before tax Net profit 41,525 4,245 2,370 4,970 3,205...

  • Page 6
    04 Report of the Supervisory Board Joachim Milberg Chairman of the Supervisory Board

  • Page 7
    ... and financial position of the BMW Group, corporate planning, the composition of the Board of Management and risk management issues. The Supervisory Board made use of regular business status reports to keep abreast of business performance, including the degree to which stated objectives have...

  • Page 8
    ...employees in Germany off the balance sheet by creating external pension funds. The Supervisory Board believes that these measures will help to strengthen the Group's competitiveness in the long term. To coincide with the BMW Group's strategic realignment, the Board of Management has formulated a set...

  • Page 9
    07 marketing. Since 2005, he has been Chairman and Chief Executive Officer of Rolls-Royce Motor Cars Ltd., a subsidiary of BMW AG. Corporate governance and Declaration of Compliance During the financial year 2007, the Supervisory Board and the Board of Management again discussed the subject of ...

  • Page 10
    ..., the financial condition of the Group and compensation levels within the automotive industry and at other DAX-listed companies. In individual cases, the Personnel Committee authorised the acceptance of external mandates by current and former members of the Board of Management. In line with the...

  • Page 11
    ..., no objections were raised. The Board of Management and employees of the BMW Group have once again enabled the BMW Group to post excellent earnings for the financial year 2007. The Board of Management has also defined a new strategic direction for the BMW Group which puts it on course for long-term...

  • Page 12
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 13
    ... the BMW Group's production and sales networks. 2007 saw the opening of the BMW Welt in Munich, the new event and delivery centre for the BMW brand. Other further major areas of capital expenditure were the continued expansion of the Spartanburg plant in the USA and investment in the Dingolfing site...

  • Page 14
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 15
    ..., private consumption failed to match the mildly positive trends seen in previous years and stagnated in 2007. One of the main negative factors was the value-added tax increase that took effect in Germany at the beginning of the year. Although the employment market improved, and large numbers of...

  • Page 16
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 17
    ... quarter. Unit sales again rose steeply in the emerging markets of Asia. The Chinese market grew at the fastest rate (26 %), while India recorded a growth rate of 15 %. The South Korean market grew by 7 %. By contrast, the Japanese car market failed once again to benefit from the general improvement...

  • Page 18
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 19
    ... handed over to customers. The Rolls-Royce brand also reported strong volume growth (+ 25.5 %) in 2007. With 1,010 units sold, it was able to surpass the 1,000 mark for the first time. BMW Group - key automobile markets 2007 as a percentage of sales volume USA Germany United Kingdom Italy Spain...

  • Page 20
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 21
    ... value throughout the whole of the production process. The BMW Group continued to expand its production network in 2007. A new assembly plant for BMW 3 Series and 5 Series production was officially opened in March 2007 in Chennai, India. This is part of the production follows the market strategy...

  • Page 22
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 23
    ...the MINI Production Triangle, comprising the Hams Hall, Oxford and Swindon plants. The BMW Group announced that annual production capacity at the Oxford plant will be increased in the medium term to 260,000 units without additional capital expenditure. Successful production start for the Rolls-Royce...

  • Page 24
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 25
    ...sheet increased by 16.5 % to euro 51,257 million. At the year-end, 2,629,949 lease and financing contracts were in place with dealers and retail customers, representing an increase of 15.8 % over the previous year. The proportion of new BMW Group vehicles leased or financed by the Financial Services...

  • Page 26
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 27
    ... year under report, the Financial Services segment serviced 393,741 credit card accounts, 15.9 % more than one year earlier. The BMW Card is available in eleven countries. The MINI Card is part of the product range offered in Germany, the USA, the United Kingdom and Japan. Awards for service quality...

  • Page 28
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 29
    ...markets currently experiencing dynamic growth, in particular North America, the United Kingdom and Asia. Furthermore, approximately 175 employees from non-German locations were working in Germany or at other international locations away from their home countries. In the case of longer-term BMW Group...

  • Page 30
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 31
    ... aids relating to training, health, working environment and personal provision. The BMW Group's internal media are regularly updated on different aspects of saving for the future and highlighting possible areas for action. This information is wholly aimed at encouraging employees to take a pro...

  • Page 32
    ...Earnings Performance - Financial Position - Net Assets Position - Subsequent Events Report - Value Added Statement - Key Performance Figures - Comments on BMW AG Risk Management Outlook Design for recycling - EU directive on end-of-life vehicles In 2007, the BMW Group pushed ahead with its strategy...

  • Page 33
    ...in use at the BMW Steyr location since the beginning of 2007. At this plant, all waste water created during the production process is purified and fed back into the production system. This enabled the plant to save approximately 30 million litres of water in 2007. Environment-friendly transportation...

  • Page 34
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 35
    ... car Improved energy management has enabled the BMW Group to achieve far greater fuel economy throughout its latest range of models. The Auto Start Stop Function, which switches the engine off automatically when the vehicle comes to a halt, serves to save fuel. Brake Energy Regeneration technology...

  • Page 36
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 37
    ...expenditure is provided in Note [11] of the Group financial statements. The research and development expenditure ratio was 5.6 % (2006: 6.5 %). The BMW Group's innovation network comprises ten sites in five countries with a total of 9,800 employees. Leading position amongst premium manufacturers The...

  • Page 38
    ... - Internal Management System - Earnings Performance - Financial Position - Net Assets Position - Subsequent Events Report - Value Added Statement - Key Performance Figures - Comments on BMW AG Risk Management Outlook taneously taking the current condition of the driver into account. The BMW Group...

  • Page 39
    ... that close networks are in place between internal and external partners has an important role to play here. Increasing the transparency of activities with suppliers is also seen as being vital for the BMW Group. One of the main objectives of supplier management is to raise the quality of bought-in...

  • Page 40
    ... - Internal Management System - Earnings performance - Financial Position - Net Assets Position - Subsequent Events Report - Value Added Statement - Key Performance Figures - Comments on BMW AG Risk Management Outlook the BMW Group provides its suppliers with supply quality performance indicators...

  • Page 41
    ... the growth markets. The global presence of the BMW, MINI and Rolls-Royce brands was strengthened further during the past year with the opening of four new sales locations. A subsidiary was set up in India and a sales office opened in Slovenia on 1 January 2007, followed by sales offices in Rumania...

  • Page 42
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 43
    ... 2008. There are currently no plans to exercise the authorisation. The option of a share buy-back does, however, remain open to BMW AG. Buy-back of shares of preferred stock for employee stock plan BMW AG has allowed employees to participate in its success for more than 30 years. In this context...

  • Page 44
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 45
    ... automobile company) in the DAX 30 sustainability ratings compiled by Scoris. The BMW Group keeps the public informed of its commitment and the progress made in the field of sustainable business in its Sustainable Value Report, which is published once every two years. The current Sustainable Value...

  • Page 46
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 47
    ...the Board of Management is authorised to buy back shares and sell bought-back shares in situ- ations specified in § 71 AktG, e.g. to avert serious and imminent damage to the Company or for the purposes of an employee share scheme. There is no authorised or conditional capital at the reporting date...

  • Page 48
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 49
    ... of debt capital Market value of equity and debt capital The cost of equity capital is measured using the Capital Asset Pricing Model (CAPM). The cost of debt capital is partly based on the average interest rate paid for long-term external debt and partly on the interest rate applicable for pension...

  • Page 50
    ... light of defined accounting policies and external financial reporting requirements. The BMW Group primarily uses profit before tax and segment-specific rates of return as the key indicator figures by which it manages operating performance. For example, return on capital employed is used as the main...

  • Page 51
    ... previous year. Excluding exchange rate factors, Group revenues would have increased by 17.6 % or euro 8,397 million. Revenues from the sale of BMW, MINI and Rolls-Royce brand cars went up by 11.8 %. Revenues from motorcycles business fell by 2.5 %. Revenues from financial services business climbed...

  • Page 52
    ... - Earnings Performance - Financial Position - Net Assets Position - Subsequent Events Report - Value Added Statement - Key Performance Figures - Comments on BMW AG Risk Management Outlook 2007 2006 Revenues Cost of sales Gross profit Sales and administrative costs Research and development costs...

  • Page 53
    ...on shares in Rolls-Royce plc, London, and to fair value losses recognised on derivative financial instruments. Financial Position The Group cash flow statement shows the sources and applications of cash flows for the financial years 2007 and 2006, classified into cash flows from operating, investing...

  • Page 54
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 55
    ... in the balance sheet for pension obligations decreased by 7.8 % to euro 4,627 million. As in the previous year, the amount reported under pension provisions corresponds to the full defined benefit obligation (DBO). In the case of pension plans with fund assets, the fair value of fund assets is...

  • Page 56
    ...68 Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 57
    ... Annual Report on pages 142 to 145. The Compensation Report is a sub-section of the Management Report. Subsequent Events Report No events have occurred after the balance sheet date which could have a major impact on the earnings performance, financial position and net assets of the BMW Group. Value...

  • Page 58
    ...68 Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 59
    ... Post-tax return on sales Pre-tax return on equity Post-tax return on equity Equity ratio - Group Industrial Operations Financial Operations Coverage of intangible assets, property, plant and equipment by equity Return on Assets BMW Group % % 5.3 1.3 6.3 1.4 Financial Services Return on Capital...

  • Page 60
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 61
    59 BMW AG Balance Sheet at 31 December in euro million 2007 2006 Assets Intangible assets Property, plant and equipment Tangible, intangible and investment assets Inventories Trade receivables Receivables from subsidiaries Other receivables and other assets Marketable securities Cash and cash ...

  • Page 62
    ...Management System - Earnings Performance - Financial Position - Net Assets Position - Subsequent Events Report - Value Added Statement - Key Performance Figures - Comments on BMW AG Risk Management Outlook Revenues Cost of sales Gross profit Sales costs Administrative costs Research and development...

  • Page 63
    ... BMW AG Financial Statements and Management Report for the financial year 2007 will be submitted to the operator of the electronic version of the German Federal Gazette and can be obtained via the Company Register website. These financial statements are available from BMW AG, 80788 Munich, Germany...

  • Page 64
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 65
    ... global economic factors such as changes in currency parities and changes on the financial markets. The US dollar is particularly important for the development of Group revenues and earnings and represents the greatest individual risk within the BMW Group's foreign currency portfolio. Exchange rate...

  • Page 66
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 67
    ...) and credit rating (commercial customer business). Close contacts with borrowers, a good understanding of the leased or financed vehicles involved, prudent measurement of collateral and the use of local credit audits all help to prevent losses. For risk management purposes, the BMW Group reverts to...

  • Page 68
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 69
    .... Regular analyses and rigorous security management ensure high-quality protection. This includes the activities of the BMW Group's Security Operations Centre which is responsible for the security of internal network communications. The Group's core process Product development and the related IT...

  • Page 70
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 71
    ... successfully in the financial year 2008 with the initial benefits of the Group's new strategic direction already becoming visible. With the Number ONE strategy, the BMW Group will lay the foundation in 2008 for the planned improvement in profitability. This will involve measures on both the revenue...

  • Page 72
    ... Group Management Report A Review of the Financial Year General Economic Environment Review of Operations BMW Stock and Bonds Disclosures relating to Takeover Regulations and Explanatory Report Financial Analysis - Internal Management System - Earnings Performance - Financial Position - Net Assets...

  • Page 73
    ... be reflected in the key performance figures such as return on sales and return on capital that are used to manage the BMW Group. Adjusted for the exceptional gain on the Rolls-Royce exchangeable bond in 2007, the BMW Group aims to achieve higher pre-tax earnings for the financial year 2008 than one...

  • Page 74
    ...and Expenses recognised directly in Equity Notes to the Group Financial Statements Accounting Principles and Policies Notes to the Income Statement Notes to the Balance Sheet Other Disclosures Segment Information Responsibility Statement by the Company's Legal Representatives Auditors' Report 73 74...

  • Page 75
    ... Operations * 2007 2006 Revenues Cost of sales Gross profit Sales and administrative costs Research and development costs Other operating income Other operating expenses Profit before financial result Result from equity accounted investments Other financial result Financial result Profit before tax...

  • Page 76
    ... 2006 Financial Operations * 2007 2006 Intangible assets Property, plant and equipment Leased products Investments accounted for using the equity method Other investments Receivables from sales financing Financial assets Deferred tax Other assets Non-current assets Inventories Trade receivables...

  • Page 77
    ... tax Financial liabilities Other liabilities Non-current provisions and liabilities Other provisions Current tax Financial liabilities Trade payables Other liabilities Current provisions and liabilities Total equity and liabilities Total equity and liabilities adjusted for asset backed financing...

  • Page 78
    ... from sales financing Investment in marketable securities Proceeds from marketable securities Cash outflow from investing activities Buy-back of treasury shares Payment of dividend for the previous year Proceeds from the issue of bonds Repayment of bonds Internal financing of financial operations...

  • Page 79
    ... from sales financing Investment in marketable securities Cash outflow from investing activities Buy-back of treasury shares Payment of dividend for the previous year Proceeds from the issue of bonds Repayment of bonds Internal financing of financial operations Change in other financial liabilities...

  • Page 80
    ...shares from circulation Dividends paid Translation differences Financial instruments Actuarial gains and losses on pension obligations Deferred tax on transactions recognised directly in equity Net profit 2006 73 73 74 76 78 79 80 80 89 96 117 131 Group Financial Statements Income Statements Balance...

  • Page 81
    ... available-for-sale investments recognised directly in equity Fair value gains and losses on financial instruments used for hedging purposes recognised directly in equity Exchange differences arising on the translation of foreign subsidiaries Actuarial gains and losses on defined benefit pension and...

  • Page 82
    ... - mainly loan and lease financing - to retail customers and to dealers. The inclusion of the financial services activities of the Group therefore has an impact on the Group financial statements. In order to provide a better insight into the earnings, financial and net assets position of the Group...

  • Page 83
    ... not consolidated using the equity method since they are not material to the Group's earnings, financial and net assets position. They are included in the line Other investments , measured at cost less, where applicable, accumulated impairment losses. A separate List of Group Investments pursuant to...

  • Page 84
    ... in Equity Notes - Accounting Principles and Policies - Notes to the Income Statement - Notes to the Balance Sheet - Other Disclosures - Segment Information Assets Intangible assets and property, plant and equipment Leased products Investments in subsidiaries Receivables from sales financing Other...

  • Page 85
    ... fair value adjustments on acquisition, based on the Group's shareholding. Any difference between the cost of investment and the Group's share of equity is accounted for in accordance with the purchase method. Investments in other companies are accounted for as a general rule using the equity method...

  • Page 86
    ... the entire financial services business, including the expense of risk provisions and impairment losses, are reported in cost of sales. Cost of sales for the Financial Operations sub-group also includes the interest expense of Group financing companies. Research costs and development costs which are...

  • Page 87
    .... This includes production-related depreciation and an appropriate proportion of administrative and social costs. Financing costs are not included in acquisition or manufacturing cost. Non-current assets also include assets relating to leases. The BMW Group uses property, plant and equipment as...

  • Page 88
    ..., the fair value of available-for-sale financial assets is measured using appropriate valuation techniques e.g. discounted cash flow analysis based on market information available at the balance sheet date. Available-for-sale assets include financial assets, securities and shares in securities funds...

  • Page 89
    ...valuation which takes into account all relevant biometric factors. Actuarial gains and losses are recognised, net of deferred tax, directly in equity. The expense related to the reversal of discounting on pension obligations and the income from the expected return on pension plan assets are reported

  • Page 90
    ... cost. The BMW Group has no liabilities which are held for trading. Liabilities from finance leases are stated at the present value of the future lease payments and disclosed under financial liabilities. The preparation of the Group financial statements in accordance with IFRSs requires manage...

  • Page 91
    ... in the segment information on pages 132 to 134. [9] Cost of sales Cost of sales comprises: in euro million 2007 2006 Manufacturing costs Warranty expenditure Cost of sales directly attributable to financial services Interest expense for financial operations Expense for risk provisions and write...

  • Page 92
    ... Expenses recognised directly in Equity Notes - Accounting Principles and Policies - Notes to the Income Statement - Notes to the Balance Sheet - Other Disclosures - Segment Information duced consumption-based taxes amounting to euro 16 million (2006: euro 11 million). Administrative costs amounted...

  • Page 93
    ... also includes losses recognised on derivative financial instruments, in particular on stand-alone interest rate derivatives. The decrease in the fair values of these financial instruments reflected the changes in the interest rate structure. 2007 2006 Current tax expense Deferred tax expense...

  • Page 94
    ... course of events. An analysis of deferred tax assets and liabilities by position at 31 December is shown below: Deferred tax assets 2007 2006 Deferred tax liabilities 2007 2006 Intangible assets Property, plant and equipment Leased products Investments Other current assets Tax loss carryforwards...

  • Page 95
    ...decrease was due mainly to actuarial gains and losses (net) arising in conjunction with pension obligations and recognised directly in equity. The level of actuarial gains and losses in 2007 was affected in particular by the increase in the discount factors applied. Deferred taxes are not recognised...

  • Page 96
    ...directly in Equity Notes - Accounting Principles and Policies - Notes to the Income Statement - Notes to the Balance Sheet - Other Disclosures - Segment Information Earnings per share of preferred stock are computed on the basis of the number of preferred stock shares entitled to receive a dividend...

  • Page 97
    ...206 44,394 Apprentices and students gaining work experience 104,402 103,727 6,521 For information regarding the number of employees at the year-end, reference is made to pages 26 and 27 in the Group management report. The fee expense recognised in the financial year 2007 for the auditors of the...

  • Page 98
    ...factory and office equipment Advance payments made and construction in progress Property, plant and equipment Leased products Investments accounted for using the equity method Investments in associated companies Investments in other companies Non-current marketable securities Other investments 6,150...

  • Page 99
    ... 21 1,018 3,896 6,115 535 11,285 13,642 60 197 190 401 14 739 3,289 22 70 5 75 - - 247 - - - - - Depreciation and amortisation 1.1. 20061] Translation differences Current year Disposals Reversals 31.12. 2006 Carrying amount 31.12. 2006 31.12. 2005 2,447 2,737 290 - -4 -4 872 959 2] 87 445...

  • Page 100
    ... assets mainly comprise capitalised development costs on vehicle and engine projects as well as subsidies for tool costs, licences, purchased development projects and software. Amortisation on intangible assets is presented in cost of sales, administrative costs and research and development costs...

  • Page 101
    ... Investments accounted for using the equity method comprise the Group's interest in the joint venture BMW Brilliance Automotive Ltd., Shenyang. At the in euro million Changes in leased products during the year are shown in the analysis of changes in Group tangible, intangible and investment assets...

  • Page 102
    ... issued by the BMW Group on Rolls-Royce shares. A break-down of the different classes of other investments disclosed in the balance sheet and changes during the year are shown in the analysis of changes in Group tangible, intangible and investment assets on pages 96 and 97. loan financing for retail...

  • Page 103
    ... sales financing at the balance sheet date which have been renegotiated and which were otherwise overdue or otherwise required recognition of an impairment allowance. 31.12. 2007 31.12. 2006 Interest and currency derivatives Marketable securities and investment funds Loans to third parties Credit...

  • Page 104
    ... changed exchange rate parities with the US dollar and the British pound as well as to the changed interest rate structure. Marketable securities and investment funds relate to available-for-sale financial assets and comprise: 31.12. 2007 31.12. 2006 in euro million Stocks Investment funds Fixed...

  • Page 105
    ...relating to credit card business developed as following during the year under report: 31 December 2007 in euro million Allowance for impairment recognised on a specific item basis group basis Total Balance at 1 January Allocated/reversed Utilised Exchange rate impact and other changes Balance at 31...

  • Page 106
    ... prepaid interest, development costs not eligible for capitalisation as non-current assets, insurance premiums and rent. Prepayments of euro 494 million (2006: euro 522 million) have a maturity of less than one year. Collateral receivables comprise mainly customary collateral arising on the sale of...

  • Page 107
    ... impairment on trade receivables developed as following during the year under report: 31 December 2007 in euro million Allowance for impairment recognised on a specific item basis group basis Total Balance at 1 January Allocated/reversed Utilised Exchange rate impact and other changes Balance at 31...

  • Page 108
    ... of recognising changes in the fair value of derivative financial instruments and securities directly in equity, and actuarial gains and losses relating to defined benefit pension plans and similar obligations. Accumulated other equity was increased by deferred taxes amounting to euro 116 million...

  • Page 109
    ... amount of dividends paid to shareholders and share buy-backs. The BMW Group manages the structure of debt capital on the basis of a target debt ratio. An important aspect of the selection of financial instruments is the objective to achieve matching maturities for the Group's financing requirements...

  • Page 110
    ... to pay the benefits granted to present and in % 31 December past employees. Defined benefit plans may be funded or unfunded, the latter sometimes financed by means of accounting provisions. Most of the pension commitments of the BMW Group in Germany relate to BMW AG, whose pension plans, like...

  • Page 111
    ...to the Group's pension plans: in euro million 31 December Germany 2007 2006 UK Other 2007 2006 Total 2007 2006 2007 2006 Present value of pension benefits covered by accounting provisions Present value of funded pension benefits Defined benefit obligations Fair value of plan assets Net obligation...

  • Page 112
    ... directly in Equity Notes - Accounting Principles and Policies - Notes to the Income Statement - Notes to the Balance Sheet - Other Disclosures - Segment Information The expense from reversing the discounting of pension obligations and the income from the expected return on plan assets are reported...

  • Page 113
    ...134 245 205 111 6 343 21 172 106 5 298 15 1,471 3,246 493 6,029 819 2,074 3,429 669 6,432 260 Benefit obligations are covered in Germany by accounting provisions. In the United Kingdom, a substantial portion of plan assets is invested in debt securities in order to minimise value fluctuations.

  • Page 114
    ...Balance Sheet - Other Disclosures - Segment Information Provisions for obligations for personnel and social expenses comprise mainly profit-share schemes and bonuses, early retirement part-time working arrangements and employee long-service awards. Provisions for obligations for ongoing operational...

  • Page 115
    ... BMW Group at the relevant balance sheet dates relating to financing activities and comprise: 31 December 2007 in euro million Maturity within one year Maturity between one and five years Maturity later than five years Total Bonds Liabilities to banks Liabilities from customer deposits (banking...

  • Page 116
    ... and Expenses recognised directly in Equity Notes - Accounting Principles and Policies - Notes to the Income Statement - Notes to the Balance Sheet - Other Disclosures - Segment Information variable fixed BMW (UK) Capital plc, Bracknell variable variable variable fixed fixed BMW US Capital, LLC...

  • Page 117
    ... paper: Issuer Issue volume in relevant currency (ISO-Code) Weighted average maturity period (in days) Weighted average nominal interest rate (in %) BMW AG, Munich BMW Finance N. V., The Hague BMW (UK) Capital plc, Bracknell BMW US Capital, LLC, Wilmington, Del. EUR 1,630 million EUR 1,521 million...

  • Page 118
    ... the Balance Sheet - Other Disclosures - Segment Information Deferred income relating to service contracts relates to service and repair work to be provided under commitments given at the time of the sale of a vehicle (multi-component arrangements). Grants comprise primarily public funds to promote...

  • Page 119
    ... BMW Group also has other financial comin euro million mitments, primarily under lease contracts for land, buildings, plant and machinery, tools, office and other facilities. The leases run for periods of one to 95 years and in some cases contain extension and /or purchase options. Lease payments...

  • Page 120
    ...flow hedges and fair value hedges: Cash funds Fair value Carrying amount Loans and receivables Fair value Carrying amount Assets Other investments Receivables from sales financing 73 73 74 76 78 79 80 80 89 96 117 131 Group Financial Statements Income Statements Balance Sheets Cash Flow Statements...

  • Page 121
    119 Held-tomaturity investments Fair value Carrying amount Other liabilities Fair value Carrying amount Availablefor-sale Carrying amount * Fair value option Carrying amount * Held for trading Carrying amount * Cash flow hedges Carrying amount * Fair value hedges Carrying amount * - - - 52...

  • Page 122
    ...Cash funds Fair value Carrying amount Loans and receivables Fair value Carrying amount Assets Other investments Receivables from sales financing Financial assets Derivative instruments Marketable securities and investment funds Loans to third parties Credit card receivables Other financial assets...

  • Page 123
    121 Held-tomaturity investments Fair value Carrying amount Other liabilities Fair value Carrying amount Availablefor-sale Carrying amount 1] Fair value option Carrying amount 1] Held for trading Carrying amount 1] Cash flow hedges Carrying amount 1] Fair value hedges Carrying amount 1] - - -...

  • Page 124
    ... Group Financial Statements Fair value measurement of financial instruments The fair values shown are computed using market information available at the balance sheet date, on the basis of prices quoted by the counterparties ISO-Code in % or using appropriate measurement methods, e.g. discounted...

  • Page 125
    ... ineffective portion of fair value hedges. Fair value hedges are mainly used to hedge bonds and other financial liabilities. Credit risk Notwithstanding the existence of collateral accepted, the carrying amounts of financial assets generally take account of the maximum credit risk arising from the...

  • Page 126
    ...relevant market. The assets involved are generally vehicles which can be converted into cash at any time via the dealer organisation. Impairment losses are recorded as soon as credit risks are identified on individual financial assets, using a methodology specifically designed by the BMW Group. More...

  • Page 127
    ... of production material and funding is also organised on a worldwide basis, currency risk is an extremely important factor for Group earnings. At 31 December 2007, derivative financial instruments were in place to hedge exchange rate risks, in particular for the currencies US dollar, British...

  • Page 128
    ... used for hedging purposes comprise mainly swaps which are accounted for on the basis of whether they are designated as a fair value hedge or as a cash flow hedge. A description of how interest rate risk is managed is provided in the Group management report on page 63. As stated there, the BMW Group...

  • Page 129
    ... value risk on vehicles returned to the Group at the end of lease contracts. The risks from financial instruments used in this context were not material to the Group in the past or at the balance sheet date. A description of how these risks are managed is provided in the Group Management Report...

  • Page 130
    ... shareholder and Chairman of the Supervisory Board of DELTON AG, Bad Homburg v. d. H., which, via its subsidiaries, performed logistics services for the BMW Group during the financial year 2007. In addition, companies of the DELTON Group purchased vehicles from the BMW Group. These service and sale...

  • Page 131
    ... on the BMW Group website under the address www.bmwgroup.com/ir. Stefan Quandt, Bad Homburg v. d. H., and 11.58 % to Susanne Klatten, Munich. The shareholding of the members of the Board of Management of BMW AG is, in total, less than 1 % of the issued stock shares. remuneration of current members...

  • Page 132
    ... Income and Expenses recognised directly in Equity Notes - Accounting Principles and Policies - Notes to the Income Statement - Notes to the Balance Sheet - Other Disclosures - Segment Information [44] Application of § 264 (3) and § 264b HGB A number of companies and incorporated partnerships (as...

  • Page 133
    ...BMW, MINI and Rolls-Royce, as well as spare parts and accessories. BMW and MINI brand products are sold in Germany through branches of BMW AG and by independent, authorised dealers. Sales outside Germany are handled primarily by subsidiary companies and, in a number of markets, by independent import...

  • Page 134
    ... financial result Profit before tax - 229 3,232 Change compared to previous year % % 7.3 3,012 1.2 Return on sales Significant non-cash items Internal financing Capital expenditure Depreciation and amortisation Additions to leased products Investments accounted for using the equity method...

  • Page 135
    133 2007 Motorcycles 2006 Financial Services 2007 2006 2007 Reconciliations 2006 2007 Group 2006 1,223 - 2.5 5 1,255 3.1 10 12,146 26.5 9,603 19.0 10.9 - 13,182 214 62.2 - 11,305 193 56,018 14.3 - 48,999 5.0 - - 50.0 1,228 66.7 1,...

  • Page 136
    ... Sheets Cash Flow Statements Group Statement of Changes in Equity Statement of Income and Expenses recognised directly in Equity Notes - Accounting Principles and Policies - Notes to the Income Statement - Notes to the Balance Sheet - Other Disclosures - Segment Information The Board of Management

  • Page 137
    ... in accordance with the applicable reporting principles, the consolidated financial statements give a true and fair view of the assets, liabilities, financial position and profit of the Group, and the Group management report includes a fair review of the development and performance of the business...

  • Page 138
    ... net assets, financial position and results of operations of the Group. The Group management report is consistent with the consolidated financial statements and as a whole provides a suitable view of the Group's position and suitably presents the opportunities and risks of future development. Munich...

  • Page 139
    ... of the General Works Council Industrial Engineer Member of the Presiding Board, Personnel Committee, Audit Committee and Nomination Committee Mandates Deutsche Lufthansa AG ERGO Versicherungsgruppe AG Henkel KGaA Ulrich Eckelmann* Head of Division Industry, Technology and Environment with the...

  • Page 140
    ... SWISS International Air Lines AG Mandates AL TANA AG (Deputy Chairman) UnternehmerTUM GmbH 137 137 140 141 142 146 Corporate Governance Members of the Supervisory Board Members of the Board of Management Corporate Governance at BMW Group Compensation Report Shareholdings of Members of the Board of...

  • Page 141
    ...Officer of IG Metall Bavaria Franz Oberländer * Member of the Works Council, Munich Anton Ruf * Director Product Line L7 Stefan Schmid * (from 03.01. 2007) Chairman of the Works Council, Dingolfing Prof. Dr. Jürgen Strube Chairman of the Supervisory Board of BASF SE Mandates Allianz Deutschland AG...

  • Page 142
    ...Stefan Krause Finance (until 30. 09. 2007) Sales and Marketing (from 01.10. 2007) Mandates Allianz Deutschland AG 137 137 140 141 142 146 Corporate Governance Members of the Supervisory Board Members of the Board of Management Corporate Governance at BMW Group Compensation Report Shareholdings of...

  • Page 143
    ...'s own actions. Declaration of Compliance and the BMW Group Corporate Governance Code Management and supervisory boards of companies listed in Germany are required by law (§ 161 German Stock Corporation Act) to report once a year whether the officially published and relevant recommendations issued...

  • Page 144
    ... payments/benefits and attending non-business events have once again been communicated to employees working in the purchasing department as well as to some 600 suppliers. In 2007, the BMW Group set up a Compliance Committee which reports directly to, and advises, the Board of Management of BMW AG...

  • Page 145
    ... pension service cost. Members of the Board of Management holding a BMW Bank GmbH credit card have a credit line of up to euro 25,565. At the balance sheet date the balances resulting from credit card usage were all within the agreed limits. Compensation of the Board of Management for the financial...

  • Page 146
    ... reimbursement of expenses, a fixed amount of euro 6,000 (payable at the end of the year), a variable amount of euro 1,500 for each percent of the dividend resolved by the shareholders at the Annual General Meeting in excess of 4 % of the company's share capital (common stock). The Chairman of the...

  • Page 147
    ... 109,560 1] In accordance with § 15 of the Articles of Incorporation, the fixed compensation is paid after the end of the financial year. 2] Calculation based on the dividend proposal of the Board of Management and Supervisory Board and the compensation upper limit agreed with the members of the...

  • Page 148
    ...Klatten, Munich. The shareholding of the members of the Board of Management is, in total, less than 1 % of the issued stock shares. 137 137 140 141 142 146 Corporate Governance Members of the Supervisory Board Members of the Board of Management Corporate Governance at BMW Group Compensation Report...

  • Page 149
    ... the recommendations of the Government Commission of the German Corporate Governance Code pursuant to § 161 German Stock Corporation Act The Board of Management and Supervisory Board of Bayerische Motoren Werke Aktiengesellschaft ( BMW AG ) declare the following with respect to the recommendations...

  • Page 150
    ... drawn up in accordance with uniform IFRSs accounting policies. Equity and net result are translated at the closing rate. 148 148 150 152 154 158 160 161 Other Information BMW AG Principal Subsidiaries BMW Group 10-year Comparison BMW Group Locations Glossary Index Contacts Financial Calendar

  • Page 151
    ... Trading Ltd., Beijing BMW Austria Gesellschaft m. b. H., Salzburg BMW Holding B. V., The Hague BMW Australia Finance Ltd., Melbourne, Victoria BMW Finance N. V., The Hague BMW Overseas Enterprises N. V., Willemstad BMW (South Africa) (Pty) Ltd., Pretoria BMW Italia S. p. A., Milan BMW (Schweiz) AG...

  • Page 152
    ... profit percentage Financial Operations Profit before financial result Profit before tax Return on sales (earnings before tax /revenues) Income taxes Effective tax rate Net profit/ - loss for the year Balance Sheet Current assets Equity Equity ratio Group Industrial Operations Financial Operations...

  • Page 153
    ... 2000 4] excluding C1, sales volume to 2003: 32,859 units 5] up to 1999 including BMW F 650 assembly by Aprilia S. p. A., from 2006 including BMW G 650 X assemply by Piaggio S. p. A./ exclude dormant employment contracts, employees in the non-work phases of pre-retirement part-time arrangements and...

  • Page 154
    ... in the world markets with 23 production and assembly plants, 41 sales subsidiaries and a research and development network. 148 148 150 152 154 158 160 161 Other Information BMW AG Principal Subsidiaries BMW Group 10-year Comparison BMW Group Locations Glossary Index Contacts Financial Calendar

  • Page 155
    ...Group Technology Office, Palo Alto, USA BMW Group Engineering and Emission Test Center, Oxnard, USA BMW Group Technology Office, Tokyo, Japan BMW Group Entwicklungsbüro, Beijing, China Production Berlin plant Dingolfing plant Eisenach plant Goodwood plant, GB (headquarters of Rolls-Royce Motor Cars...

  • Page 156
    ... capital, reserves, accumulated other equity and minority interest) to the balance sheet total. [ERA] Remuneration Framework Agreement. 148 148 150 152 154 158 160 161 Other Information BMW AG Principal Subsidiaries BMW Group 10-year Comparison BMW Group Locations Glossary Index Contacts Financial...

  • Page 157
    ... new MINI petrol engines; the Oxford plant remains responsible for chassis construction, painting and assembly. The Swindon plant produces the pressed panels and chassis components. [Rating] Standardised evaluation of a company's credit standing which is widely accepted on the global capital markets...

  • Page 158
    ... Information [Return on Assets BMW Group] Profit before interest expense (expense from reversing the discounting of pension obligations and of other long-term provisions, sundry interest and similar expenses) and tax as a percentage of the balance sheet total. [Return on Assets Financial Services...

  • Page 159
    ... United Nations Conference on the Environment and Development, held in Rio de Janeiro in 1992, resolved a global action plan for combating poverty, ensuring a suitable population policy, promoting urban development, human rights, trade, agriculture, environmental protection, research and technology...

  • Page 160
    ... [N] New accounting treatment 02 - 03, 11, 43, 48, 151 New financial reporting rules 88 - 89 Non-current assets 54, 74, 77, 85, 99 -100, 104, 151 148 148 150 152 154 158 160 161 Other Information BMW AG Principal Subsidiaries BMW Group 10-year Comparison BMW Group Locations Glossary Index Contacts...

  • Page 161
    ...54 Balance sheet structure Industrial Operations 54 BMW Group value added 2007 56 [Production and sales volume] BMW Group Deliveries of automobiles 02 BMW Group Deliveries of automobiles by region and market 17 BMW Group - key automobile markets 2007 17 BMW brand cars in 2007 - analysis by series 18...

  • Page 162
    .../ir. Information about the various BMW Group brands is available at www.bmw.com, www.mini.com and www.rolls-roycemotorcars.com 148 148 150 152 154 158 160 161 Other Information BMW AG Principal Subsidiaries BMW Group 10-year Comparison BMW Group Locations Glossary Index Contacts Financial Calendar

  • Page 163
    Financial Calendar 161 Interim Report to 31 March 2008 Annual General Meeting Interim Report to 30 June 2008 Interim Report to 30 September 2008 29 April 2008 8 May 2008 5 August 2008 4 November 2008

  • Page 164
    Number ONE Opportunities < New > Efficiency The art of engineering our own future. BMW Group.

  • Page 165
    ... art of engineering our own future. 002 The BMW Group's strategic realignment. To stay in the lead, we need to meet tomorrow's challenges today. We need to take responsibility for finding answers to the key questions the world is facing - from climate change to the depletion of fossil fuel reserves...

  • Page 166
    04 Foresight The foresight to detect potential in the challenges of the future.

  • Page 167
    The art of engineering our own future. 05 Freedom The freedom to be able to question old habits.

  • Page 168
    Melting glaciers make water levels of the oceans rise by 0.8 millimetres each year (World Climate Report of the United Nations 2007).

  • Page 169
    Natural phenomenon or call for action?

  • Page 170
    Accept demographic structures or tap their hidden potential?

  • Page 171
    The population of the industrialised nations is ageing. For example: in Germany, one out of three people will be older than 60 in 2030.

  • Page 172
    Today's global export volume of goods and services amounts to over 10,000 billion euros each year.

  • Page 173
    Export globally or explore local opportunities?

  • Page 174
    The end of an era or a driving force for innovation?

  • Page 175
    Fossil fuels are running out, global crude oil reserves will have been exploited a few decades from now.

  • Page 176
    Millions of people travel the streets of megacities like Los Angeles every day. Traffic congestion is a common occurrence.

  • Page 177
    Collective stalemate or impulse for new concepts of individual mobility?

  • Page 178
    16 Agility The agility to see change as a new opportunity time and again.

  • Page 179
    The art of engineering our own future. 17 Knowledge The knowledge to have defined the framework for future activities.

  • Page 180
    18 Objective The objective to reinvent completely the concept of individual mobility.

  • Page 181
    The art of engineering our own future. 19 Willpower The willpower to stay in the lead in the future. BMW Group.

  • Page 182
    20 002 The BMW Group's strategic realignment.

  • Page 183
    Profitability and Growth Value enhancement as the main objective. Profitability and growth to safeguard independence. Scope to engineer our future.

  • Page 184
    23 002 The BMW Group's strategic realignment. 24 Mission 26 House of Strategy 38 Vision

  • Page 185
    ... in premium quality. This belief has always made the BMW Group cut its own path. EfficientDynamics is only one example which demonstrates that this approach has brought us to a new level time and again. We are going to continue along this path - for the benefit of our customers, our employees and...

  • Page 186
    ...conclusive answers to all these questions. But this was not our goal in the first place. The main point was that - by looking at our environment - we were able to set the direction the BMW Group will be taking by 2020 and to develop our corporate strategy Number ONE. ONE stands for New Opportunities...

  • Page 187
    ... of Number ONE resulted in the House of Strategy adopted by BMW AG's Board of Management. The vision to be realised by 2020 is the strategy's roof. It consists of specific targets concerning retail, return on capital employed and return on sales. The cross beam is the strategic competitive advantage...

  • Page 188
    .... This corporate culture provides the foundation of our strategy. Vision Competitive Advantage Growth Shaping the Future Access to Technologies and Customers Profitability Basic Principles BMW Group House of Strategy: four strategic directions are pursued to realise our vision for the year 2020.

  • Page 189
    ...How can we reach new customer groups and open up new markets? Growth means dynamics. Only profitable growth guarantees that our shareholders' investment will bear fruit, that employees will receive a profit-sharing contribution, and that we will be able to invest in new technologies at the same time...

  • Page 190
    ... year. The importance of the premium segment can be explained by a particular social phenomenon: the desire for individual products which help people distinguish themselves from others. Premium customers request premium product substance and quality. And they are willing to pay an adequate price...

  • Page 191
    ... range of services. As far as marketing of pre-owned cars is concerned, the BMW Group benefits from the fact that the company's cars retain their value better than most. In this field, our best option is high-end remarketing such as BMW Premium Selection and MINI next. Accessory sales and resale...

  • Page 192
    ... years. Engines from Munich, Steyr and Hams Hall are world famous. This is why it seems a logical choice to provide drive systems to other manufacturers in certain growth areas. Approximately one-fifth of our operating profit is presently achieved with financial services. Once again, this is a field...

  • Page 193
    ... an inherent part of our private and professional life. But conditions have changed dramatically. Experts warn us of the effects of global warming caused by carbon emissions from industrial production, power plants, households and road traffic. Add to that the depletion of fossil fuel resources. The...

  • Page 194
    ... intelligent energy management for Brake Energy Regeneration and battery charging. But there is more to electrifying the drivetrain: in 2009, BMW will launch a dynamic and efficient hybrid car. With the new strategy, the BMW Group has furthermore announced to invest into the development of entirely...

  • Page 195
    ... gives us access to these technologies. Future cooperations are also relevant to the sales organisation: in our industry, the dealers and fleet service providers are the main points of contact with the customer. But it will be important in the future to guarantee direct customer contact for the BMW...

  • Page 196
    ... the innovation network set up by the BMW Group and suppliers. Active cruise control with stop and go function supports the driver when starting the car and when braking in slow traffic, while always maintaining the required safety distance. It is designed for speeds up to 180 kilometres an hour and...

  • Page 197
    ... the effect of exchange rates? How can we create added value for our customers and achieve an adequate price for our products? Profitability and earnings quality are the decisive factors in everything we do; our goal is independence. We consider it vital to apply the capital provided in such a way...

  • Page 198
    The BMW Group's strategic realignment. 37 ==1 ==2 ==3 ==1- 3 The BMW Group's brands - BMW, MINI and Rolls-Royce - are among the world's most valuable automotive brands, thanks to the company's strong premium position.

  • Page 199
    ... per year. From 2012 onwards, we intend to achieve a return on capital employed of 26 percent and consequently a return on sales of between eight and ten percent. Our strategic objective is to ensure that: The BMW Group is the leading provider of premium products and premium services for individual...

  • Page 200
    ...39 This means that we no longer refer to ourselves as a producer, but rather as a provider, and are making customer orientation and our understanding of service the focus of the BMW Group. At the same time, we continue to operate in the premium segment, not only in terms of our cars and motorcycles...

  • Page 201
    40 Strategic Objective The objective is to be the leading provider of premium products and premium services for individual mobility.

  • Page 202
    Bayerische Motoren Werke Aktiengesellschaft 80788 Munich, Germany Telephone +49 89 382-0 Fax +49 89 382-1 08 81

  • Page 203
    The year 2007. Seize the future.

  • Page 204
    03 The year 2007. Seize the future. 04 Preface by the Chairman of the Board of Management. 08 Report: A matter of consistency. 26 The year 2007.

  • Page 205
    04 Norbert Reithofer Chairman of the Board of Management

  • Page 206
    ... was a successful year for the BMW Group and an eventful one, too. We accomplished what we set out to do at the start of the year and delivered what we had promised you, our shareholders. In addition to that, more than 1.5 million customers around the world bought an automobile from the BMW Group in...

  • Page 207
    06 Strategy Number ONE developed Number ONE is our path to the future. This strategy will allow us to address the challenges we all face as a company and as part of society. The most important task for an automobile supplier is surely that of reducing vehicle emissions. That is absolutely ...

  • Page 208
    ...premium segments of the international automobile and motorcycle markets. To be precise: we will maintain our leading position. Our new strategy Number ONE will help us - and the dedication and motivation of all our employees will guarantee our success. Yours, Norbert Reithofer Chairman of the Board...

  • Page 209
    08 001 A matter of consistency. Report

  • Page 210
    Leader in Innovation Fresh thinking: better performance and safety combined with less consumption and lower emissions. Leadership begins in the mind.

  • Page 211
    ... things today. BMW Group engineers reveal what sustainable mobility could look like through a mixture of unconventional ideas which are already taking effect today and will have a broad impact reaching far into the future. Their most important tools are curiosity, expertise, and plenty of questions.

  • Page 212
    12 ==1 ==2

  • Page 213
    ...other specialists within the BMW Group's global development and production network are currently working on this silent revolution in efficiency. At Forschungs- und Technik GmbH, researchers are refining technologies which will one day use the energy from vehicle exhaust emissions. In Troy, Michigan...

  • Page 214
    ... the road to less consumption in automobile design. Many key technologies which were discovered and readied for series production by the BMW Group later found their way into the mass market. For instance, the integrated overrun fuel cutoff, which made its debut in 1976 in the BMW 3.0si, is taken for...

  • Page 215
    Report: A matter of consistency. 15 ==1 - 3 BMW Group employees prepare 1:2 vehicle models for wind tunnel tests. ==1 ==2 ==3

  • Page 216
    16 ==1 ==2 ==3

  • Page 217
    Report: A matter of consistency. 17 How can we use the momentum of thrust phases? How can the fuel injected into engines be used even more efficiently? Or how does switching on the headlamps or air conditioning affect a vehicle's energy consumption? Where do further potential energy savings lie ...

  • Page 218
    18 ==1 ==2 ==3

  • Page 219
    ... engine stop functions years ago, but they were quickly withdrawn from the market because they were too cumbersome, too unreliable, and, as a result, ineffective. However, engineers at the BMW Group knew from simulations and trial runs that switching off and restarting the drive train for state...

  • Page 220
    20 ==1 ==2

  • Page 221
    ... in the exhaust gas to easily supply the air conditioning, vehicle computer and navigation system as well as all the electronic consumer loads on board. ==1 - 2 Setting up the technology to measure and analyse all energy flows in the vehicle. ==3 The Auto Start Stop Function helps to reduce fuel...

  • Page 222
    ... about 100 development engineers at the BMW Group who have been working at the Hybrid Development Center in Troy for just over two years. In this Detroit suburb in the US state of Michigan the BMW Group has joined forces with Daimler, Chrysler and General Motors to form the Global Hybrid Cooperation...

  • Page 223
    ...Angeles for 20 years - and has been successfully proved and tested. The go-ahead for the development of the necessary capacities and infrastructure is still pending. Strobl and his research colleagues are using the intervening period to work, among other things, on improving tank technology. Because...

  • Page 224
    ... part BMW Group customers are happily unaware of the energy innovations in their vehicles. There are only two factors which make them perceptible: better driving dynamics and lower consumption. In this way the EfficientDynamics strategy has an impact that is both deep in terms of vehicle technology...

  • Page 225
    Report: A matter of consistency. 25 ==1 - 2 Thanks to its EfficientDynamics package the BMW Group has significantly reduced the fuel consumption and CO2 emissions of its vehicles. ==1 ==2

  • Page 226
    26 002 The year 2007.

  • Page 227
    Profitable Growth Operate more effectively. Substantially increase efficiency. Continue to improve and respond faster. Achieve greater autonomy.

  • Page 228
    ... 33 Ten years Intercultural Learning 33 BMW goes India 34 34 34 34 31 Research Centre for Artificial Intelligence 30 World premieres in Detroit April May 34 International Engine of the Year Award 35 Mille Miglia 2007 35 State Opera for All 35 Design Team of the Year 36 MINI United Festival in...

  • Page 229
    ... to the public for the first time at the North American International Auto Show in Detroit. With its classic lines and the convenience of a new retractable hardtop, this fourth-generation model heralds a new chapter in the four-seater convertible's success story. In Detroit the BMW Group also...

  • Page 230
    ... for Artificial Intelligence. Collaboration focuses on issues such as the future of the internet and its importance to mobile usage and in supporting mobility in an ageing society. This long-term cooperation further expands the BMW Group's research subsidiary's global technology and partner network.

  • Page 231
    32 March International Motor Show in Geneva - world premieres and visions. Alongside the new BMW 1 Series, the new BMW 5 Series and the M5 Touring are also presented to the public for the first time. The BMW M3 concept study is also unveiled. The company also introduces a wealth of technical ...

  • Page 232
    ..., efforts. BMW goes India. The opening of the BMW plant in Chennai, India, is the company's second move into India's growth market. The first step was taken on January 1st 2007 when the BMW Group set up a subsidiary in Delhi. The new plant will produce vehicles of the BMW 3 Series and 5 Series for...

  • Page 233
    ...04 One-millionth MINI. The one-millionth MINI rolls off the production line six years after series production started in Oxford. The MINI Cooper S is manufactured to individual customer specifications. The customer is BMW Group Mobile Tradition, for whom the designers created a special roof graphic...

  • Page 234
    ...BMW Group Design is Design Team of the Year . The 2007 red dot award for Design Team of the Year goes to the BMW Group. Chief Designer Chris Bangle accepts the award in Essen on behalf of all his staff. The BMW Group also picks up eight further awards for outstanding product design: two automobiles...

  • Page 235
    ... Festival in Zandvoort. More than 8,000 people from 50 countries flock to the MINI United Festival in the Dutch resort of Zandvoort on the North Sea coast. Under the motto Friends. Festival. Challenge. the MINI fan community enjoys three days of a unique mix of racing atmosphere, party and lifestyle...

  • Page 236
    ...90 years ago the Bayerische Motoren Werke was recorded in the register of companies. Two days later the letters BMW were being used on the company's products. 21 / 07 August 01 / 08 MINI wins top marks in frontal crash test. The new MINI emerges from the Euro NCAP Crash Test with a top rating of...

  • Page 237
    ... BMW 6 Series, boasting drive innovations and specific design modifications. The newly designed BMW M3 Coupé also makes its world debut. For the first time the BMW Group introduces a coupé for the Sports Activity Vehicles segment in the shape of the BMW Concept X6. The BMW Group's first automobile...

  • Page 238
    .... The MINI Clubman offers greater functionality and has a hatch with two doors that open to the side as well as an extra Clubdoor which opens to the rear on the vehicle's right-hand side. The new MINI John Cooper Works CHALLENGE was developed primarily for the Clubsport Series' MINI Challenge...

  • Page 239
    ... aligning itself to achieve profitability and increase value over the long term. The strategic objective is clearly defined: the BMW Group as the world's leading provider of premium products and premium services for individual mobility. As part of the realignment the BMW Group also creates two new...

  • Page 240
    The year 2007. 41 October BMW Welt opens. Right next door to the BMW Group headquarters, the BMW Museum, and the company's first plant, the BMW Welt opens its doors to the public. The architecturally striking building, for which the architect pushed the limits of what is technically possible, is ...

  • Page 241
    ... is the second BMW M3 body variant. Rolls-Royce production expands. Rolls-Royce Motor Cars announces that it will expand production capacity at its Goodwood facility. The company is thus responding to the strong demand for Rolls-Royce automobiles and preparing for the planned extension of its model...

  • Page 242
    The year 2007. 43 November New BMW motorcycles at the EICMA 2007. The revised models of the BMW Group's most successful motorcycles - the BMW R 1200 GS and the BMW R 1200 GS Adventure - are just two of the world premieres at the 65th EICMA International Motorcycle Show. The new BMW F 800 GS with ...

  • Page 243
    44 The year 2007. At the end of 2007 the BMW Group's product range includes 26 models that produce only 140 kilograms of CO2 per kilometre or less. If the Hydrogen 7 is included, that number increases to 27. In 2008 the company aims to roll out more than 800,000 automobiles equipped with ...

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    Consumption data Values measured in accordance with the New European Drive Cycle (EU Directive: 80 / 1268 / EEC in the relevant applicable version). Valid for vehicles with a European country...) 235 (235) 125 131 (146) 158 (172) BMW 330d Touring 330xd Touring 335d Touring 2] 320i Coupé 325i Coup...

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    ... with manual transmission. 2] only available with automatic transmission. 3] Values in brackets are valid for 7-gear M dual clutch transmission with Drivelogic Further information and constantly updated data for the vehicles is available on the Internet at www.bmw.com, www.mini.com and www.rolls...

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    ... The manufacture of, and the paper used for, the BMW Group's Annual Report 2007, have been certified in accordance with the criteria of the Forest Stewardship Council (FSC). The FSC prescribes stringent standards for forest management, thus helping to avoid uncontrolled deforestation, human rights...

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