BMW 2008 Annual Report Download

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Annual Report 2008

Table of contents

  • Page 1
    Annual Report 2008

  • Page 2
    ... operates successfully in the area of financial services. The Number ONE strategy, adopted in 2007, has set the BMW Group on course for a successful future. The business has been given a new strategic direction with the emphasis on profitability and long-term value growth. The BMW Group's activities...

  • Page 3
    Dual binding The two books slide apart to reveal the index register. This provides for fast and easy access to individual chapters.

  • Page 4
    ... Environment Review of Operations BMW Stock and Bonds in 2008 Disclosures pursuant to § 289 (4) and § 315 (4) HGB Financial Analysis 47 Group Internal Management System 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key...

  • Page 5
    ...Profit before financial result in euro million 4,500 3,750 3,000 2,250 1,500 750 Profit before tax in euro million 4,500 3,750 3,000 2,250 1,500 750 04 3,774 05 3,793 06 4,050 07 4,212 08 04* 3,583 * 05 3,287 06 4,124 07 3,873 08 921 351 adjusted for new accounting treatment of pension...

  • Page 6
    ... 37.7 - 6.6 - 0.2 Rolls-Royce Automobile production total Motorcycles 2 Workforce at end of year 3 BMW Group Financial figures in euro million Revenues Capital expenditure Depreciation and amortisation Operating cash flow 4 Profit before financial result Profit before tax Net profit 1 105,972 105...

  • Page 7
    08 Joachim Milberg Chairman of the Supervisory Board

  • Page 8
    ... the value-added chain. The Supervisory Board carefully considered the annual budget for the financial year 2009 together with the Board of Management, including the matter of forecasting sensitivities in the face of current business conditions. The Supervisory Board also kept itself well informed...

  • Page 9
    ... Board of Management in its endeavours to strengthen the BMW Group's competitive edge in this area. One Supervisory Board meeting was held in Steyr, Austria, where engines are developed and manufactured. Using the Steyr plant as an example, the benefits of a production system based on a value-added...

  • Page 10
    ... the parameters, level of compensation and pension benefits of current Board of Management members. It also considered the appropriateness of members' compensation arrangements in the light of their duties, individual performance and the current financial condition of the BMW Group. Comparative data...

  • Page 11
    ... 2008 as part of a Board reorganisation proposed by the Board of Management and supported by the Personnel Committee. Dr. Ganal - whose return to work had been hoped for until the end by the Board of Management, Supervisory Board and employees alike - had consistently worked with great energy...

  • Page 12
    ... the second half of 2008, the BMW Group had to assert itself in the midst of difficult business conditions brought on by a global crisis on the financial markets. The Supervisory Board wishes to thank the members of the Board of Management, employees and employee representatives for their joint...

  • Page 13
    ... Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook BMW Group's performance adversely affected by economic crisis The economic climate deteriorated drastically in 2008. Towards the end of the reporting year...

  • Page 14
    ...proportion of development costs recognised as assets, at 42.7 %, was at a similar level to the previous year (2007: 42.4 %). to 7.9 % (2007: 7.6 %) as a result of the lower level of revenues. BMW Group sells majority shareholding in Cirquent With effect from 30 September 2008, the BMW Group sold 72...

  • Page 15
    ...Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook Financial crisis reaches the real economy The world economy suffered a major setback in 2008. In the period up to summer the primary causes were the high...

  • Page 16
    ...period under report, it had stabilised at a level of approximately US dollar 1.40 to the euro. The US dollar's closing rate was therefore 4.3 % up on one year earlier. means that it lost approximately 28 % in value over the course of 2008. Prices of raw materials highly volatile The global economic...

  • Page 17
    ... Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook maintain the high growth rates seen in previous years and expanded by only 6 %. In India, the market increased by...

  • Page 18
    19 Group Management Report Fluctuations in reference interest rates were extreme in 2008. The American reference rate fell during the year from 4.25 % to a historic low (a range of 0 % to 0.25 %). After initially raising its reference interest rate by 0.25 percentage points to 4.25 % in July, the ...

  • Page 19
    ... 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook Sales volume down on previous year's high level The car sales volume recorded by the BMW Group in 2008 was influenced...

  • Page 20
    ...-based, thus allowing the BMW Group to profit to a high degree from its Efficient Dynamics technology. In Asia, some individual markets developed positively, with the BMW Group achieving a total sales volume of 165,745 units in this region, 3.9 % up on the previous year. Even though growth on...

  • Page 21
    ... Economic Environment Review of Operations BMW Stock and Bonds Disclosures pursuant to § 289 (4) and § 315 (4) HGB Financial Analysis 47 Internal Management System 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key...

  • Page 22
    ... annual sales volume increase and remains the most successful manufacturer in the super-luxury segment. Since its market launch in autumn 2008, a total of 137 units of the Rolls-Royce Phantom Coupé have been handed over to customers. Car production volume reduced on year-on-year basis The BMW Group...

  • Page 23
    ...51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook Highly adaptable production network As a result of the reduction in global car sales volumes, the BMW Group's production network...

  • Page 24
    ... to the commencement of assembly at BMW car plants in Germany to only two days. With this remarkable throughput time, the BMW Group is setting new standards for production efficiency in the automotive industry. In December, the expansion of the BMW development centre for diesel engines in Steyr was...

  • Page 25
    ... Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook F Series R Series R Series F Series 55.5 32.8 K Series 11.7 were manufactured during the period under report (- 0.2 %). Production at the Berlin plant...

  • Page 26
    ... financing of used BMW and MINI brand cars. At the end of the reporting period, the Financial Services segment had a portfolio of 2,785,509 contracts with retail customers, 16.0 % more than one year earlier. The number of contracts in place with retail customers in Germany rose by 19.4 %, partly...

  • Page 27
    ...System 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook Asia / Oceania / Africa America and fleet management, offering its services under the brand name...

  • Page 28
    ...% confidence level and a holding period of 10 days Size of workforce reduced The BMW Group's workforce was reduced by 7,498 employees (- 7.0 %) during the financial year 2008 to stand at 100,041 employees at 31 December 2008. This is largely due to the implementation of previously reported measures...

  • Page 29
    ... high quality during each startup throughout the entire production network. An increasing number of employees are also taking on international duties within the development and purchasing network. During the year under report, more than 650 BMW AG employees worked outside their home country, Germany...

  • Page 30
    ...of motivating managers to meet their targets. In future, annual bonuses will be linked to the post-tax return on sales, the net profit and the dividend level. Growth and profitability strategies are therefore now directly linked to the level of management remuneration at BMW AG. Internationalisation...

  • Page 31
    ... Economic Environment Review of Operations BMW Stock and Bonds Disclosures pursuant to § 289 (4) and § 315 (4) HGB Financial Analysis 47 Internal Management System 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key...

  • Page 32
    33 Group Management Report Fewer resources, lower emissions Energy savings totalling more than 650,000 MWh achieved throughout the BMW Group reduced energy costs by approximately euro 35 million in 2008. The reduction of other key indicators such as water consumption, process water and waste for ...

  • Page 33
    .... Roadmap of the BMW Group for sustainable mobility A fleet of approximately 500 purely electrically driven cars, the MINI E, put to the test in everyday traffic conditions. 2009 Adoption of the Efficient Dynamics strategy. 2000 2005 BMW Group cuts fuel consumption in Germany pursuant to VDA...

  • Page 34
    ... Auto Start Stop and Brake Energy Regeneration functions. These innovations are helping the BMW Group to reduce the fuel consumption of its new cars by up to 23 % compared to the relevant predecessor models. Efficient Dynamics is a global strategy across all models and therefore brings benefits not...

  • Page 35
    ...drive with the help of an innovative two-mode active gearbox. Unlike hybrid models that are currently available, BMW ActiveHybrid technology will deliver efficiency benefits not only in city traffic, but also out on the open road. Fuel savings of up to 20 % are possible in comparison to cars powered...

  • Page 36
    .... This includes functions such as Lane Departure Warning, Speed Limit Display, Lane Change Warning, Head-up-Display, High Beam Assist, Active Cruise Control with Stop & Go function, Night Vision (for the first time with Pedestrian Detection and Warning system), Side View and Back-up Camera. The...

  • Page 37
    ... 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook system has been expanded to include a Pedestrian Detection system, which identifies persons via camera and warns the driver of...

  • Page 38
    ..., whilst also having a positive impact on pricing structures. Natural hedging potential fully used Purchasing production materials, goods for resale, services and investment goods in the currencies of the sales markets in which the BMW Group operates helps to reduce exchange rate exposures. Careful...

  • Page 39
    ... were first-time customers for Rolls-Royce Motor Cars. Sales organisation restructured In line with the BMW Group's new strategic direction, sales and marketing activities were focused even more sharply on profitability and greater customer orientation. During the year under report, a decision was...

  • Page 40
    ...activities continue to emphasise the independence of the different brands. At the end of 2008, MINI had just over 500 and Rolls-Royce 80 exclusive sales and service locations. Targeted training of dealership staff and consistent application of selling standards ensure that the quality and efficiency...

  • Page 41
    ...Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook Stock markets tumble The worldwide financial crisis worsened in 2008, climaxing - at least for the time being - in the provision of government support to...

  • Page 42
    ...Xetra closing prices adjusted for new accounting treatment of pension obligations proposed by management annual average weighted amount stock weighted according to dividend entitlements calculated on the basis of operating cash flow: up to 2006 as cash inflow from operating activities of Industrial...

  • Page 43
    ... System 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook In 2008, for the fourth time in succession, the BMW Group was the sector leader in the Dow...

  • Page 44
    ... order of accruement, (b) payment of an additional dividend of euro 0.02 per euro 1 par value on non-voting preferred shares and (c) uniform payment of any other dividends on shares on common and preferred stock, provided the shareholders do not resolve otherwise at the Annual General Meeting. The...

  • Page 45
    ...47 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook The voting power percentages disclosed on the previous page may have changed subsequent to the stated...

  • Page 46
    ...level of individual product, process and infrastructure projects. By contrast, the credit and lease portfolios of the Financial Services segment are managed primarily on the basis of a cash flow and risk approach. Minimum rate of return derived from cost of capital The cornerstone of the value-added...

  • Page 47
    ... 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook Return on capital used to measure value on a periodic basis General business conditions relevant for periodic planning have a bearing on how product...

  • Page 48
    ... affected by ex- Group Income Statement in euro million 2008 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 Interest and similar...

  • Page 49
    ... Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook The BMW Group recorded a net profit of euro 330 million (2007: euro 3,134 million) for the financial year 2008. The post-tax return on sales...

  • Page 50
    ... flows for the financial years 2008 and 2007, classified into cash flows from operating, investing and financing activities. Cash flows from operating activities are determined indirectly starting with the Group net profit. By contrast, cash flows from investing and financing activities are based on...

  • Page 51
    ... 47 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook Financing activities in 2008 generated a positive cash flow of euro 12,904 million (2007: euro 6,168...

  • Page 52
    ...a leasing company which had included a part of the leasing business for Germany. Leased products rose by 14.8 % to euro 19,524 million. Adjusted for changes in exchange rates, they would have risen by 14.4 %. The carrying amount of other investments increased by 54.1 % to euro 322 million, mainly as...

  • Page 53
    ... Economic Environment Review of Operations BMW Stock and Bonds Disclosures pursuant to § 289 (4) and § 315 (4) HGB Financial Analysis Internal Management System 47 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key...

  • Page 54
    ... on the earnings performance, financial position and net assets of the BMW Group. Value Added Statement The value added statement shows the value of work performed less the value of work bought in by the BMW Group during the financial year. Depreciation and amortisation, cost of materials and other...

  • Page 55
    ...51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook 2008 in % 2007 in euro million 2007 in % Change in % Work performed Revenues Financial income Other income Total output Cost...

  • Page 56
    ... sales Pre-tax return on equity Post-tax return on equity Equity ratio - Group Automobiles Financial Services Coverage of intangible assets, property, plant and equipment by equity Return on Capital Employed Group Automobiles Motorcycles Return on Equity Financial Services Cash inflow from operating...

  • Page 57
    ...in the Group Financial Statements. The main differences relate to the recognition of intangible assets, depreciation and amortisation methods, the measurement of inventories and provisions as well as the treatment of financial instruments. BMW AG develops, manufactures and sells cars and motorcycles...

  • Page 58
    59 Group Management Report BMW AG Balance Sheet at  December in euro million 2008 Assets Intangible assets Property, plant and equipment Investments Tangible, intangible and investment assets Inventories Trade receivables Receivables from subsidiaries Other receivables and other assets ...

  • Page 59
    ... System 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook Revenues from the sale of vehicles to car rental companies are not recognised when there...

  • Page 60
    ...are presented here. The BMW AG financial statements for the financial year 2008 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 61
    ... operating enterprise, the BMW Group is affected by global economic conditions. This includes changes in exchange rates as well as developments on the financial markets. The financial crisis and its impact on the world's markets for goods and services had a major effect on reported Group revenues...

  • Page 62
    ... BMW Group's commodity management procedures. Changes in the price of crude oil, an important basic material in the manufacture of components, have an indirect impact on production costs. Moreover, the price of crude oil also directly influences the purchasing behaviour of drivers when fuel prices...

  • Page 63
    ...from business interruption and loss of production are insured up to economically reasonable levels with insurance companies of good credit standing. The BMW Group's highly flexible production network and working time models also help to reduce operating risks. Close cooperation between manufacturers...

  • Page 64
    ...customer business) 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...

  • Page 65
    ... of BMW Group employees are held in pension funds which are kept separate from corporate assets and mainly invested in fixed-income securities (with a high level of creditworthiness), equities, property and other investment classes. In 2008, a part of the pension obligations arising in Germany was...

  • Page 66
    .... 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 67
    ... 49 Earnings Performance 51 Financial Position 52 Net Assets Position 55 Subsequent Events Report 55 Value Added Statement 57 Key Performance Figures 58 Comments on BMW AG Risk Management Outlook The economic environment in The BMW Group forecasts that the global economic downturn will continue...

  • Page 68
    ... BMW Group. A great deal of preliminary work was carried out in originally developing this strategy. With business conditions having deteriorated so extremely, this preliminary work is proving to be a highly useful instrument in managing the business in the short term. The initiatives that emerged...

  • Page 69
    ... lower than in 2008. Financial Services segment Business conditions for the Financial Services segment will again be subjected to a high degree of volatility in 2009. The availability of attractive credit and lease products for customers of BMW, MINI and Rolls-Royce brand cars will remain the basis...

  • Page 70
    ... customer and dealer financing lines of business will diminish in the short term. As part of the strategy Number ONE, the further development of the various lines of business will be reviewed in the light of changed external parameters. As well as focusing on service quality and process efficiency...

  • Page 71
    ... 3,134 8 3,126 4.78 4.80 in euro million 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 Interest and similar income Interest and...

  • Page 72
    ...Group Financial Statements Automobiles 2008 48,782 - 40,791 7,991 - 4,572 - 2,714 559 - 574 690 25 766 -1,036 -127 - 372 318 - 92 226 6 220 2007 53,818 - 43,290 10,528 - 4,417 - 2,805 552 - 408 3,450 11 710 - 870 - 69 - 218 3,232 - 511 2,721 8 2,713 Motorcycles 2008... 60 Financial Services 2008 15,...

  • Page 73
    ... million 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 Receivables from sales financing...

  • Page 74
    ...152 - -11,254 - - 30 - 894 -11,396 - 26,726 -1 - - - 580 - - 35,337 - - 35,918 - 62,644 Automobiles 2008 2007 Motorcycles 2008 2007 Financial Services 2008 2007 Other Entities 2008 2007 Eliminations 2008 2007 22,481 2,847 2,412 1,931 2,685 3,986 13,861 1,795 468 2,599 2,029 9,950 16,841 53,183...

  • Page 75
    ... leased products Depreciation and amortisation of tangible, intangible and investment assets Change in provisions Change in deferred taxes Other non-cash income and expense items Gain / loss on disposal of non-current assets and marketable securities Result from equity accounted investments Changes...

  • Page 76
    ... leased products Depreciation and amortisation of tangible, intangible and investment assets Change in provisions Change in deferred taxes Other non-cash income and expense items Gain / loss on disposal of non-current assets and marketable securities Result from equity accounted investments Changes...

  • Page 77
    ...recognised directly in equity Profit after tax attributable to shareholders of BMW AG Aggregate amount of net profit for period and gains and losses recognised in equity 2008 -7 - 617 - 806 116 226 -1,088 324 - 764 2007 -183 373 - 422 559 - 388 - 61 3,126 3,065 72 72 74 76 78 79 Group Financial...

  • Page 78
    ... analysed separately in the Notes. In order to support the sale of its products, the BMW Group provides various financial services - mainly credit and lease financing - to retail customers and to dealers. The inclusion of the financial services activities of the Group has a significant impact on the...

  • Page 79
    ...the same year-end as BMW AG. The Group Financial Statements, drawn up in accordance with § 315 a HGB, and the Management Report for the financial year 2008 will be submitted to the operator of the electronic version of the German Federal Gazette and can be obtained via the Company Register website...

  • Page 80
    ... value of recognised net assets amounted to euro 14 million. This relates primarily to potential synergy benefits that can be realised by expanding lease and financing business. The full amount is attributable to the Financial Services segment. This goodwill is tested annually for impairment. BMW...

  • Page 81
    ...companies (intragroup profits) are eliminated on consolidation. Under the equity method, investments are measured at the BMW Group's share of equity taking account of fair value adjustments on acquisition, based on the Group's shareholding. Any difference between the cost of investment and the Group...

  • Page 82
    ... sold. It includes all directly attributable material and production costs and production overheads, including depreciation/amortisation of property, plant and equipment and intangible assets relating to production and write-downs on inventories. Cost of sales also includes freight and insurance...

  • Page 83
    ... financial liabilities. Where Group products are recognised by BMW Group leasing companies as leased assets under operating leases, they are measured at manufacturing cost. All other leased products are measured at acquisition cost. All leased products are depreciated using the straight-line method...

  • Page 84
    ... 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 end of the reporting period. Available-for-sale assets include financial assets, securities and investment fund shares...

  • Page 85
    ... depreciation and an appropriate proportion of administrative and social costs. Financing costs are not included in acquisition or manufacturing cost. Provisions for pensions and similar obligations are recognised using the projected unit credit method in accordance with IAS 19 (Employee Benefits...

  • Page 86
    ... general business environment. Estimates and underlying assumptions are checked regularly. Actual amounts could differ from those assumptions and estimates if business conditions develop differently to the Group's expectations at the end of the reporting period. Where new information comes to light...

  • Page 87
    ...An analysis of revenues by operating segment and geographical region is shown in the segment information on pages 129 - 131. 9 Cost of sales Cost of sales comprises: in euro million Manufacturing costs Warranty expenditure Cost of sales directly attributable to financial services Interest expense...

  • Page 88
    89 Group Financial Statements Cost of sales include euro 13,997 million (2007: euro: 11,024 million) relating to the financial services business. Manufacturing costs include impairment losses on intangible assets and property, plant and equipment of euro 3 million (2007: euro 17 million). Cost of ...

  • Page 89
    ... on stand-alone interest rate derivatives. The decrease in the fair values of these financial instruments reflected the change in the interest rate structure. 16 Income taxes Taxes on income comprise the following: in euro million Current tax expense Deferred tax expense Income taxes 2008 75...

  • Page 90
    ... taking account of the average multiplier rate (Hebesatz) of 410.0 % for municipal trade tax and the solidarity charge of 5.5 %, the overall tax rate for BMW companies in Germany is 30.2 % (2007: 38.9 %). This reduced rate was already applied in the financial year 2007 to measure deferred tax assets...

  • Page 91
    ... impact in 2008 is included on the line "Tax expenses / benefits for prior periods". The line "Variances due to different tax rates" includes a tax expense of euro 18 million relating to the revaluation of deferred tax assets and liabilities as a result of changed tax rates (2007: tax income of euro...

  • Page 92
    ... gaining work experience Average number of employees 95,699 6,034 101,733 2007 97,922 6,480 104,402 For information regarding the number of employees at the year-end, reference is made to pages 29 - 31 in the Group Management Report. The fee expense recognised in the financial year 2008 for...

  • Page 93
    ... Financial Statements Notes to the Balance Sheet 19 Analysis of changes in Group tangible, intangible and investment assets 2008 Acquisition and manufacturing cost in euro million 1.1. 20081 Translation differences - -11 -11 Additions Reclassifications - 13 13 Disposals 31.12. 2008 Development...

  • Page 94
    95 Group Financial Statements Depreciation and amortisation 1.1. 20081 Translation differences -2 -2 -4 Current year Disposals 31.12. 2008 Carrying amount 31.12. 2008 31.12. 2007 3,445 378 3,823 1,185 110 1,295 846 92 938 3,782 394 4,176 5,073 568 5,641 5,034 636 5,670 2,626 14,783 1,549 1 ...

  • Page 95
    ...are shown in the analysis of changes in Group tangible, intangible and investment assets on pages 94 - 95. Property, plant and equipment include a total of euro 68 million (2007: euro 102 million) relating to operational buildings used by BMW AG as well as leased plant, machinery and other equipment...

  • Page 96
    ... have, in part, extension and purchase options as well as price escalation clauses. Changes in leased products during the year are shown in the analysis of changes in Group tangible, intangible and investment assets on pages 94 - 95. 23 Investments accounted for using the equity method and other...

  • Page 97
    ... receivables from sales financing developed as following during the year under report: 2008 in euro million Balance at 1 January * Allocated / reversed Utilised Exchange rate impact and other changes Balance at 31 December Allowance for impairment recognised on a specific item basis group basis 672...

  • Page 98
    ... from sales financing at the end of the reporting period which have been renegotiated and which were otherwise overdue or otherwise required recognition of an impairment loss. 25 Financial assets Financial assets comprise: in euro million Interest and currency derivatives Marketable securities and...

  • Page 99
    ... value of the investment funds that exceeds the obligations for pre-retirement part-time work arrangements (settlement arrears) amounting to euro 35 million is reported under other financial assets. Allowance for impairment and credit risk Receivables relating to the credit card business comprise...

  • Page 100
    ... from other companies in which an investment is held are, as in the previous year, all due within one year. Prepayments of euro 848 million (2007: euro 729 million) relate mainly to prepaid interest, development costs not eligible for capitalisation as non-current assets, insurance premiums and...

  • Page 101
    ...672 Allowances on trade receivables developed as following during the year under report: 2008 in euro million Balance at 1 January Allocated / reversed Utilised Exchange rate impact and other changes Balance at 31 December Allowance for impairment recognised on a specific item basis group basis 38...

  • Page 102
    ... recognised directly in equity Net profit 2007 31 December 1007 Repurchase of treasury shares Dividends paid Translation differences Financial instruments Actuarial gains and losses on pension obligations Deferred tax on transactions recognised directly in equity Net profit 2008 Other changes 31...

  • Page 103
    ... Payments) to the employee share scheme was not material for the Group. At the Annual General Meeting of BMW AG on 8 May 2008, the shareholders again authorised the Board of Management to acquire treasury shares via the stock exchange, up to a maximum of 10 % of the share capital in place at the...

  • Page 104
    ... terms (equity attributable to shareholders of BMW AG as a percentage of total capital) was due to the higher funding requirements for financial services business. The BMW Group is officially rated by the rating agencies Standard & Poor's and Moody's. The long-term ratings for the BMW Group...

  • Page 105
    ... in estimates caused by the actual development of risks impacting on pension obligations and differences between the actual and expected return on plan assets. Past service cost arises where a BMW Group company introduces a defined benefit plan or changes the benefits payable under an existing plan...

  • Page 106
    ... 550 2 - 360 399 2007 243 537 -103 - 358 319 Germany in euro million Current service cost Expense from reversing the discounting of pension obligations Past service cost Expected return on plan assets (-) Expense from pension obligations 2008 117 209 -1 - 32 293 2007 150 192 -103 - 239 The expense...

  • Page 107
    ... fund assets compare with actuarial gains of euro 919 million (2007: euro 557 million) on benefit obligations. This offsetting effect was attributable primarily to the fact that the pension funds' investment strategy is based on the structure of the related benefit obligations. Germany The level of...

  • Page 108
    ... of plan assets is invested in debt securities in order to minimise the effect of capital market fluctuations. Other investment classes, such as stocks, serve to generate higher rates of return. This is necessary to cover in euro million Defined benefit obligation Fair value of plan assets Net...

  • Page 109
    ... expenses comprise mainly performance-related remuneration components, early retirement part-time working arrangements and employee long-service awards. Provisions for obligations for on-going operational expenses comprise primarily warranty obligations. 72 72 74 76 78 Group Financial Statements...

  • Page 110
    ... 536 million (2007: euro 647 million) for tax provisions. In 2008, tax provisions of euro 141 million were reversed (2007: euro 8 million). 35 Financial liabilities Financial liabilities include all liabilities of the BMW Group at the relevant reporting dates relating to financing activities and...

  • Page 111
    ... Equity Notes 79 Accounting Principles and Policies 88 Notes to the Income Statement Notes to the Balance Sheet 94 115 Other Disclosures 129 Segment Information BMW US Capital, LLC, Wilmington, Del. variable variable variable variable variable fixed fixed fixed fixed fixed Rolls-Royce Motor Cars...

  • Page 112
    ... 760 million EUR 1,895 million GBP 275 million USD 3,580 million Weighted average maturity period (in days) 24.8 40.2 30.7 25.0 Weighted average nominal interest rate (in %) 5.1 4.7 5.2 2.4 BMW AG, Munich BMW Finance N. V., The Hague BMW (UK) Capital plc, Bracknell BMW US Capital, LLC, Wilmington...

  • Page 113
    ... invested in the construction of the production plant in Leipzig. In accordance with IAS 20, they are recognised as income over the useful lives of the assets to which they relate. Other deferred income includes primarily the effects of the initial measurement of financial instruments. 37 Trade...

  • Page 114
    ... due later than five years Other financial obligations primarily under lease contracts for land, buildings, plant and machinery, tools, office and other facilities. The leases run for periods of one to 94 years and in some cases contain extension and / or purchase options. In 2008 an amount of euro...

  • Page 115
    ... 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 Cash and cash equivalents Trade receivables 72 72 74 76 78 Group...

  • Page 116
    117 Group Financial Statements Held-to-maturity investments Fair value Carrying amount Other liabilities Availablefor-sale Carrying amount * Fair valueoption Carrying amount * Held for trading Carrying amount * Cash flow hedges Carrying amount * Fair value hedges Carrying amount * Fair value...

  • Page 117
    ... amount 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 Cash and cash equivalents Trade receivables Other...

  • Page 118
    119 Group Financial Statements Held-to-maturity investments Fair value Carrying amount Other liabilities Availablefor-sale Carrying amount * Fair valueoption Carrying amount * Held for trading Carrying amount * Cash flow hedges Carrying amount * Fair value hedges Carrying amount * Fair value...

  • Page 119
    ... or losses arising on stand-alone derivatives. Write-downs of euro 123 million (2007: euro 49 million) on available-for-sale securities, for which fair value changes were previously recognised directly in equity, were recognised as expenses in 2008. Reversals of write-downs on current marketable...

  • Page 120
    ... in order to minimise the credit risk, all depending on the nature and amount of the exposure that the BMW Group is proposing to enter into. Within the financial services business, the financed items (e. g. vehicles, equipment and property) in the retail customer and dealer lines of business serve...

  • Page 121
    ... by the BMW Group. More detailed information regarding this methodology is provided in the section on accounting policies. The use of comprehensive rating and scoring techniques and credit monitoring procedures ensures the recoverability of the value of receivables from sales financing which are...

  • Page 122
    ... of its good credit standing, reflected in the first-class short-term ratings issued by Moody's (P-1) and Standard & Poor's (A-1), the BMW Group is also able to obtain competitive terms and conditions in this area. Also reducing liquidity risk, additional secured and unsecured lines of credit are in...

  • Page 123
    ... management system involves the use of standard financial instruments such as shortterm deposits, investments in variable and fixed-income securities as well as securities funds. The BMW Group is therefore also exposed to risks resulting from changes in interest rates. in euro million Euro US Dollar...

  • Page 124
    ... exchange rate fluctuations in 2008 was euro 44 million (2007: euro 47 million). The cash flows from investing and financing activities are based on actual payments and receipts. The cash flow from operating activities is computed using the indirect method, starting from the net profit of the Group...

  • Page 125
    ... includes close relatives and intermediaries. Significant influence over the financial and operating policies of the BMW Group can arise when a party holds 20 % or more of the shares of BMW AG or is a member of the Board of Management or Supervisory Board of BMW AG. For the financial year 2008, the...

  • Page 126
    ... and is also available to shareholders on the BMW Group website at www.bmwgroup.com/ir. 43 Shareholdings of members of the Board of Management and Supervisory Board The members of the Supervisory Board of BMW AG hold in total 27.70 % of the issued common and preferred stock shares, of which 16.12...

  • Page 127
    ... GmbH, Munich - BMW Vertriebs GmbH & Co. oHG, Dingolfing - Rolls-Royce Motor Cars GmbH, Munich 72 72 74 76 78 79 Group Financial Statements Income Statements Balance Sheets Cash Flow Statements Statement of Income and Expenses recognised in Equity Notes 79 Accounting Principles and Policies 88...

  • Page 128
    ... and sells BMW brand motorcycles as well as spare parts and accessories. The Financial Services segment focuses primarily on car leasing, fleet business, retail customer and dealer financing, customer deposit business and insurance activities. Holding and Group financing companies are included...

  • Page 129
    ... at 31 December 2008 included investments accounted for using the equity method amounting to euro 29 million (2007: -). The information disclosed for capital expenditure and depreciation and amortisation relates to property, plant and equipment, intangible assets and leased products. Segment figures...

  • Page 130
    ... disclosed for nonInformation by region current assets relates to property, plant and equipment, intangible assets and leased products. The reconciling item disclosed for non-current assets relates to leased products. External revenues in euro million Germany USA Non-current assets 2008 21,916 11...

  • Page 131
    ... 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 and the position of the Group...

  • Page 132
    ... of changes in equity, cash flow statement and the notes to the consolidated financial statements and its report on the position of the Company and the Group for the business year from 1 January to 31 December 2008. The preparation of the consolidated financial statements and Group Management Report...

  • Page 133
    ...the Board of Management Corporate Governance in the BMW Group Compliance in the BMW Group Compensation Report Declaration of the Board of Management and of the Supervisory Board pursuant to § 161 AktG Dr. Hans-Dietrich Winkhaus (until Deputy Chairman Former Chairman of the Board of Henkel AG & Co...

  • Page 134
    ... Board of Helmholtz-Zentrum Potsdam Deutsches GeoForschungsZentrum - GFZ University professor Allianz SE BASF SE (until 14. 01. 2008) Infineon Technologies AG MAN AG Willibald Löw * Chairman of the Works Council, Landshut Arthur L. Kelly (until . . ) Managing Partner...

  • Page 135
    ... * Regional Executive Officer of IG Metall Bavaria Mandates ZF Sachs AG (since 11. 09. 2008) 134 134 137 138 140 141 147 Corporate Governance Members of the Supervisory Board Members of the Board of Management Corporate Governance in the BMW Group Compliance in the BMW Group Compensation Report...

  • Page 136
    ... Supplier Network Ian Robertson (since Sales and Marketing Mandates Dr.-Ing. Klaus Draeger Development Rolls-Royce Motor Cars Limited (Chairman) Dr. Friedrich Eichiner Corporate and Brand Development (until Finance (since Mandates Allianz Deutschland AG (since 25. 04. 2008) BMW Brilliance...

  • Page 137
    ...of stakeholders, a fair and open approach towards employees and between Board of Management and Supervisory Board and compliance with the law. Information on the Company's governing constitution Bayerische Motoren Werke Aktiengesellschaft (BMW AG) is a stock corporation (Aktiengesellschaft) based on...

  • Page 138
    ... 2008, the Board of Management and Supervisory Board of BMW AG issued the current year's declaration of compliance with the new version of the GCGC valid from 8 August 2008 and posted to the BMW Group's website. The full text of the declaration is also provided on page 147 of the Annual Report. BMW...

  • Page 139
    ... culture and it is the reason why customers, shareholders, business partners and the general public place their trust in the BMW Group. The Board of Management and the employees of the BMW Group are obliged to act responsibly and in compliance with the law. This principle has been embedded in the...

  • Page 140
    .... Employees can use the website to access frequently asked questions (and related answers) on compliance-related issues. In the interest of investor protection and in order to ensure that the BMW Group complies with regulations relating to potential insider information, the Board of Management...

  • Page 141
    .... The amounts disclosed below as the annual pension provision allocation for each member corresponds to the pension service cost. Members of the Board of Management holding a credit card issued by BMW Bank GmbH, Munich, during the financial year 2008 had a credit line of up to euro 7,500 (2007...

  • Page 142
    ...case during the fourth quarter of the financial year 2007. In addition, an expense of euro 0.8 million (2007: euro 0.7 million) was recognised for current members of the Board of Management for post-employment benefits. This relates to the expense for allocations to pension provisions (service cost...

  • Page 143
    ... the member has attended (payable at the end of the financial year). Attendance at more than one meeting on the same day is not remunerated separately. The Company also reimburses to each member of the Supervisory Board any value added tax arising on their remuneration. The amounts disclosed below...

  • Page 144
    ... period of office during the financial year. Member of the Supervisory Board until 15 February 2008 3 Deputy Chairman of the Supervisory Board from 13 March 2008 4 Deputy Chairman of the Supervisory Board from 8 May 2008 5 Member of the Supervisory Board until 8 May 2008 6 Member of the Supervisory...

  • Page 145
    ... further information on the BMW Group's business (including financial publications) is available on the Group's website at www.bmwgroup.com/ir. 134 134 137 138 140 141 147 Corporate Governance Members of the Supervisory Board Members of the Board of Management Corporate Governance in the BMW Group...

  • Page 146
    ... in order to increase the efficiency of the Supervisory Board's work in personnelrelated matters. The Supervisory Board is informed regularly and in detail of the work of the Personnel Committee. Munich, December 2008 Bayerische Motoren Werke Aktiengesellschaft Supervisory Board Board of Management

  • Page 147
    ... the closing rate. 3 profit and loss transfer agreement with BMW AG 4 profit and loss transfer agreement with a subsidiary of BMW AG 5 below euro 500,000 2 148 148 150 152 154 156 158 159 160 Other Information BMW AG Principal Subsidiaries BMW Group Ten-year Comparison BMW Group Locations Glossary...

  • Page 148
    ... Mexico City BMW (US) Holding Corp., Wilmington, Del. BMW Manufacturing, LLC, Wilmington, Del. BMW Financial Services NA, LLC, Wilmington, Del. BMW of North America, LLC, Wilmington, Del. BMW US Capital, LLC, Wilmington, Del. Equity in euro million Net result in euro million Capital investment in...

  • Page 149
    ... Revenues Gross profit margin Group 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 Non-current assets Current assets Equity Equity ratio Group Non-current provisions...

  • Page 150
    151 Other Information 2006 IASs / IFRSs 2005 IASs / IFRSs 2004 IASs / IFRSs, adjusted 1 2003 IASs / IFRSs 2002 IASs / IFRSs, adjusted 2 2001 IASs / IFRSs 2000 IASs / IFRSs 2000 HGB ...

  • Page 151
    ... with 24 production and assembly plants, 41 sales subsidiaries and a research and development network. 148 148 150 152 154 156 158 159 160 Other Information BMW AG Principal Subsidiaries BMW Group Ten-year Comparison BMW Group Locations Glossary Index Index of graphs Financial Calendar Contacts...

  • Page 152
    ... -S -S -S -S -P Production Berlin plant Dingolfing plant Eisenach plant Goodwood plant, GB (headquarters of Rolls-Royce Motor Cars Limited) Hams Hall plant, GB Landshut plant Leipzig plant Munich plant Oxford plant, GB Regensburg plant Rosslyn plant, South Africa BMW Brilliance Automotive Ltd...

  • Page 153
    ...from operating activities of the Automobiles segment less the cash outflow for investing activities of the Automobiles segment. Gross margin Gross profit as a percentage of revenues. IASs International Accounting Standards. IFRSs International Financial Reporting Standards, intended to ensure global...

  • Page 154
    ...: Profit before tax as a percentage of revenues. Post-tax: Profit as a percentage of revenues. Risk management An integral component of all business processes. Following enactment of the Law on Control and Transparency within Businesses (KonTraG), all companies listed on a stock exchange in Germany...

  • Page 155
    ... method and other investments 97 K Key data per share 148 148 150 152 154 156 158 159 160 Other Information BMW AG Principal Subsidiaries BMW Group Ten-year Comparison BMW Group Locations Glossary Index Index of graphs Financial Calendar Contacts 43 L Lease business 27 - 28, 63 Leased products...

  • Page 156
    ..., 96, 152, 155 Research and development costs 49 - 50, 60, 73, 77, 89 - 90, 96 Result from equity accounted investments 50, 130 Return on sales 31, 50, 57, 70 - 71, 142, 151, 155 Revenue reserves 59, 75, 104 Risk management 09, 11, 62, 65, 123, 155 This version of the Annual Report is a translation...

  • Page 157
    ... retail customer financing of BMW Group Financial Services 2008 28 Regional mix of BMW Group purchase volumes 2008 39 Change in cash and cash equivalents 52 Balance sheet structure - Automobiles segment 54 Balance sheet structure Group 54 BMW Group Value added 2008 55 Production and sales volume...

  • Page 158
    ... Other Information Financial Calendar Annual Accounts Press Conference Financial Analysts' Meeting Quarterly Report to 31 March 2009 Annual General Meeting Quarterly Report to 30 June 2009 Quarterly Report to 30 September 2009 Annual Report 2009 Annual Accounts Press Conference Financial Analysts...

  • Page 159
    ... the various BMW Group brands is available at www.bmw.com, www.mini.com and www.rolls-roycemotorcars.com 148 148 150 152 154 156 158 159 160 Other Information BMW AG Principal Subsidiaries BMW Group Ten-year Comparison BMW Group Locations Glossary Index Index of graphs Financial Calendar Contacts

  • Page 160
    161 Other Information The manufacture of, and the paper used for, the BMW Group's Annual Report 2008, 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 ...

  • Page 161
    Number ONE Future Growth Customers Profitability The challenge of the future

  • Page 162
    ... the 21st century, but to realise it. Only the best ideas and concepts will succeed: concepts which align our own needs with those of our customers and with the challenges society faces - and in doing so create a new state of balance that will benefit us all. The challenge of the future

  • Page 163
    04 Norbert Reithofer Chairman of the Board of Management

  • Page 164
    ... to achieve the second-best sales figures in our company's history. In fact, MINI was one of the few automotive brands that reported growth in 2008. Our motorcycle business also performed well and almost matched the previous year's high level, with sales of 101,685 BMW motorcycles. Nevertheless, the...

  • Page 165
    ..., we were still able to close the year with positive earnings. At the same time, we also achieved a great deal during 2008: We made great strides in implementing Strategy Number ONE, which gives us a significant competitive edge and provides a clearly formulated vision. We took decisive action early...

  • Page 166
    ... And we want our future to be a successful one! We have substantially increased productivity in manufacturing our vehicles. In the process we also cooperated with the BMW Group Works Council in the reduction of our workforce. We took important steps in this direction at an early stage, and - what is...

  • Page 167
    ...work extremely hard this year and to use every means available to emerge as a winner from the crisis in our industry. There is no denying that the crisis has filtered into people's minds, but we at the BMW Group like to think differently: We will look to the future, and that will assure our position...

  • Page 168
    .... A balance between individual demands and ecological necessities; between familiar approaches and new ideas; between success and responsibility. All of our future decisions will be measured against these standards - that is how we will create the mobility of tomorrow. The challenge of the future

  • Page 169
    The challenge of the future An age is dawning in which sustainability will shape our values. In which a paradigm shift will redefine the future of individual mobility. Our goals are clear. And we will consistently realise them.

  • Page 170
    Strategy Number ONE MINI E Target Shaping future mobility project i Focussing on solutions Challenges: Megacities

  • Page 171
    More than 3,000 dealers worldwide Innovative service products Target 20 % increase from after-sales business by 2014 Service that spans a vehicle's lifetime Potential: over 14 million BMW Group vehicles on the road

  • Page 172
    Active safety systems Integrated safety: so that accidents don't have to happen Driver assistance systems Passive safety systems

  • Page 173
    Wastewater-free production Waste prevention Target - 30 Energy efficiency % resource consumption per vehicle produced by 2012 CO2 reduction Clean Production

  • Page 174
    The challenge of the future Re-evaluating past ideas. One thing is certain: Premium will always be premium. And yet still reinvent itself.

  • Page 175
    The challenge of the future This is how we create vehicles that redefine the premium concept. Based on technological innovation - and the efficient and responsible use of resources.

  • Page 176
    Redefining premium Visionary thinking Focussing on individuals Making efficiency key Going our own way Promoting creativity

  • Page 177
    Act responsibly Recognise mobility needs Rethink mobility Living sustainability Demonstrate leadership

  • Page 178

  • Page 179
    Master future challenges Create fascination Safeguard profitability Keep thinking

  • Page 180
    The challenge of the future Our vision: to be the leading supplier of premium products and premium services for individual mobility.

  • Page 181
    The challenge of the future

  • Page 182
    ...of the future 04 09 Topic Future one project i - reinventing urban mobility 24 Topic two Growth Service that spans a vehicle's lifetime Topic 32 three Customers Integrated safety Topic 46 four Profitability Clean Production Topic 56 five New products 68 Topic six The year 2008 80

  • Page 183
    ... one Ensuring individual mobility in the major cities of tomorrow requires setting totally new solutions in motion today. It means developing not only fuel-saving drive technologies, but also new vehicles and mobility services. It means being prepared to question everything, even our own way of...

  • Page 184
    ... i 25 Autumn 2007 Strategy Number ONE adopted Example: Bangkok. Traffic researchers have found that drivers in Thailand's capital city now travel at no more than 15 kilometres an hour during rush hour. Traffic jams are so common in this city of seven million that its traffic police recently had to...

  • Page 185
    ... as part of the Group's corporate strategy Number ONE. Its mission is nothing less than to completely rethink mobility for people who live in the world's metropolitan areas - and that includes everything from vehicle concepts to production structures through to branding and service strategies. The...

  • Page 186
    ... Topic one Future project i 27 Inhabitants: 7.5 million Inhabitants per square kilometre: 4,800 Challenge: London City centre toll: 8 pounds / day Vehicles in the toll zone: 130,000 / day April 2008 First prototype of the MINI E Inga Jürgens Head of Planning and Control project i Munich

  • Page 187
    ... electric-powered vehicle climate-neutral to drive," explains Joachim Kolling (44), the project i team's design head, "when you drive right into the city centre, it also produces zero emissions. And, in the future, that will be increasingly necessary to enter mega-cities at all." November 2008 MINI...

  • Page 188
    ... Mexico City Inhabitants in the metropolitan area: 20 million Inhabitants per Annual growth in inhabitants: up to 1 million Minibus traffic: 55 % square kilometre: 5,800 CO2 emissions from road traffic: 99 % Average age of vehicles: 15 years Dr. Joachim Kolling Head of Design and Creative Processes...

  • Page 189
    ... thousand Americans applied to drive a MINI E despite the relatively high lease rate of 850 dollars a month. The MINI E is an extremely valuable "trial balloon on four wheels" for the project i team. "We hope this project will provide us with important insight as to how customers use an electric car...

  • Page 190
    ... number of electric cars to battery-charging stations for recharging at night, the fleet of E-vehicles would work as a kind of gigantic, networked battery. Electric vehicles would store the green energy as soon as it was generated - helping to solve one of the central problems of regenerative power...

  • Page 191
    ...more than  million BMW Group vehicles on the roads today - which means there are more than  million potential service customers. For this reason the company is launching a global initiative which will systematically exploit the huge sales potential of the service and parts business - and...

  • Page 192
    ... the BMW Group's point of view, after-sales service not only means satisfied customers, but also translates directly into sales and profitability, since parts, accessories and services have such tremendous growth potential. To make better use of this potential, the BMW Group has launched a global...

  • Page 193
    ... and winning new customers in the process. That is why one of the steps currently being taken is to set up highly modernised "Dealer Metro Distribution Centres" in  major cities around the world, where dealers in that region will be able to access the to most essential BMW and MINI parts...

  • Page 194
    ... whole life. Meet some of our long-time BMW and MINI drivers with their vehicles in everyday situations on the following pages. At the same time, the range of products offered - as well as the positioning and advertising of the parts and services business - will be systematically expanded. The goal...

  • Page 195
    36 Vehicle BMW 3 Series Touring Purchased 2008 Total distance travelled 1,750 km Longest route BMW Welt Munich-Walldorf

  • Page 196
    ... of the future Topic two Growth Customer service 37 Percentage of automotive customers who already changed their brand of car because of poor service 15 % Dr. Lutz Bergau Aviation doctor Alaska fan Dr. Maren Rehfeld-Bergau Paediatrician Alaska fan BMW drivers since 1977 First BMW BMW 2002

  • Page 197
    38 Real estate agent Jan Hendrik Schönfeld MINI driver since 2001 First MINI MINI Cooper

  • Page 198
    The challenge of the future Topic two Growth Customer service 39 Vehicle MINI Cooper S Convertible Purchased 2007 Total distance travelled 43,000 km Longest route Hanover-Milan-Hanover

  • Page 199
    40 Vehicle BMW 3 Series Purchased 2008 Total distance travelled 9,000 km Longest route Muelheim-Tuscany-Muelheim

  • Page 200
    The challenge of the future Topic two Growth Customer service 41 Percentage of sales generated by after-sales business in the German automotive industry 50 % Ghias Al-Tinawi Internist BMW driver since 1983 First BMW BMW 316

  • Page 201
    42 Alice Fiedler Marketing MINI driver since 2001 First MINI MINI Cooper

  • Page 202
    The challenge of the future Topic two Growth Customer service 43 Vehicle MINI Cooper S Passenger Pina Purchased 2007 Total distance travelled 22,000 km Longest route Frankfurt-Meran-Frankfurt

  • Page 203
    44 Vehicle BMW X5 Purchased 2008 Total distance travelled 12,000 km Longest route Bremen-Gibraltar Percentage of sales generated by after-sales business in the German automotive industry 23 %

  • Page 204
    The challenge of the future Topic two Growth Customer service 45 Thomas Greppmair Currency trader BMW driver since 1977 First BMW of 14 BMW 316 Overall distance travelled 1 million kilometres

  • Page 205
    ... brakes. Adaptive headlights. Systems that can see in the dark. Vehicles that can detect a collision before it happens: Active safety systems in BMW Group vehicles open up a whole new dimension in automotive safety. A new concept of safety. Smart prevention. Saving lives. Active and passive...

  • Page 206
    ...three Access to technologies and customers Safety 47 a b Image a b Klaus Kompaß After the crash Head of vehicle safety at the BMW Group. The new BMW 7 Series after a side impact at more than 56 km / h. 14 million passenger cars in Germany 1970 46 million passenger cars in Germany 2007

  • Page 207
    ... seating A dummy is lifted into the vehicle by a crane. The dummy weighs more than 80 kilograms. The dummy's exact seating position is crucial to readings. A dummy can record 10,000 measurements per second. 201 billion kilometres driven by cars in Germany 1970 692 billion kilometres driven by...

  • Page 208
    ... crash tests. Then there are additional tests to make sure it meets the BMW Group's own high safety standards. The company has been researching the causes of accidents and the most effective ways of dealing with them for more than 30 years. Developers have endowed the Group's vehicles with energy...

  • Page 209
    ...-and-a-half times brighter than the desert at noon - 14 high-speed cameras need plenty of light. On your marks Measuring acceleration over a 130-metre track (longer than a football pitch). Test in progress Heading straight for the "tree" at 56 km / h - the standards for passive safety are extremely...

  • Page 210
    The challenge of the future Topic three Access to technologies and customers Safety 51 11.7 21.2 minutes average rescue time outside of town with BMW ConnectedDrive minutes average rescue time outside of town without BMW ConnectedDrive d

  • Page 211
    ... of accidents the BMW Group already has effective driver assistance systems on the market or in development. accidents. 41 percent = driving Standard features: - lane departure warning - high beam assistant - adaptive cornering lights - active steering In research or development phase: - curve...

  • Page 212
    ... speed limit as well as for the lane departure warning and the high beam assistant. The 7 Series' integrated chassis management also interfaces with the transmission shift characteristics, power-steering assist, integral active steering, accelerator pedal response and dynamic damping control...

  • Page 213
    ...with Side View. The new BMW Night Vision detects pedestrians. Research for the future The crossroads assistant uses vehicle-to-vehicle communications. Accident type 3: 18 percent = crossing accidents. Standard features: - Side View - bending light - ABS, brake assistant BMW developers are always...

  • Page 214
    ...the future Topic three Access to technologies and customers Safety 55 c Accident type 4: 10 percent = accidents involving pedestrians. Standard features: - pedestrian detection - Night Vision - ABS, brake assistant In research or development phase: - active emergency braking Of course, even...

  • Page 215
    ... its global production network: year after year, plant by plant. From 200 to 202 water, energy, CO2 emissions, waste and solvent emissions will all be reduced by no less than 30 percent - with tangible benefits for the environment as well as for the company's earnings. Reduce costs. Save...

  • Page 216
    ... been highly rated in this definitive global sustainability index from the very start. In fact, over the past four years the company has consistently ranked number one in its sector. This makes the BMW Group the world's most sustainable automobile manufacturer. The innovations implemented as part of...

  • Page 217
    ...instance, American production engineers in the body shop at the Spartanburg plant developed an adhesive that works without the previously necessary 120-degree Celsius heat drying process. Hence Spartanburg was able to avoid not only investing in a body shop dryer but also made huge energy savings in...

  • Page 218
    ... an average of five percent per year. A global benchmarking system allows all plant managers to see how well they are managing resources at any time compared with other BMW Group sites. Most importantly, they can call upon the experience and expertise of the best-performing location to help optimise...

  • Page 219
    ... grounds of the BMW plant in Spartanburg use methane gas to produce electricity and hot water. A pipeline more than  km long supplies the BMW plant in Spartanburg with methane gas. The power supply centre constantly monitors whether all systems are generating energy properly. Waste materials...

  • Page 220
    ... using methane gas from a nearby landfill to supply its paint shop with power. Today the plant uses methane to meet around 63 percent of its energy requirements, cutting CO2 emissions by an amount equal to the energy needed to heat and cool about 15,000 American households over a year. The BMW Group...

  • Page 221
    ... of new vehicles stood here. The vehicles are delivered to their new owners worldwide in closed freight cars. Today more than half of all the BMW Group's new vehicles leave the plant by rail. a Example 02 Topic: Surface protection Plant: Regensburg, Germany Solvent emissions: 70 tons less in 2008

  • Page 222
    ...2008 Paint is as much a part of car building as sheet steel and engines. Many paints contain solvents that pose health and environmental concerns. That is why the BMW Group uses water-based paints with low solvent content or completely solvent-free powder-based paint technology at all company sites...

  • Page 223
    ... part is perfectly packed - and the same packaging can be used over and over again. 13,5 million reusable containers are in circulation between the BMW Group and its suppliers. a b Example 03 Topic: PVC waste Plant: Munich, Germany PVC waste: minus 80 % Waste for disposal: 100 tons less in 2008

  • Page 224
    ... plant's paint shop, for instance, the pre-treatment process for bodies awaiting painting has been optimised to eliminate 80 % of the PVC waste from the underbody coating process. But even residual waste can perform a useful function: As fuel for heat and power plants it helps conserve fossil energy...

  • Page 225
    ... of all BMW engines. Using a completely new combination of different membrane technologies all of the plant's process wastewater is processed and fed back into production. a b Example 04 Topic: Water and wastewater Plant: Steyr, Austria Wastewater: zero litres Savings: up to 30 million litres per...

  • Page 226
    ... system was closed off in late 2006, the plant has only drawn fresh water to compensate evaporation losses. It means the plant uses up to 30 million litres less water annually - about the same amount a small town of about 750 people uses. Across the BMW Group the quantity of process wastewater per...

  • Page 227
    ...BMW Group's three brands, BMW, MINI and Rolls-Royce, are among the automotive industry's strongest premium brands. A wide range of new models released in 2008 once again illustrates the innovative power and performance of the BMW Group. Setting milestones. Creating fascination. New products in 2008...

  • Page 228
    ... five New products 69 BMW 1 Series Convertible The BMW 1 Series Convertible combines the pleasure of open-top driving with unbeatable fuel efficiency. To take an example: The 118d Convertible has an average fuel consumption of . litres per  kilometres in the EU Test Cycle and CO2...

  • Page 229
    70 BMW M3 Convertible The BMW M3 Convertible combines outstanding driving dynamics with aesthetic looks to offer a unique driving experience - in a car that is ideally suited to everyday driving. This fourth generation of the M3 Convertible made its world debut at the Geneva Motor Show in March

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    The challenge of the future Topic five New products 71 BMW 3 Series Touring The BMW 3 Series is the epitome of sportiness in its class and has occupied the top slot as the world's bestselling premium vehicle for years. The BMW 3 Series is set to increase its lead with revised versions of the ...

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    ... the benchmark: The fifth generation of the BMW 7 Series luxury sedan shows how to combine driving pleasure with spacious opulence. The new BMW 7 Series is the product of stylish design and exceptional engineering in drive train, chassis, safety, driver assistance systems and comfort functions.

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    The challenge of the future Topic five New products 73

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    74 BMW X6 The BMW X6, the world's first Sports Activity Coupé, draws its fascination from characteristics and abilities no other vehicle offers in a format of this kind. Its design unites the sporty elegance of a large BMW Coupé with the strength and presence of the BMW X models.

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    The challenge of the future Topic five New products 75

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    ...new K 1300 S is currently the fastest, most powerful BMW series-production motorcycle available. It combines top performance with outstanding allround characteristics and active safety features such as BMW Integral ABS, Anti-Slip Control (ASC) and ESA II Electronic Suspension Adjustment as standard.

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    ... challenge of the future Topic five New products 77 MINI John Cooper Works A big name backed by a long tradition, excellent performance data and an unforgettable driving experience: The MINI John Cooper Works is sporty to the extreme and takes the passion for motor sports beyond the racetrack.

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    ... The Rolls-Royce Phantom Coupé is the fourth and most recent addition to the Rolls-Royce Motor Cars product range. A particularly light and extremely rigid aluminium chassis guarantees optimum safety, while the tried-and-tested .-litre V engine supplies its high-performance drive train...

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    The challenge of the future Topic five New products 79

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    80 Topic six In review. The pulsation of the BMW Group. The year 2008.

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    ...at the company's first plant in Munich, before production moved to the newly opened BMW plant in Dingolfing in the autumn of New generations came along in and and in the current generation was born. Top German Design Award for the BMW Group The BMW Group receives the Federal Republic of Germany...

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    ...of the BMW M1 super sports car, the BMW Group unveils a design study that pays tribute to this legendary model at the Concorso d'Eleganza Villa d'Este The BMW M1 was a superlative car, and a highly emotive vehicle that was uncompromisingly primed for the race track. This development originated from...

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    ... museum is designed not only to showcase exceptional automobiles and motorcycles from past decades, but also to reflect the dynamism and innovative power of the BMW brand and the company. Between the museum's reopening and the end of the year the BMW Group welcomed no less than visitors. 19, 2008

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    .... The BMW Group is the only company in its industry to have been listed in this important collection of corporate sustainability indexes every year since they were established in The SAM Group analyses the economic, environmental and social performance of approximately companies and selects the...

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    ... Anyone living in the metropolitan areas of California or New York interested in driving a MINI E was able to apply online. Feedback from the field trial will be incorporated in series development projects at a later stage. The BMW Group's By -gram fleet the end of the BMW Group's product...

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    ... 118d 3-door Fuel consumption CO2 emissions 4.5 l 119 g MINI Cooper Fuel consumption CO2 emissions 5.4 l 129 g MINI Cooper D Fuel consumption CO2 emissions 3.9 l 104 g MINI One Clubman Fuel consumption CO2 emissions 5.4 l 130 g Consumption and emission data The 140-gram fleet for the BMW Group

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    ... CO2 emissions 5.3 l 128 g MINI Cooper D Clubman Fuel consumption CO2 emissions 4.1 l 109 g MINI Cooper Clubman Fuel consumption CO2 emissions 5.5 l 132 g MINI Cooper Convertible Fuel consumption CO2 emissions 5.7 l 137 g Consumption data in litres /100 km in the EU test cycle, CO2 emissions in...

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    ... Urban (l / 100 km) Extraurban (l / 100 km) Combined (l / 100 km) CO2 emissions [g / km] BMW BMW 116i 3-door 6 118i 3-door 6 120i 3-door 6 130i 3-door 116d 3-door 1 118d 3-door 4, 7 120d ... 260 (246) 136 (149) 165 (172) 179 (183) Vehicle fleet Consumption and emission data for the BMW Group

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    ... on right-hand drive vehicles vary. Further information and constantly updated data for the vehicles is available on the Internet at www.bmw.com, www.mini.com and www.rolls-roycemotorcars.com. as of March Values measured in accordance with the New European Drive Cycle (EU Directive EEC in the...

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    ...Group's Annual Report 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 infringements and damage to the environment. Since products...