BMW 2010 Annual Report Download - page 38

36
12 GROUP MANAGEMENT REPORT
12 A Review of the Financial Year
14 General Economic Environment
18 Review of Operations
41 BMW Group – Capital Market
Activities
44 Disclosures relevant for takeovers
and explanatory comments
47 Financial Analysis
47 Internal Management System
49 Earnings Performance
51 Financial Position
53 Net Assets Position
55 Subsequent Events Report
55 Value Added Statement
57 Key Performance Figures
58 Comments on BMW AG
62 Internal Control System and
explanatory comments
63 Risk Management
70 Outlook
Research and development expenditure increased
The BMW Group employed over 9,000 people in its
research and innovation network at eleven sites in five
countries during the year under report. Expenditure
forresearch and development in 2010 rose by 13.3%
toeuro 2,773 million. The research and development ra-
tio of 4.6% was 0.2 percentage points lower than in the
previous year. Further information on research and
development activities is provided in the notes to the
Group Financial Statements (Note 8).
Innovative and sustainable
The continuous search for efficient solutions to reduce
the emissions levels of our fleet is an essential driving
force for our research and development activities. For
this reason, we are committed to achieving maximum
improvements with our Efficient Dynamics package of
measures.
Above all, a switch to electrically powered cars will have
a positive impact on the carbon footprint as soon as the
energy used is also generated on a renewable basis. New
drive concepts based on hybrid and electric power, and
in the long term hydrogen power, will become increas-
ingly important.
We are currently developing a completely new concept
for sustainable mobility in urban areas. The electrically
powered Megacity Vehicle (MCV) is equipped with a
newly developed drive system as well as a revolutionary
vehicle architecture that combines consistent lightweight
construction, optimal space functionality and the highest
standard of safety. The MCV will be launched as a series-
manufactured vehicle in the premium segment in 2013.
Focus on benefits for the customer
One of the key aspects of our strong competitive position
is our ability to offer customers recognisable added value
with innovative technologies, including, first and
fore-
most, our innovative Efficient Dynamics package of meas-
ures.
Efficient Dynamics, which combines all of the effi-
ciency measures we have achieved in engine technology,
energy management, lightweight construction and aero-
dynamics,
has enabled us to win pole position in the pre-
mium segment in recent years in terms of fuel economy.
Connected Drive is the second core theme in the develop-
ment of innovative technologies and incorporates all
aspects of information flows relating to the vehicle. Its
range of features not only includes the services BMW
Assist and BMW Online, but numerous other systems
that provide additional convenience, information and
entertainment as well as safety through interconnected-
ness. The Lane Change Warning and Lane Departure
Warning systems, speed limit information, BMW Night
Vision with pedestrian recognition, reversing camera
including Top View and the parking assistant are some of
the features that are offered. We also optimise the inte-
gration ofinnovative end devices, such as smart phones
and music players. Alongside access to the Internet,
Connected Drive also enables the display of e-mails
received by smart phone as well as the use of Internet-
based services for navigation and infotainment.
In the new BMW 6 Series Convertible, available from
spring 2011, the new generation of Head-Up Display will
be a feature for the first time. The system projects key
information onto the windscreen directly in the driver’s
field of vision. The presentation of the three-dimension-
ally displayed graphics covers the entire colour spectrum,
enabling traffic signs to be realistically displayed.
Energy and environmental technology test centre
opened
In May 2010 we opened the new Energy and Environ-
mental Test Centre (EVZ) in Munich. Right from the
planning stage the centre was designed to operate in an
ecologically sustainable way. In this completely new
simulation centre, innovations are tested in a wide range
of varying climatic conditions prior to their use in se-
ries production. The new facility enables us to recreate
realistic simulations of key environmental conditions
such as temperature fluctuations, air humidity, air pres-
sure, precipitation and wind, thereby avoiding costly and
elaborate testing in countries with hot and cold climates.
The strategy reduces both time and costs for transpor-
tation and also means that fewer prototypes can be used
for a greater number of trials. Furthermore, the concen-
tration of the various test series under one roof regard-
less of seasonal weather conditions makes test results far
more quickly available.
Taking opportunities together
In 2010 the BMW Group and the PSA Group decided to
extend the long-standing cooperation arrangements
already inplace for the
development and production of
hybrid systems. The BMW
Group and PSA Peugeot
Citroën
additionally signed an agreement to establish a
joint venture
in February 2011. The first priority of the
initiative entered into by the two companies is to de-
velop standardised components for use in the electrifica-
tion of the respective vehicle fleets. Joint research,
de-
velopment, production and component procurement will
mean significant cost benefits for both groups.