BMW 2011 Annual Report Download - page 36

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Purchasing and Supplier Network developed further
Throughout 2011 we continued the process of globalis-
ing
our supplier network. Alongside the issue of secur-
ing supplies, we also focused on parts quality. Having
organisational structures in place that effectively bundle
responsibility for purchasing, logistics and parts quality
enables us to successfully secure supplies for produc-
tion with greater efficiency, even when working at full
capacity. Tight networking with our suppliers is seen as
a key issue, particularly regarding access to innova-
tions. With this in mind, in autumn 2011 we created the
Supplier Innovation Award to honour outstanding
in-
novation in our vehicles. The award is intended to em-
phasise
the fact that innovative strength is a key factor
in the continued success of the BMW Group.
Numerous model start-ups during the reporting year
2011 again saw a large number of model start-ups.
We continued to internationalise our supply chain,
particularly with the new BMW 6 Series Coupé, the
ActiveHybrid 5, the M5 and the 1 Series M Coupé. In
this endeavour we were again successful in improving
our cost base and the quality of supplies. An important
step in the direction of electromobility and BMW i was
taken with the production start of the BMW ActiveE
test fleet.
Making use of international procurement markets
Our purchasing activities in Asia, and particularly in
China, have been expanded prior to the opening of the
new production plant in Tiexi*, China. To this end we
set up our own organisational unit in China with re-
sponsibility for purchasing, logistics and quality. Simul-
taneously we broadened our purchasing activities for
future vehicle projects in Europe and the NAFTA region.
In doing so, we always give particular consideration to
local partners present in the various production markets.
This approach is seen as an important way of hedging
currency risk. Multi-currency ordering enables us to pay
for the various elements in the value-added chain in the
relevant foreign currencies.
* Joint Venture BMW Brilliance
Productivity and technological edge in manufacturing
Production processes at the BMW Landshut plant were
further optimised in 2011 and value streams designed
to achieve even greater efficiency. In recognition of the
improvements achieved, the Landshut plant was pre-
sented with the Lean Production Award 2011 for the best
value-added chain.
PURCHASING
Production capacities for CFRP components at the Leip-
zig and Landshut plants were additionally expanded in
preparation for the vehicle projects relating to the BMW i
sub-brand. We also raised production capacities at the
BMW Leipzig plant for plastic outer skin components.
With both of these moves we are creating integrated
production structures that deliver high levels of added
value for the sites involved.
Sustainability in the value-added chains
Adherence to the BMW Group’s high ecological and
social standards was again a key criterion in selecting
suppliers in 2011. The main focus was on monitoring
the production locations of our suppliers worldwide.
The high standards that we apply were recognised again
in 2011 by inclusion in the Dow Jones Sustainability
Index, in which the BMW Group is one of the top three
in the Supply Chain category.
18 COMBINED GROUP AND COMPANY
MANAGEMENT REPORT
18 A Review of the Financial Year
20 General Economic Environment
24 Review of Operations
24 Automotive segment
29 Motorcycles segment
31 Financial Services segment
33 Research and development
36 Purchasing
37 Sales
38 Workforce
40 Sustainability
43 BMW Stock and Capital Market
46 Disclosures relevant for takeovers
and explanatory comments
49 Financial Analysis
66 Internal Control System and
explanatory comments
67 Risk Management
73 Outlook
Regional mix of BMW Group purchase volumes 2011
in %, basis: production material
Germany 51
Central and Eastern Europe 11
Rest of Western Europe 18 Asia / Australia 4
NAFTA 13 Africa 3
Germany
Central and Eastern Europe
Rest of Western Europe
NAFTA
Asia / Australia Africa