Key points of BMW's strategy update

By Reuters News

FRANKFURT, Sept 30 (Reuters) - BMW BMWG.DE is holding a two-day capital markets event to brief investors about the premium carmaker's strategy, the first for new CEO Milan Nedeljkovic, who took over in May.

Here are the main points of the update:

TARGETS

- The group aims for an 8% to 10% automotive profit margin by the start of the next decade and automotive free cash flow of more than €7 billion ($8 billion). That compares with 2026 targets of 1% to 3% and more than €2.5 billion, respectively

- In 2028, the group expects an operating margin of 3% to 5% as an interim target, with free cash flow of more than €5 billion

- The group plans to reduce model variants across its portfolio, and there will be no successor to the BMW2 Series Active Tourer

- By mid-2027, BMW will cut the number of divisions and related management roles by 20%, "with a comparable reduction at the organisational levels below"

CHINA

- In China, local production of high-volume categories will be expanded, while imports will be limited to models with the highest profit margins

- BMW aims to raise the share of locally manufactured vehicles specifically tailored to Chinese customer preferences to at least 95% by 2030. The current level is "just under 90%", it said

- BMW is considering expanding exports of vehicles made in China to Southeast Asian markets


US

- BMW plans to expand its luxury SUV offering with a new model positioned above its current top-end BMW X7 series

- With its Spartanburg plant in South Carolina operating at full capacity due to the popularity of luxury SUVs, BMW is striving for "greater regionalisation" to expand global production of these models in other sales regions

EUROPE

- BMW plans to introduce a new entry-segment fully electric model from the Neue Klasse range in 2028

ARTIFICIAL INTELLIGENCE

- BMW plans to significantly expand the role of AI in its value chain

- In future, AI is expected to provide end-to-end support, from "initial technical requirements to testing and release"

AUTONOMOUS DRIVING

- BMW will offer navigation-guided driver assistance in Germany based on the DCAS regulation, with other countries following in stages, such as the US

CRITICAL MATERIALS

- The company will focus on new partnerships, including with competitors within the European Union, to secure supplies of critical raw materials and components, including semiconductors

($1 = 0.8807 euros)

Capital.com is an execution-only brokerage platform and the content provided on the Capital.com website is intended for informational purposes only and should not be regarded as an offer to sell or a solicitation of an offer to buy the products or securities to which it applies. No representation or warranty is given as to the accuracy or completeness of the information provided.

The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance.

To the extent permitted by law, in no event shall Capital.com (or any affiliate or employee) have any liability for any loss arising from the use of the information provided. Any person acting on the information does so entirely at their own risk.

Any information which could be construed as “investment research” has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.