Business Strategy BMW

Topics: Automotive industry, BMW, General Motors Pages: 11 (3463 words) Published: September 22, 2014
1.Cover sheet
2.Executive summary
3.Table of Contents
5.Strategic analysis
6.Strategic directions
7.Key strategies
8.Strategic implementation
9.Key strategic implementation issues
10. Evaluation of strategy
12. References
13. Appendix

The automotive industry is one of the most competitive industries in the market. Companies that get into the automotive industry are faced with high cost prices in production and highly competitive firms. Bayerische Motoren Werke AG (English: Bavarian Motor Works) with headquarter in Munich is one of them. Founded 1916 as a producer of aircraft engines BMW is one of the ten largest car manufacturers in the world today. The company operates in three business segments: automobiles, motorcycles and financial services. However the core business is still the production of cars. In that segment BMW is focused at the premium and luxury sector where it is is one of the leading car manufacturers with the aim to achieve profitable growth and become the number one in next few years. The global acting company had a business volume of 53,7 billion Euro in the year 2009. Currently 96.000 employers work at 17 different production places all over the world for BMW. In last year the BMW Group sold 1.3 million cars of its three non-overlapping premium car brands Mini, Rolls-Royce and BMW. The brand recognition and high investments in research and development seems to be the trumps of BMW (BMW, n.d.: BMW Education Programme n.d.). This report will give a more detailed view at the current situation of the BMW Group with an analysis of the company’s strategies but also with a look at the issues and a final evaluation of the authors of this report.

2.Strategic Analysis
Integral to the understanding of the organisation BMW Group is a detailed strategic analysis of the company. Appendixes 1 and 2 both contain various tools for analysis, namely a SWOT and a PESTEL analysis. One can draw upon these when analysing all the forces and factors affecting a company as an aggregate. It is also important to place the findings of these analyses in a context. In this case, a strategic analysis of BMW Group should not only consider the information contained in both these analyses, but also the context in which the firm operates.

As mentioned, in Appendix 1, a SWOT analysis considers the current position of a company. In the case of BMW Group, the position is currently enjoys is a very strong one. When critically analysis the mentioned weaknesses and threats it becomes apparent that each of these are common to most companies and car manufacturers in the market segments chosen by BMW Group and its subsidiaries. In a sense this leads to a cancelling out effect, which will be discusses below.

For example, in terms of threats to automotive manufacturers, existing and fierce competition applies to the vast majority, as does being affected by the volatility of fuel prices. To a large extent the price of raw materials also poses a threat to all manufacturers, however this varies by small degrees when one considers that in a contemporary environment many cars do not share similar materials. This is due to manufacturers seeking competitive advantage through vehicle parts and structures being made of differing alloys, in attempts for qualities such as greater strength and lighter weight. In spite of this, steel remains a predominant material in the automobiles of BMW Group.

Having similar “threats” appropriate to most manufacturers means they are all competing amidst similar circumstances, so no firm is solely disadvantaged as a result.
It is a similar case when one considers the weaknesses of BMW Group. Despite minor differences, most manufacturers in the market segments operated in by BMW Group share most weaknesses. All premium carmakers are faced with stiff competition, as it is the nature of...

References: BMW 2005, Public Affairs Letter, BMW Group, viewed 1 November 2010,
BMW 2007, BMW Group stellt die Weichen für die Zukunft, BMW Group Press Club, viewed 31 August 2010,
BMW 2008, Company portrait, BMW Group, viewed 31 August 2010,
BMW 2008a, Annual Report 2008, BMW Group, viewed 1 November 2010,
BMW 2009, Annual Report 2009, BMW Group, viewed 1 November 2010,
BMW n.d., History, BMW Group, viewed 2 November 2010,
BMW Education Programme n.d., The Company, viewed 1 November 2010,
Hill, C, Jones, G, Galvin, P, Haidar, A 2007, Strategic Management: An Integrated Approach, 2nd , John Wiley & Sons Australia Ltd, Australia.
Horatiu, B 2009, Statement by Dr. Norbert Reithofer at the Annual General Meeting of BMW AG, viewed 31 August 2010,
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