BMW Planning to Reach 2 Million Autos Sales Goal Four Years Early
BMW had planned to reach worldwide car sales of 2 million by 2020. Now, it's readjusting those numbers to reflect it likely reaching its goal by 2016. Oh, the tribulations of a luxury automaker in a recession... BMW has found solace in sales that are still annually increasing in "high single digits" in the U.S. market, as well as other Western regions where it has long sold its vehicles. But BMW has picked up the most ground in China and what it has coined "BRIKT": Brazil, Russia, India, South Korea, and Turkey. Each of them have either recently begun loosening protectionist trading policies or have recently run into an economic boom, allowing newly well-off customers to pursue luxury brands. To accommodate its plans to increase sales, BMW is looking at building a plant in Brazil and its second manufacturing site in China, choosing to rely more on developing countries not hampered by the Eurozone debt crisis. Despite all of the good fortune and increased sales, BMW is not without its share of challenges. Much of its sales are coming from its 1 Series and 3 Series entry level model ranges. That's brought down its profit margin from 11.9 percent to what is expected to be "eight to 10 percent" over the next few years. Last year, Audi, with the leverage of corporate giant Volkswagen, had a 12.1-percent profit margin and Mercedes-Benz, complete with massive investments in its A-Class and B-Class small cars, posted a 9 percent profit margin. BMW CEO Norbert Reithofer said "We are targeting new highs in sales volume and pretax earnings for 2012. We are off to a promising start." Last year, BMW sold 1.67 million vehicles worldwide, including its Mini and Roll-Royce brands. Of those, 305,766 vehicles were sold in the U.S., an almost 40,000 unit increase from 2010. Sales in the U.S. two months into 2012 are already outpacing 2011's numbers. Source: Automotive News (Subscription required)
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