BMW boss Oliver Zipse
The more than 70,000 German BMW employees benefit from savings.
Munich On the more than 70,000 German BMWEmployees are eligible for savings. CEO Oliver Zipse and Works Council Chairman Manfred Schoch will announce the long-awaited austerity package on Wednesday in Munich at a company meeting. For example, the generous profit premium of 15 to 20 percent is expected to decline in comparison to the industry, according to negotiating circles.
For 2018 had the BMW-Employee get 9175 euros, about 4000 euros more as the colleagues at Daimler, Harder it hits the temporary workers, for the first time in years in the German BMW plants almost no extension to receive. After a decade with strong new hires, the Munich-based carmaker has now prescribed a personal diet. In 2019 and 2020, a job in administration or production will have to disappear for any new job in future areas such as electromobility and autonomous driving.
Neither works council nor company wanted to comment on the agreement in advance. It was negotiated hard, it said in the camp of the employees. The savings package among employees is part of a twelve-billion-euro “efficiency program” designed to stabilize returns by 2022.
BMW is thus more ambitious than the competition: While Mercedes CEO Ola Källenius had to lower the yield expectations in the car business for 2020 to four percent and expect only six percent in 2022, BMW is aiming in the medium term, another eight percent. Currently the value is 6.6 percent.
Zipse and CFO Nicolas Peter want to achieve this with a mix of savings and growth. In addition to reductions in personnel and materials, models and engine variants are deleted. But different than for example Audi the BMW plants are significantly better utilized. In China and the US, capacities are being ramped up, and BMW is also building a new plant in Hungary.
The Munichers pay special attention to the luxury class. BMW was so far only with the 7 Series and the brand Rolls-Royce Since last year, the 8-series and since the beginning of 2018 the extra-large SUV X7 is on offer. Built in the US plant Spartanburg giant SUV enjoys great popularity. As a result, production is expected to double in the coming year to more than 50,000 units. All in all, BMW wants to sell 110,000 cars in luxury this year, by 2020 it will be 140,000.
Faster investment in e-mobility
This would double sales in the particularly high-yield luxury segment compared to 2018. In the medium term, BMW will also benefit from the majority takeover of the China joint venture with Brilliance. In 2022, BMW is the first Western auto company to take over 75 per cent of the joint venture, increasing its profits from the largest car market in the world in its own balance sheet.
This is a cushion that BMW will need. The growing share of SUVs is forcing BMW to invest more in electromobility to avoid paying EU fines for overriding climate issues. So a growing proportion of new cars to be equipped with hybrid drives, but in the production of significantly more expensive than conventional diesel and gasoline.
The announcement of TeslaBoss Elon Musk, BMW is also putting pressure on a production plant near Berlin. With the “i3” the Munich have since 2013 an electric car on the market, but Tesla poaching vigorously in the BMW clientele. BMW 2020 wants to make up ground with the now introduced Elektro-Mini and the China-built ix3. In 2021, the first electric cars will be rolling out of the German plants with the i4 and the electric SUV iNext.
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