Bayerische Flugzeug Werke was founded on March 7, 1916 and even though this company, which specialized in aircraft engines, was acquired by BMW in 1922, the BMW Group considers BFW’s establishment as a point of its own foundation. World War I really helped the small company grow so that in 1918, it was converted into a stock corporation with share capital of 12 million Reichsmarks. Franz Josef Popp, the General Manager of the former limited liability company, was appointed General Director. After the war, the company turned its attention to rail vehicle brakes and built-in engines because of the production ban on aircraft engines. In 1922, ...view middle of the document...
Just like any other global company, even BMW was hit by the financial crisis in 2008/2009. In the early 2008 the BMW stock was trading for about $43/share and in October 2008 it hit its minimum of approximately $16/share. Since then the BMW Group has slowly recovered and currently the stock is at a value of $38.2/share, which means that the company’s recent performance was good. The company also reports a significant increase of sold automobiles – 13.8% compared to the same quarter last year. Because of that, the company reported an increase in revenue by 8.1% to euro 12,443 million (excluding the impact of changes in exchange rates – 7.8%). One of the main competitors on the market, Audi Group, reported a revenue of euro 6,700 million. The BMW Group reports a net profit of euro 324 million for the first three months of the year (2009: net loss of euro 152 million). Audi Group, however, was able to generate more profit – around euro 363 million. This reflects BMW Group’s strong position on global automobile market. Even though the company, as well as others, suffered a setback in a form of an economic crisis, it was able to recover impressively fast. Financial reports for Q1 2010 of both companies were quite similar, which means that BMW, globally, has a very strong position on the market. The fact that overall profit was lower than its competitor’s should not be considered as a factor stating that BMW Group’s market position is weaker. It just means that companies are dominant on different markets. Graph below indicates BMW’s dominance on market in the UK.
Current business strategy
BMW Group specializes in three types of products/services: automobile production, motorcycle production and financial services with automobile production being their main area of interest. With BMW, MINI and Rolls-Royce Motor Cars, the BMW Group is the world's only car maker to pursue a purely premium strategy for all market sectors covered by its brands, from exclusive smaller cars to luxury limousines. BMW has established itself as a brand that is associated with quality, luxury, style and advanced technology and this reputation allows the company to gain large profits from this market. The mission statement of the company states: “The mission statement up to the year 2020 is clearly defined: the BMW Group is the world's leading provider of premium products and premium services for individual mobility”. This is supposed to be achieved by clever marketing. BMW’s marketing strategy consists of many types of advertising and events. One of the company’s main source of marketing is its...