PRODUCTION OF BMW

Innovative manufacturing technologies and the application of new

materials characterize the production process for BMW i cars. Their
production stands at the beginning of a value chain that is completely
aligned with sustainability criteria. From the raw materials production
to the energy-efficient vehicle operations and the recycling as the last
step, the chosen approach makes a considerable contribution to the
favorable overall life cycle assessment of the plug-in hybrid sports car
BMW i8.

BMW has highly skilled people working for them in all areas, from mechanics to
customer helpline staff. All are prompt and professional, and work hard to
maintain the company’s image. BMW has manufacturing facilities in many
different countries. In India, the manufacturing facility is in Chennai, and the
facilities were opened in March 2007 and it produces the BMW series one, three,
five and seven. This facility is capable of producing 11,000 units per year, at
maximum output. The spare parts center is located in Mumbai so that transport
of these spare parts can be carried out swiftly.

MARKET STRATEGY

BMW has a dealerised network for the sales of its automobiles. BMW does not
go through automobile distributors, but directly appoints showroom dealers,
because the investment is very high to assign a distributor and the margins are
less for showrooms. Thus, BMW has its authorised showrooms and the cars are
sold from showrooms to customers. However, for distribution of spare parts,
BMW does have distributors and stockists at strategic locations. The showrooms
of BMW are found to be present in the most premium parts of urban cities. Even
in a place like Mumbai, you will find only 3-4 showrooms of BMW, and not more.
Driving pleasure, premium quality and reliability guarantee the latest models
from the BMW and MINI brands the highest acclaim in international
automobile markets. That has been confirmed yet again in a recent study
conducted by international market research firm J.D. Power. In its latest
customer survey – the Automotive Performance and Layout Study (APEAL) –
assessing satisfaction levels among North American new car buyers, the BMW
5 Series range, BMW X3, BMW Z4 and MINI Countryman emerged as
winners of their respective vehicle segments. In addition, four more models
from the BMW Group finished in the top three of their category. This tally
means the BMW Group boasts the highest number of segment winners of all
manufacturers in the latest APEAL survey.

Such excellent individual scores also boosted the overall rankings of the BMW
and MINI brands, with BMW coming third in the latest survey. As well as the
class-winners – the BMW 5 Series range, BMW X3 and BMW Z4 – the
outstanding results of the BMW 7 Series range also contributed to this
outcome. The luxury saloon not only came second in its segment but also
claimed the second-highest individual score of all the vehicles involved in the
APEAL survey, making it the top European model in the entire competition.
The BMW 3 Series range and the BMW X6 also finished as runners-up in their
respective segments.

The MINI brand likewise bumped up its overall results compared to the
previous year. The main driving force here was the new MINI Countryman,
which instantly took top honours in its vehicle class. The MINI Cooper also
made it onto the winners’ podium, finishing second in its segment.
BMW business strategy can be characterized as product differentiation with a
particular focus on design and digitization. Electromobility represents the latest
direction for BMW Group product differentiation and the company introduced its
fully electric BMW i3 in 2013. This has been followed by plug-in hybrid vehicle
BMW i8 in 2014. Moreover, BMW business strategy focuses on individual
mobility in the premium segment – combined with attractive mobility services.[1]

The company stays loyal to Strategy Number One which strives to align high
levels of profitability in short-term perspective with increasing the levels of long-
term value of the company in times of change. Four strategic areas for BMW have
been specified as “Growth”, “Shaping the Future”, “Profitability” and “Access to
technology and customers”

BMW Group competitive advantage is based on the following points:

1. Representation of status and achievement. BMW belongs to premium

car categories, and accordingly, possession of a BMW model car can be
interpreted as a sign of achievement and social status in a society.

2. Effective design and features integrated to each model of the

brand. These common design and effective features include, but not limited to
the two-section, rounded radiator grille, attractive aesthetics, sophisticated style,
and Hofmeister kink, i.e. the counter curve in the window-outline at the base of
the rear roof pillar.

3. Competitive post-sales service. BMW received positive acclaim for

superior after-the-sales customer service and this fact is greatly valued by
customers.

Research and development (R&D) plays an integral role in sustainability of BMW

competitive advantage and this fact is duly recognized by the senior management.
In 2015, R&D investments were increased by EUR 136 million to more than EUR
4.2 billion. It has to be noted that BMW competitive advantage is challenging to
sustain in the long-term perspective because sustainability of competitive
advantage depends on the ability of the company to introduce innovative
products, features and capabilities on a regular manner.

BMW Group contains more detailed discussion of BMW business strategy. The
report also illustrates the application of the major analytical strategic
frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces,
Value Chain analysis and McKinsey 7S Model on BMW Group. Moreover, the
report contains analyses of BMW Group leadership and organizational
structure and marketing strategy and discusses the issues of corporate social
responsibility.
As the world continues to change at a fast pace so does the automotive
industry. BMW has made it a part of their strategy to maintain an image,
but also keep up with the modern changes to the market. To do this they
have deployed what they call the Number One Strategy. The strategy
focuses on two targets: to be profitable and to enhance long-term value in
times of change. And this applies to technological, structural as well as
cultural aspects of the company. Since 2007, they have been implementing
various initiatives in keeping with the strategy’s four pillars: Growth,
Shaping the Future, Profitability and Access to Technologies and
Customers. 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.
Audi has also deployed a long term strategy that focuses on the future.
Audi's 2020 strategy was implemented in 2010 and again in 2011. The
mission of the 2020 strategy is to "delight customers world-wide." To
accomplish this The Audi brand has defined its understanding of customer
delight in greater detail in the following four areas of action, which it
examines, formulates and substantiates as part of an ongoing process:

 We define innovation
 We create experiences
 We live responsibility