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SLIDE 2: BMW Group Quarterly Statement to 31 March 2026

Ladies and Gentlemen,

Good Morning.

The year 2026 started off with sound financial results for the BMW Group, in line with our expectations.

SLIDE 3: BMW Group Performance in Q1 2026

In the first quarter, Group revenues totaled 31 billion euros.

Group earnings before tax amounted to 2.35 billion euros, approximately 25 percent lower than in Q1 2025.

With this result, we generated a Group EBT margin of 7.6 percent, on the level of the 2025 full year.

The operating profit in the Automotive segment was 1.345 billion euros.

Consequently, the EBIT margin in the Automotive segment stood at 
5 percent, in the middle of our full-year guidance corridor of 4 to 6 percent.

As you know, we consistently focus on our reported figures. Accordingly, the five percent represents our reported 
EBIT margin without any adjustments.

The Q1 extra tariff burden of 1.25 percentage points is accounted for in this margin.

In addition, the EBIT margin includes the depreciation from the BBA purchase price allocation of 1.2 percentage points.

SLIDE 4: Automotive Retail Units, BEV Units and Auto Revenue

Let me now provide more details on the Automotive Segment’s performance across key metrics.

In the first quarter, the BMW Group delivered around 566,000 BMW, MINI and Rolls-Royce vehicles to customers. This represents a slight decrease of 3.5 percent compared to the same period last year, driven by the sales decline of all-electric vehicles in the US and China.

The BMW brand saw a decline of 4.6 percent year-on-year.

This was driven by shifts in regional and powertrain sales.

The MINI brand continued its growth following the successful renewal of its model portfolio, achieving a solid sales increase of 6 percent.

Let’s take a closer look at our sales performance across regions.

Starting this year, we have slightly adjusted our regional sales reporting to reflect our sales organization structure rather than geographical continents.

In our largest sales region, Europe, deliveries increased slightly by 3.0 percent. We saw growth across all powertrains – combustion engine vehicles, all-electric vehicles and plug-in hybrids.

The BMW brand’s order intake in Europe showed strong growth across the entire product portfolio in Q1, with an order bank reaching well into the second half of the year.

In our sales region Asia-Pacific, Eastern Europe, Middle East, and Africa, deliveries declined by around 6,700 units – or 8.3 percent – year-on-year. This development was influenced by multiple factors, predominantly the macroeconomic environment and the diverse competitive landscape throughout the region, while the conflict in the Middle East had a limited regional sales impact in Q1.

In the Americas region, retail sales decreased by 4.0 percent year-on-year, primarily due to the US.

Here, sales of all-electric vehicles dropped significantly following the discontinuation of IRA support in the fourth quarter of last year. Our product portfolio enabled us to largely offset this decline and fulfil customer demand with our attractive ICE vehicles.

When comparing US sales to previous year, we must also remember that Q1 2025 was positively influenced by strong customer demand, driven by expectations of customs duty increases starting in April 2025.

Overall, we performed better than the total US market, which declined by 6.6 percent in the first quarter.

In China, the overall market declined sharply by over 17 percent in Q1, driven by reductions of government subsidies and changes of regulations.

By comparison, BMW Group sales decreased by 10 percent and therefore outperformed the overall market in Q1.

Switching gears to BEV retail sales:

In the first three months, the BMW Group delivered over 87,000 all-electric vehicles to customers worldwide.

Sales of electrified vehicles, including both BEVs and plug-in hybrids, amounted to approximately 133,000 vehicles.

This represents a BEV share of total sales of 15.5 percent and an electrified vehicle share of 23.4 percent.

In Europe, BEV sales continued to grow and order intake increased by more than 60 percent year-on-year, especially due to strong demand for our all-new iX3* and the iX1*.

In China and the US, the removal of incentives and the reduction of subsidies for electrified vehicles had a noticeable impact on BEV sales year-on-year, reflecting the country-specific market dynamics.

Automotive Segment revenues declined moderately by 7.0 percent to 
27.2 billion euros in the first quarter.

Adjusted for currency translation, mainly from the US-Dollar and the Chinese Renminbi, the decrease was 2.9 percent.

It was driven by lower sales volumes and intense global competition.

Let’s now take a closer look at the year-on-year changes in the operational result on the following slide.

SLIDE 5: Automotive Segment EBIT in Q1 2026

In the first three months, changes in currency and raw material positions accounted for a negative impact of around 400 million euros.

As anticipated, the adverse FX development from the second half of 2025 continued into the first quarter of 2026.

The net effect of volume, model mix and pricing resulted in a negative impact of around 700 million euros compared to Q1 2025.

In addition to the impact from lower sales volumes, this decline was driven by intense competitive pressure across all major markets.

Ladies and Gentlemen,

We are continuing cost reductions across the company to tackle the overall headwinds.

In the first quarter of 2026, we have further reduced both R&D and capital expenditure, thanks to early investments in the NEUE KLASSE.

As of March, Group R&D expenditure totalled around 1.8 billion euros, a significant decrease of around 12 percent compared to the previous year.

The R&D ratio according to the German Commercial Code came in at 5.7 percent.

Despite this significant reduction, research and development expenses in the P&L increased by 100 million euros due to two factors:

An increase of 200 million euros in depreciation, resulting from capitalized development costs in prior years.

And a lower R&D capitalization ratio compared to Q1 2025, which decreased by 4.3 percentage points to 31.4 percent.

Our ongoing commitment to reducing operating costs is further visible by the development of selling and administrative expenses, which decreased by around 100 million euros year-on-year.

Other Cost Changes provided a tailwind of around 400 million euros compared to the first quarter of 2025.

This includes various factors, most notably manufacturing costs and warranty expenses as well a year-on-year tariff burden.

Overall, Automotive EBIT amounted to 1.3 billion euros in the first quarter.

The decline of approximately 700 million euros compared to Q1 2025 was driven by headwinds from FX, tariffs and depreciation.

SLIDE 6: Automotive Segment Free Cash Flow in Q1 2026

Free cashflow in the Automotive Segment amounted to around 800 million euros in the first quarter of 2026.

The net change in working capital reduced free cashflow by around 
500 million euros, as expected.

This mainly reflects the typical Q1 inventory build-up, with production exceeding sales volume.

The impact of higher inventories was partly compensated by an increase in trade payables, which rose in line with production levels.

The net effect of capital expenditure and depreciation contributed about 600 million euros to free cashflow.

Depreciation exceeded capital expenditure in the first quarter, positively impacting free cashflow.

We expected this position to flip versus previous years, as we continue to reduce capex and see depreciation from earlier investments take effect.

This trend will continue throughout 2026.

The capex ratio for Q1 was 2.0 percent, reflecting the typical low level seen in the first quarter of the year.

The change in provisions reduced free cashflow in the first quarter by 
300 million euros, primarily due to the consumption of warranty provisions.

The change in the position other reduced free cashflow by 300 million euros, mainly due to regular tax payments.

For the full year, the BMW Group is targeting a free cashflow in the Automotive segment above 4.5 billion euros.

Ladies and Gentlemen,

The BMW Group remains firmly committed to its shareholder return strategy, which includes both dividend payments and share buybacks.

The second tranche of our third share buyback program with a volume of 625 million euros is currently underway and is scheduled for completion by the end of August at the latest. The third tranche is planned to follow thereafter.

SLIDE 7: Financial Services Segment YTD March 2026

Let’s now turn to our Financial Services Segment.

In the first quarter, the number of new contracts concluded with retail customers increased slightly by 4.3 percent year-on-year, reaching 420,000 contracts.

The penetration rate for lease and loan offerings increased to 51.6 percent in the first quarter.

This development was supported by changes in the competitive environment in China. Mid-2025, local banks significantly reduced commissions related to brokering financing and insurance products for end customers.

Adjusted for FX effects, new business volume grew by 4.1 percent to about 16 billion euros.

Segment earnings for the first quarter amounted to 381 million euros, a decrease of 269 million euros compared to Q1 2025.

This decline results from an addition to an already existing risk provision in the UK. At the end of March, the Financial Conduct Authority (FCA) issued its final cross-sector compensation program for customers who were sold automotive financing products under certain commission models.

Unfortunately, the published program reflects only a few of the many amendment proposals made to the initial draft by both the UK Finance and Leasing Association and the BMW Group.

As a result, the compensation payment volume will likely exceed previous estimations.

Additionally, income from the resale of end-of-lease vehicles was lower year-on-year, as expected.

The credit loss ratio across the entire credit portfolio remained low at 0.27 percent.

SLIDE 8: Motorcycles Segment in Q1 2026

In the Motorcycles Segment, first-quarter deliveries declined slightly by 4.2 percent year-on-year.

Segment EBIT for the first three months rose to 89 million euros, with an EBIT margin of 11.4 percent.

Finally, one remark on the Other Entities result, which increased by around 300 million euros.

This was driven by positive valuation effects from interest rate derivatives, resulting from the sharp rise in long-term interest rates in March.

SLIDE 9: Outlook 2026

Ladies and Gentlemen,

Let me now turn to our outlook for 2026 and briefly outline some of our current assumptions.

The situation in the Middle East currently remains highly uncertain. Our outlook assumes that the ongoing conflict is temporary.

The expected tariff impact on our 2026 results can still only be estimated based on our existing assumptions.

We expect import duties from the EU to the US to remain at their current levels.

Following the recent positive vote in the European Parliament, we anticipate that tariffs on imports from the US to the EU will drop to 0 percent effective in the second half of the year.

Similarly, tariff reductions for imports into the US from Mexico and Canada are also expected to take effect in the second half of the year.

We continue to anticipate a full-year negative impact of around 
1.25 percentage points on the Auto EBIT margin from the increased tariffs, after 1.5 percentage points in 2025.

In China, we are making good progress with our set of measures to support market performance.

The overall vehicle market in China declined more sharply than anticipated throughout the first quarter, already prompting several revisions of official market forecasts for the year by the CPCA.

In light of this trend, our focus will remain on achieving the right balance between sales volume, transaction prices, and dealer profitability.

Based on our assumptions, our full-year guidance parameters remain unchanged.

Group earnings before tax are expected to be moderately lower than in 2025.

In the Automotive segment, we forecast global deliveries to be at last year’s level.

The EBIT margin is expected to be within a corridor between 4 and 6 percent.

The EBIT margin in the Motorcycles Segment should also come in at between 4 and 6 percent.

In the Financial Services Segment, we are targeting a Return on Equity (RoE) in the range of 13 to 16 percent for the full year.

SLIDE 10: Q1 Profitability in the middle of full-year guidance corridor

Ladies and Gentlemen,

The year 2026 started off with sound financials for the BMW Group, with an Auto EBIT margin in the middle of our full-year guidance corridor.

Within our global business model, we continue to leverage flexibility across powertrains and regions, as we ramp up our NEUE KLASSE.

This flexibility enables us to effectively mitigate risks as they arise.

The prudent management of R&D, capex, and operating costs is clearly reflected in our Q1 results, underscoring our strong commitment to financial discipline.

With that, the BMW Group remains on track to meet its operational targets as we advance our strategic plan.

And as we roll-out the NEUE KLASSE technologies across the entire portfolio, we at the BMW Group and all of our stakeholders have plenty to look forward to.

Thank you.

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Ladies and Gentlemen,

Good morning.

Before I'm talking about the quarter figures, I would like to address a tragic loss that has deeply touched many BMW fans around the world.

On May 1, race car driver, longtime BMW works driver, and company ambassador Alessandro Zanardi passed away unexpectedly.

“Alex” was an impressive personality, an unwavering optimist, and an inspiration to many people worldwide. He demonstrated what is possible in life with dedication, willpower, and ambition.

The BMW Group has lost a fascinating humanitarian representative, and BMW M Motorsport has lost an ambitious and successful works driver.

Ladies and Gentlemen,

Walter Mertl has taken you through the results after the first three months of 2026.

As we outlined in March at our Annual Conference, we knew that there would be several headwinds we would face throughout this year.

For us, it is about minimizing their impact, while consistently leveraging opportunities that arise.

At the same time, we remain firmly on course with our long-term strategy – a strategy that has provided clear direction and enabled us to navigate an increasingly unpredictable global business environment over recent years.

Three characteristics in particular define the BMW way:

First: Our strategy of technological neutrality

Second: The BMW Group’s global footprint and

Third: Inspiring brands and fascinating products.

Since 2021, the BMW Group’s long-term product and technology orientation has focused on the NEUE KLASSE.

Building on an exceptionally strong foundation of products and successful technologies delivered to customers over many years through to today, we are now making a huge leap forward in nearly every area of technology with the NEUE KLASSE. This will pay off as we roll these technologies out rapidly across the whole product portfolio.

Last year in September, here in Munich at the IAA Mobility, we presented the BMW iX3*, the first vehicle of the NEUE KLASSE. With this all-new vehicle generation BMW is entering into a new era.

The launch of the iX3 has been extremely successful.

Just a few weeks ago, in March, we handed over the first BMW iX3 vehicles to customers across Europe.

Over the past weeks, the model has also reached showrooms throughout the region.

Pre‑orders in Europe now exceed 50,000 units, underscoring the strong interest in this vehicle.

The iX3 also continues to win notable major international awards.

Most recently, it won two awards at the renowned World Car Awards. An international jury of 98 automotive journalists presented the BMW iX3 two prestigious titles: the 2026 “World Car of the Year”, beating out competitors across all powertrain categories; as well as 2026 “World Electric Vehicle” accolade.

With the first NEUE KLASSE model, BMW has delivered a clear step forward in technology and design – one that is resonating strongly with experts, journalists, and customers alike.

Given the very high market demand, we already pulled forward the second shift of BMW iX3 production at our Debrecen plant in February.

Further rollout across the US and Asian markets is planned for the coming months.

And the iX3 was just the beginning – a lot has happened since our annual conference. The NEUE KLASSE is gradually making its mark across the entire BMW portfolio.

In March, we unveiled the next step with the world premiere of the new BMW i3 at BMW Park in Munich.

Since 1975, the 3 Series has inspired dreams. At the core of the brand, each of the eight generations embodies progress and innovation. And with the BMW i3 we are building our future on this rich legacy.

This event provided a unique opportunity to celebrate this milestone not only with media and other key stakeholders, but especially and perhaps most importantly with our associates.

More than 30,000 employees joined the celebrations over days, underscoring the strong bond our team feels with the brand and their pride in this incredible moment – both for the company and for their achievements in bringing this vehicle to life.

As the second model of the NEUE KLASSE, the BMW i3 perfectly symbolizes the journey BMW has taken over the last years.

It is, of course, a completely new vehicle with a reimagined design and seamless integration of advanced technologies.

At the same time, the BMW i3 represents the progress of the BMW Group itself – from the systematic modernization of our production facilities through new ways of working that enable efficiency, scalability, and our long-term competitiveness.

The i3 will be produced at our main Plant in Munich. With an investment of around 650 million euros, the facility has been completely remodeled following the principles of BMW iFactory – lean, green, digital.

Production of up to 1,000 vehicles a day continued uninterrupted during the shopfloor adaptations over many months.

Beginning in 2027, the plant will exclusively produce electric vehicles.

The plant also continues to make great progress in realizing cost efficiencies. When the i3 rolls off the line for customers, we will have reduced overall production costs at the Munich plant by an additional 10%.

These improvements are driven by optimized production processes, targeted automation and digitalization, as well as the vehicle construction improvements enabled by NEUE KLASSE technologies.

Series production of the BMW i3 begins in August, followed by the market launch in Europe a few weeks later.

Several additional NEUE KLASSE models will soon be manufactured in Munich, including the BMW i3 Touring.

The BMW i3 leverages all the technologies developed for the NEUE KLASSE. From driving dynamics to powertrain, from battery technology to operating concept and the digital user experience.

And of course you can choose between different drive variants. Because we remain technology-open.

Each element is perfectly attuned to the characteristics of the 3 Series – creating a whole new dimension of sheer driving pleasure.

This is also confirmed by initial reviews and feedback from customers and journalists, which have been very positive.

This was also evident just two weeks ago at Auto China in Beijing, the world’s largest automotive trade fair.

We presented not 1, not 2, but 3 new models:

The BMW iX3 and BMW i3 Long Wheelbase for the Chinese market as well as the world premiere of BMW 7 Series model update with NEUE KLASSE technologies and design elements.

The China-specific NEUE KLASSE vehicles have been developed in close collaboration with our local R&D teams and local partners in China – think global, act local.

This enables us to leverage the know-how of leading Chinese tech players and integrate local digital ecosystems and technologies to meet the specific needs of our Chinese customer needs – for example, in voice assistant features and automated driving solutions.

The momentum generated by the NEUE KLASSE in China will provide a powerful impulse for our portfolio and marks the beginning of the next chapter in BMW’s tailored innovation and technology leadership in this key market.

In 2026, the seven millionth BMW vehicle will roll off the lines at our Shenyang production base. This remarkable milestone underscores our long-term commitment to China. And we are constantly strengthening our local footprint to underpin this momentum.

Through deeper localization across the value chain and expanded China-based decision making, we are faster, more robust, and even more synchronized with local customer expectations and market dynamics.

The new BMW 7 Series we unveiled in Beijing will kick off the roll-out of Neue Klasse technologies across all powertrains and into other product lines, and segments.

Coming in the middle of its lifecycle, it is the most extensive model revision in BMW's history and will take the 7 Series to a whole new level.

The technology-open drive offer covers all customer needs. The updated BMW i7 with new round battery cells features up to over 700 kilometers of range according to the WLTP cycle, meaning an increase of 100 kilometers from the current version.

Start of production will begin in our plant at Dingolfing in July.

The new 7 Series exemplifies BMW’s ability to industrialize the latest technologies at speed, integrating them into series vehicles and making them available directly to our customers.

This summer, we will also unveil the next generation of our BMW X5. It will be the first BMW model to be offered with five different drivetrain variants: highly efficient conventional powertrains, plug-in hybrid, battery-electric and – from 2028 – also hydrogen.

In this way, we are laying the foundation to successfully meet the diverse needs of our customers around the world, both today and in the future.

Ladies and Gentlemen,

Our products continue to enjoy strong demand globally. We are well positioned to meet the needs of customers across different regions and markets.

In the first quarter we leveraged the strength of our current portfolio in a shifting environment – supported by a broad offering across brands, segments, drivetrain technologies and geographies.

Consistent with our balanced, global approach to sales, the performance in Europe helped to partially offset weaker dynamics in other markets. Sales were particularly robust in Germany, where Group registrations increased by more than 10% year-on-year.

In China and the U.S., the BMW Group performed better than the overall declining market.

BEV orders in Europe were up by around 62%, with European sales of fully-electric vehicles exceeding the previous year’s high level.

For the fifth consecutive quarter, the MINI brand delivered global growth, with sales increasing by 6%.

As we roll out the NEUE KLASSE, we can look ahead with confidence. Its technologies and design language will provide fresh momentum into our already strong BMW products. Offering individual mobility solutions tailored to the needs of customers across markets worldwide.

At the same time, the company is prepared to weather differing dynamics in global markets and to seize opportunities.

That combination is what sets the BMW Group apart.

We have stayed on course, consistently implementing our long-term strategy and are now ideally positioned to reap the rewards.

This is very much part of our DNA. Time and again, the BMW Group has proven resilient from the pandemic through supply chain disruptions and semiconductor shortages and the energy crisis.

Throughout, we have remained true to our technology‑open approach, which has proven its strength as global automotive markets continue to transition and delivered stronger results in new technologies.

As this will be my final quarterly call as CEO of the BMW Group, I want to extend my sincere thanks to the media and capital market communities who have accompanied me throughout my tenure since 2019.

I have always valued our dialogue – at times challenging, but consistently constructive – and I am grateful for the professionalism and engagement you have brought to these exchanges.

I hope you will extend the same openness and warm welcome to my successor, Milan Nedeljković.

I wish you all the best – and look forward to answering your questions one last time.

Thank you.

Munich. Parallel to the ramp-up of the Neue Klasse, the BMW Group has released solid financial figures in the first quarter: The Munich-based premium automaker reported an EBT of € 2,348 million – surpassing the two previous quarters (Q3/Q4 2025). Group EBT margin of 7.6 % was on par with the figure for the full year 2025 (7.7 %). Free cash flow in the Automotive segment totalled € 777 million, significantly above the same quarter of the previous year (+88.1 %).

As such, the BMW Group has maintained its positive momentum from the previous year in the first quarter of 2026. The company’s attractive product portfolio, technology‑open approach and resilience in key global regions ensure it maintains its successful course.

“Once again, our earnings for the first quarter demonstrate the value of strategic consistency, operational strength and a high degree of flexibility. We are well positioned to deliver continued success, despite challenging conditions,” said Oliver Zipse, Chairman of the Board of Management of BMW AG.

Order intake in Europe reaches record levels

The BMW brand achieved its highest ever order intake figure for a single quarter in Sales Region Europe. From January to March, orders for all-electric vehicles increased by more than 60% in Europe compared to the previous year. The BMW iX3* alone secured more than 50,000 orders since its design premiere in September by the end of March.

“During the first three months on the year, we received more orders in Europe than in any other quarter in the Company’s history. The key to our success lies in our broad product range: with our strong brands, we serve key segments and allow customers to select from the full range of drivetrains,” said Zipse. “The successful launch of the BMW iX3 and the positive feedback on the BMW i3 confirm that we made the right decisions with the Neue Klasse. Every future BMW model will feature the new technology clusters and use the new design language – regardless of drivetrain. Thus, we are elevating our product portfolio to a whole new level.”

The BMW Group delivered a total of 565,780 vehicles to customers worldwide in the first quarter. This represents a slight decrease of -3.5% compared with the same period last year. The BMW brand delivered a total of 496,006 vehicles to customers across the world in the first quarter of 2026 (-4.6%). One in ten of all BMW units delivered was a BMW M model.

MINI maintains its growth trajectory

The MINI brand increased its global sales for the fifth consecutive quarter, delivering 68,503 vehicles – growth of +6.0%. BEVs accounted for 35.1% of all MINI deliveries.
The Rolls-Royce brand delivered a total of 1,271 vehicles to customers in the first quarter (-8.0%). BMW Motorrad delivered 42,735 motorcycles and scooters to customers over the same period (-4.2%).

BEV demand growing in Europe

The BMW Group’s vehicle deliveries increased by 3.1% across all drivetrains in Europe, its largest sales region. Battery‑electric vehicles accounted for 25.3% of all sales in Europe (global: 15.5%). The BMW Group remains confident that it will meet the EU (27 + 2) CO₂ targets for 2026.
In the Americas sales region, which slightly declined by -4.0%, the decline in deliveries of all-electric BMW automobiles was largely offset by increased deliveries of vehicles with combustion engines. In China, where the total market contracted sharply by -17.5%, BMW Group deliveries performed somewhat better, falling by -10.0% during the reporting period.

Currency effects weigh on revenues

Group revenues totalled € 31,007 million (2025: € 33,758 million; -8.1%; adjusted for currency translation effects: -4.3%) highlighting the persistently intense competition in the automotive sector – particularly in China – as well as the slight decline in sales. Furthermore, adverse currency effects had a negative impact, primarily the Chinese renminbi and the US dollar.

Disciplined cost management continues to deliver results 

The BMW Group successfully delivered nominal costs reductions in the first quarter to tackle external challenges. The cost of sales went down by -6.4%, while administrative and sales expenses fell by -5.1% across the Group. As planned, the Company reduced its research & development expenditure from the 2024 peak to € 1,755 million (Q1/2025: € 1,984 million; -11.5%). The research & development expenditure ratio (German Commercial Code) fell to 5.7% (Q1/2025: 5.9%). Investments also decreased in the first quarter to € 1,723 million in line with planning (Q1/2025: € 2,819 million; -38.9%). The capital expenditure ratio came in at 2.0% (Q1/2025: 3.6%).

“Flexibility and speed of execution are two of the BMW Group’s strengths. That’s abundantly clear with the Neue Klasse – a stringent and comprehensive renewal of our entire vehicle portfolio in record time. The automotive innovations coming to market will strengthen our competitive position and improve our profitability,” said Chief Financial Officer Walter Mertl. “In a demanding economic environment, we remain highly focused on costs, leveraging multiple opportunities across the company with an approach designed to deliver sustained results.”

Share buyback on track

The Annual General Meeting in May 2025 authorised the Board of Management to buy back up to 10% of BMW AG’s share capital over the next five years. Based on this new authorisation, the Board of Management approved a third share buyback programme with a volume of up to € 2 billion, to be completed no later than 30 April 2027. The first tranche of shares worth € 750 million were repurchased by December 2025. The second tranche of shares, amounting to € 625 million, is on track to be purchased by 31 August 2026. On 31 March 2026, BMW AG held shares with a nominal value of € 12,225,269. This corresponds to 1.99% of the share capital on the same date.

Group EBT well over € 2 billion again despite the tariffs burden

The Group achieved earnings before tax (EBT) of € 2,348 million in the first three months of the year (Q1/2025: € 3,113 million; -24.6%). In doing so, the company delivered earnings of more than € 2 billion in a demanding economic environment once again. The EBT margin for the period was 7.6% (Q1/2025: 9.2%). Group net profit amounted to € 1,672 million (Q1/2025: € 2,173 million; -23.1%).

EBIT margin in the annual guidance corridor of 4–6%
The Automotive segment achieved an EBIT of € 1,345 million (Q1/2025: € 2,024 million; -33.5 %) and an EBIT margin of 5.0 % (Q1/2025: 6.9 %; -1.9 percentage points) – in the middle of the forecast annual range of 4–6% – and extra tariffs accounted for a 1.25 percentage point reduction in the EBIT margin in the quarter. This was a significantly larger hit than the same quarter in the previous year, in which only EU import tariffs were due on battery‑electric vehicles from China. The EBIT margin was also affected by depreciation and amortisation from the BBA purchase price allocation amounting to 1.2 percentage points.

Fierce competition across major automotive markets, especially in China, impacted pricing and sales volumes, weighing on EBIT. As anticipated, currency and raw material price effects dampened the company’s first‑quarter earnings performance.

Free cash flow in the Automotive segment increased significantly to € 777 million in the first three months of the year (Q1/2025: € 413 million). The marked reduction of capital expenditure compared with prior‑year figures had a positive impact on free cash flow. Conversely, the typical seasonal increase in inventories weighed on working capital. The segment’s free cash flow is expected to exceed
€ 4.5 billion for the full year.

Financial Services: slight growth in new contracts with end customers

The Financial Services segment secured 420,212 new credit financing and leasing contracts with end customersin the first quarter. The growth of 4.3 % compared to the same quarter last year is largely attributable to the changes in the competitive landscape in the Chinese market since mid‑2025. The penetration rate** – the share of BMW Group vehicles either leased or financed through the Financial Services segment – increased to 51.6% in the reporting period(Q1/2025: 43.0%; +8.6%).

The segment generated a profit before tax (PBT) of € 381 million in the first three months of the year (Q1/2025: € 650 million; –41.4%). The decline was primarily driven by an increase of the existing risk provision for cross-sector compensation schemes for motor finance customers in the United Kingdom.

Moreover, the income from the resale of end-of-lease vehicles was lower.

Outlook for the 2026 financial year confirmed

The BMW Group confirms its full‑year forecast after the first quarter, in a deteriorating economic environment. Forecasts for the global economy and automotive markets have been revised downwards in recent weeks. The global automotive market is now expected to see a slight decrease.

For the 2026 financial year, the BMW Group continues to expect a higher level of volatility related to tariffs. The company anticipates a negative impact from higher tariffs of around 1.25 percentage points on the EBIT margin in the Automotive segment.

The geopolitical situation in the Middle East is currently characterised by a high degree of uncertainty due to the ongoing conflict in the region. The outlook assumes that the conflict will not be enduring.

The BMW Group continues to see overall growth potential in Europe and the United States. In China, the company looks to balance sales volume, transaction prices and dealer profitability.

Globally, the company forecasts that deliveries will be on a par with the previous year and that fully-electric vehicles will account for the same share of sales as 2025.

The BMW Group remains disciplined in cost management. In the 2026 financial year, the company will further reduce capital expenditure, manufacturing costs, research & development spending, as well as sales & administrative expenses. Compared to the prior year, the BMW Group expects a lower additional burden from tariffs as previously outlined. This will be offset by increasing depreciation resulting from investments and the capitalization of development costs in previous years. Additionally, earnings will be negatively impacted by adverse currency and raw material effects, by pricing and product measures to stabilize transaction prices in China, by a significantly lower capitalization rate resulting from the development portfolio structure, and by overall lower revenues related to the used-car market. The BMW Group will partially offset these higher burdens through the afore-mentioned cost reductions.

Regarding forecast KPIs: The EBIT margin for the Automotive Segment is forecast to be within the range of 4–6%. Return on Capital Employed (RoCE) will be between 6–10%.

In the Financial Services Segment, Return on Equity (RoE) is projected to be between 13–16%.

In the Motorcycles Segment, deliveries are forecast to be on a par with the previous year, with an EBIT margin within the range of 4.0–6.0% and a Return on Capital Employed (RoCE) of 10–14%.

In light of the forecast developments, a moderate decline in Group earnings before tax is expected for 2026.

The BMW Group’s actual business performance may deviate from these expectations – for example, due to changes in political and macroeconomic conditions.

** Starting in the 2026 financial year, the penetration rate will also include financing and leasing contracts for young used vehicles that are sold to end customers for the first time in the reporting year.

GLOSSARY – explanatory comments on key performance indicators

Deliveries to customers

A new or used vehicle is recorded as a delivery once it is handed over to the end user (which also includes leaseholders under lease contracts with BMW Financial Services). In the US and Canada, end users also include (1) dealers when they designate a vehicle as a service loaner or demonstrator vehicle and (2) dealers and other third parties when they purchase a company vehicle at auction and dealers when they purchase company vehicles directly from the BMW Group. Deliveries may be made by BMW AG, one of its international subsidiaries, a BMW Group retail outlet, or independent third-party dealers. The vast majority of deliveries – and hence the reporting of deliveries to the BMW Group – is made by independent third-party dealers. Retail vehicle deliveries during a given reporting period do not correlate directly to the revenues that the BMW Group recognises in respect of that particular reporting period.

Payout ratio

The payout ratio is preliminary. Although the Board of Management and the Supervisory Board will propose a fixed dividend per share at the Annual General Meeting, the number of shares entitled to a dividend is expected to fall by the Annual General Meeting due to the ongoing share buy-back programme. Accordingly, the total amount to be distributed to shareholders is also still expected to change by 13 May.

EBIT

Profit before financial result. Profit before financial result comprises revenues less cost of sales, less selling and administrative expenses and plus/minus net other operating income and expenses.

EBIT margin

Profit/loss before financial result as a percentage of revenues.

EBT

EBIT plus financial result.
PHEV

Plug-in-hybrid electric vehicle - hybrid vehicle with petrol engine and electric drive.

If you have any questions, please contact:

BMW Group Corporate Communications

Dr Britta Ullrich, Finance Communications

Telephone: +49 89 382-18364

Email: britta.ullrich@bmwgroup.com

Sebastian Keßler, Communications BMW Group, Strategy

Telephone: +49 89 382-21616

Email: Sebastian.KE.Kessler@bmwgroup.com

Max-Morten Borgmann, head of Communications BMW Group, Finance, Sales

Telephone: +49 89 382-24118

Email: Max-Morten.Borgmann@bmwgroup.com

Media website: https://newsroom.bmwgroup.com/global/en

Email: presse@bmwgroup.com

The BMW Group

With its four brands, BMW, MINI, Rolls-Royce and BMW Motorrad, the BMW Group is the world’s leading premium manufacturer of automobiles and motorcycles and also provides premium financial services. The BMW Group production network comprises over 30 production sites worldwide; the company has a global sales network in more than 140 countries.

In 2025, the BMW Group sold 2.46 million passenger vehicles and more than 202,500 motorcycles worldwide. The profit before tax in the financial year 2025 was € 10.2 billion on revenues amounting to € 133,5 billion. As of 31 December 2025, the BMW Group had a workforce of 154,540 employees.

The economic success of the BMW Group has always been based on long-term thinking and responsible action. Sustainability is a key element of the BMW Group’s corporate strategy and covers all products – from the supply chain through production to the end of their useful life. 

www.bmwgroup.com

LinkedIn: http://www.linkedin.com/company/bmw-group/

YouTube: https://www.youtube.com/bmwgroup

Instagram: https://www.instagram.com/bmwgroup

Facebook: https://www.facebook.com/bmwgroup

• MINI remixes iconic event, held over three weekends, visiting nine-cities, across three states.
• Fans can take their pick of routes for 20th Anniversary of biennial rally – the boldest most accessible MINI road trip yet.

Woodcliff Lake, NJ: MINI USA has officially opened the registration site for MINI TAKES THE STATES (MTTS) 2026. This year represents 20 years since the first MTTS in 2026. Held every other year, MINI owners looking to register can visit www.minitakesthestates.com to secure their spot on the tenth running of what has become a legendary event for MINI owners to rally together.

This year’s MTTS will be a trio of long-weekend rallies stretching from the iconic PCH to the legendary Adirondacks to the scenic Florida Keys. The three state, nine-city adventure will cruise some of the country’s most unforgettable roads in the west, northeast, and the south, celebrating MINI’s spirited community that knows how to have fun and motor on in three city-to-city rally events. The three events include:

• California (October 2–4), Monterey to Sonoma to Lake Tahoe
• New York (October 23–25), Buffalo to Syracuse to Lake Placid
• Florida (November 13–15), Fort Myers to Miami to Key West

The registration fee is $150 per person for each long-weekend event. Single-day passes are also available for purchase at $50 per person. All registration fees include an

official event goody bag while supplies last.

A New Chapter for a Legendary Event

The first MTTS launched in 2006 as a cross-country road rally to celebrate the debut of the very first MINI GP. Held every two years, it has since grown into one of the most celebrated recurring road trips in the United States, hosted and coordinated by an automotive OEM. In 2024, nearly 2,000 MINI owners joined at least a portion of the nine-day journey through the western U.S., with an average of 650 MINIs setting off each morning to the sound of music, cheers, and the rev of engines.

The new 2026 format preserves that energy in full while opening the doors wider for more to participate. This year, each day closes with a community gathering where drivers reconnect, share stories from the road, compare routes, and celebrate the spontaneous discoveries that have always defined MTTS.

Three Weekends, Three States, Three Cities Each 

Each weekend will follow MINI's signature Rise & Rally format. Participants will gather every morning for a light breakfast, live music, activities, and a send-off before setting off on a curated scenic route. Evenings will feature food/beverage and headline events at iconic venues.

To get the latest updates on MTTS 2026, visit www.MINITAKESTHESTATES.com.

Corporate Communications Contact:

Andrew Cutler, Head of Communications

MINI USA

Phone: 201-376-4962

E-mail: Andrew.cutler@miniusa.com

About MINI in the US

MINI is an independent brand of the BMW Group. In the United States, MINI USA operates as a business unit of BMW of North America, LLC, located in Woodcliff Lake, New Jersey and includes the marketing and sales organizations for the MINI brand. The authorized MINI USA dealer organization is represented by a network of 105 MINI full passenger car sales and service dealers located throughout the US. MINI USA began selling vehicles in the U.S. in 2002 with the introduction of the MINI Cooper and MINI Cooper S Hardtops. Since then, the MINI Brand in the U.S. has grown to encompass a model range of five unique vehicles.

Journalists note:  Media information about MINI and its products is available to journalists on-line at https://newsroom.bmwgroup.com/global/en.

                                                    #  #  #

Woodcliff Lake, NJ –   March   19, 2026 – The modern MINI brand marks its 25th anniversary worldwide, celebrating a quarter century of distinctive design, driving excitement, and passionate community around models that now include the MINI Cooper, MINI Cooper S, MINI Countryman, and the MINI Convertible.

The milestone year also marks 24 years of MINI in the United States since the brand’s official relaunch in the market. As of March 2026, MINI USA has surpassed 1 million vehicles sold in the United States since the brand went on sale here on March 22, 2002, underscoring the enduring appeal of MINI’s “go-kart feeling” and unmistakable personality.*

“The United States has played a vital role in the success story of MINI over the past quarter century,” said Kate Alini, Head of Marketing, Product, and Strategy for MINI USA. “From our first public debut to passionate owners and enthusiast communities across the country, the U.S. has been central to some of the brand’s most memorable moments, and we look forward to growing the MINI spirit for generations to come.”

A Strong U.S. Connection from the Beginning

The modern MINI brand first captured American attention with its U.S. debut at the North American International Auto Show on January 8, 2001, where the reborn icon introduced a new generation of drivers to the brand’s blend of heritage and innovation.

Even before that debut, the United States helped create one of MINI’s most memorable publicity moments. On August 25, 1999, MINI enthusiasts in New York City packed 25 people into a classic Mini, breaking the previous Guinness World Records mark and demonstrating the playful spirit that has long defined the brand and its fans.

Momentum continued into 2002 when the high-performance MINI Cooper S made its U.S. debut at the Los Angeles Auto Show in January 2002, further cementing MINI’s reputation for delivering engaging performance in a compact package.

A Dramatic Convertible Debut in New York

The MINI Convertible made its U.S. debut on April 7, 2004, at the New York International Auto Show, during a first-of-its-kind outdoor press conference staged in front of the Jacob K. Javits Convention Center.

In true MINI fashion, the reveal featured two MINI Convertibles performing high-speed parking brake stops before sliding into position in front of the venue, creating one of the most memorable and unconventional vehicle debuts in auto show history.

Celebrating the MINI Community

This year also marks 20 years since the first MINI TAKES THE STATES, which debuted in 2006. Since then, MINI USA has celebrated the spirit and passion of MINI owners and fans by hosting epic road trips across different regions of the United States.

Held every two years, MINI TAKES THE STATES has grown into one of the most celebrated recurring road trips in the country, bringing together thousands of MINI enthusiasts for unforgettable journeys across America.

During the most recent event in 2024, nearly 2,000 MINI owners participated in at least part of the nine-day journey through the western United States. Each morning, an average of 650 MINIs set off together, greeted by music, cheers, and the unmistakable sound of engines revving, creating a colorful rolling celebration of the MINI community.

The First MINI Sold in the U.S.

When sales officially began on March 22, 2002, the first retail MINI sold in the United States was a MINI Cooper delivered by MINI of Peabody to a car collector in the Boston area.

The buyer had been captivated by the car since seeing it during its Detroit auto show debut and placed an early order. His MINI was finished in the brand’s classic red body with a white roof, a tribute to the legendary victory of the classic MINI in the 1964 Monte Carlo Rally.

25 Years of Driving Fun

Since the launch of the modern MINI in 2001, the brand has grown from a single model into a diverse lineup spanning 2-doors, 4-doors, convertibles, and versatile SUVs. Throughout its evolution, MINI has remained true to its original philosophy: iconic design, clever use of space, and the unmistakable fun-to-drive character that defines every MINI.

With over 6.5 million MINIs sold world-wide including the more than one million vehicles now sold in the United States, MINI’s enthusiastic owner community and distinctive vehicles continue to make the brand one of the most fun and recognizable names in the automotive world.

As MINI celebrates 25 years of the modern brand in 2026, the company looks ahead to a new era of innovation while staying true to the playful spirit that has defined MINI for generations.

  * Based on Experian Automotive US registration data for all new MINI vehicle registrations 2002 to-date. Includes personal, commercial, small business, and fleet registrations.

  About MINI in the US

MINI is an independent brand of the BMW Group. In the United States, MINI USA operates as a business unit of BMW of North America, LLC, located in Woodcliff Lake, New Jersey and includes the marketing and sales organizations for the MINI brand. The authorized MINI USA dealer organization is represented by a network of 105 MINI full passenger car sales and service dealers located throughout the US. MINI USA began selling vehicles in the U.S. in 2002 with the introduction of the MINI Cooper and MINI Cooper S Hardtops. Since then, the MINI Brand in the U.S. has grown to encompass a model range of five unique vehicles.

Journalist note:  Media information about MINI and its products is available to journalists on-line at https://newsroom.bmwgroup.com/global/en.

#  #  #

- Check against delivery –

Statement 

Walter Mertl

Member of the Board of Management of BMW AG, Finance

Annual Conference 2026

BMW Welt in Munich , 12 March 2026, 08.00 a.m.

Good morning,

Ladies and Gentlemen,

For the BMW Group, 2025 was marked by fully leveraging our operating model to deliver solid results in the face of a challenging environment.

The year was heavily impacted by tariffs, developments on currency markets, especially in the second half of the year, as well as the intense market situation in China.

In the face of these headwinds:

• we executed consistently on our strategy and took advantage of our flexible global structures.
• we balanced sales across our regions and our brands.
• we reduced R&D and capex thanks to early investments in the NEUE KLASSE; and
• we drove further cost reductions across the entire company.

SLIDE: OVERVIEW OF PERFORMANCE FY 2025

With this, we were able to deliver on major KPIs in our operational business:

• a stable Group-EBT margin of 7.7% – the same as 2024 – with Group earnings of more than 10 billion euros;
• volume growth to 2.46 million Group vehicles;
• the continuation of our electrification story with an increase in BEV share to almost 18% and xEV share to over 26% of total sales;
• an electrified share in Europe of over 40%;
• a CO₂ fleet emissions figure in the European Union of 90.0 grams per kilometre – 2.9 grams below the applicable target;
• an Auto EBIT margin within our guided corridor;
• over 3 billion euros Free Cash Flow;
• and solid capital returns.

As I promised at the Annual Conference one year ago, we have addressed all aspects of cost – R&D, SG&A, manufacturing and material costs – to secure a consistent year-over-year reduction in every quarter. This amounted to an overall Auto EBIT tailwind of approximately 2.5 billion euros for the year.

With our diligent management of the business, we have been able to offset a large share of the challenges we faced. Without the full-year tariff burden of approximately 1.5 percentage points of EBIT margin, both our Group earnings as well as our Auto EBIT would have been above the previous year.

Let me now take you through our financial figures in detail.

SLIDE: GROUP FIGURES

For the full year, Group revenues totalled 133 billion euros. Earnings before Tax at Group level amounted to over 10 billion euros, as anticipated at Q3. This represents a single-digit percentage decline of 6.7%. The resulting Group EBT Margin remained stable at 7.7% for the year. Earnings per share even rose slightly year-on-year.

SLIDE: SEGMENT PERFORMANCE

If we look at the breakdown of the Group performance by segment:

The Automotive Segment delivered 6.3 billion euros in earnings with an EBIT margin of 5.3%.

Motorrad EBIT reached 178 million euros with a margin of 5.7%.

Financial Services generated 2.4 billion euros in earnings before tax and a Return on Equity of 14.3%.

All three operational segments were therefore within their respective guidance corridors.

Other Entities improved to just over 1 billion euros in EBT. The positive trend after nine months continued into Q4.

And finally, Eliminations amounted to an EBT of 629 million euros. This reflects the positive development in Q4, as anticipated.

Let’s look at how the Automotive Segment performed across key metrics:

SLIDE: BMW GROUP SALES GLOBALLY AND BY REGION

Over the course of 2025, the BMW Group sold over 2.46 million BMW, MINI and Rolls-Royce vehicles to customers worldwide, an increase of 0.5% over 2024.

Looking at the regions, we see our global model at play, as we steer effectively across geographies. As Oliver Zipse highlighted before, sales in Europe and the United States outperformed the market, delivering an increased market share and overcompensating the development in China.

We delivered a stable monthly run-rate for the BMW brand of around 50,000 vehicles throughout the entire year in China – despite the intense market environment. During the course of the year, we have taken actions to consolidate dealer structures and address pricing, which will underpin this stability in the market.

Excluding the Chinese market, global Group sales in 2025 grew by 5.9%.

SLIDE: BMW ELECTRIFIED AND BEV SALES GLOBALLY AND BY REGION

Electrified vehicles are both a foundational pillar in our strategy, and also a key growth driver – thanks to our expanding portfolio of attractive products.

Oliver Zipse has already taken you through the figures in detail. But the highlights were:

• a total of 642,000 electrified vehicles delivered in 2025;
• representing solid growth of 8.2% and an overall xEV share of over 26%.
• and deliveries of all-electric vehicles of 442,000 units for a share of almost 18%.

SLIDE: AUTOMOTIVE SEGMENT REVENUES

Revenues in the Automotive segment came in at nearly 118 billion euros, 5.9% below 2024. Approximately half of this decrease is due to negative currency effects. The remainder results mainly from global pricing pressure.

SLIDE: AUTOMOTIVE EBIT BRIDGE

Let’s look at the year-on-year Automotive EBIT result in detail, coming from our previous year’s earnings.

The net balance of currency and raw material positions resulted in a headwind of 600 million euros. Negative trends in FX outweighed the slight positive effects from raw materials, particularly in the second half of the year. This adverse FX development is expected to carry into the first half of the current year, mainly in Q1.

Compared to 2024, the net effect of volume, model mix and pricing weighed on Automotive EBIT by a total of 1.8 billion euros. The overall mix effect was positive, driven notably by a strong share from the mid-class including 5 Series growth as well as a record M performance. For the full year, pricing was a significant headwind of 2 billion euros.

In line with our planning, we continued to decrease operating costs in 2025. As planned, we reduced R&D expenses following the peak in 2024 – with a nearly 800-million-euro reduction year-on-year. SG&A savings represented 900 million euros, continuing the trend from the first nine months.

Other Cost Changes amounted to a headwind of 800 million euros. This development resulted from a few areas:

On the one hand, tariffs had a negative impact of approximately 1.5 percentage points on the Auto EBIT margin. In addition, a softening market on residual values weighed on earnings. They remained positive, but lower than the previous year.

On the other hand, warranty expenses were significantly lower year-on-year, as outlined at Q3. An additional positive effect came from a high three-digit million saving in manufacturing and material costs.

Overall, we reduced costs by 2.5 billion euros for the full year through our active steering of R&D, SG&A and manufacturing and material costs. Through this, we were able to offset all headwinds except a portion of the approximately 1.5 percentage point tariff burden, resulting in a net year-on-year decrease of 1 percentage point in EBIT.

In total, segment earnings in 2025 reached 6.3 billion euros.

The reported Automotive EBIT margin came in at 5.3%. Excluding the 1.3 billion euros depreciation resulting from the PPA of BMW Brilliance Automotive, the EBIT margin reached 6.4% for the year. And that still includes the headwind of approximately
1.5 percentage points from tariffs.

As you know, our focus is consistently on our reported figures. Due to different approaches in the industry, however, consideration of PPA and Tariff burden ensures better comparability of operational performance.

SLIDE: R&D EXPENDITURE

Looking at R&D and Capital Expenditure in detail:

We made early investments to implement our strategy, which we see as we look at R&D and CapEx development in 2025.

Group expenditure for research and development according to the German Commercial Code for the year amounted to 8.3 billion euros. This is a decrease of nearly 800 million euros, or 8% below the peak of 9.1 billion euros in 2024. This translates to an R&D ratio of 6.2%. Given the lower revenue, the ratio only declined slightly year-on-year.

SLIDE: GROUP CAPITAL EXPENDITURE

Group capital expenditure totalled 7.2 billion euros, a year-on-year decrease of over 1.8 billion euros from the peak of 9.1 billion in 2024 – or a 20% reduction. This resulted in a ratio of 5.4%. The capex ratio excluding right-of-use assets came in at 4.9%.

As promised, R&D and capital expenditure have already significantly decreased from their peak in financial year 2024. Despite the rollout of models of the NEUE KLASSE, we will maintain this trend going forward. This means in both absolute and relative terms, we’re heading back towards our strategic corridors, which are 4 to 5% for R&D and less than 5% for Capex – by 2027.

SLIDE: AUTOMOTIVE FCF BRIDGE

Moving to free cash flow:

Total segment earnings before tax amounted to 5.9 billion euros for the year.

Working Capital contributed positively with 900 million euros, mainly due to strict management of inventories.   

The net effect from capital expenditure and depreciation reduced free cash flow by 2.3 billion euros.

Changes to provisions had a negative impact of 1.3 billion euros, mainly due to the utilization of warranty provisions.

Following the 2.7-billion-euro figure communicated at Q3, free cash flow developed positively in Q4 and reached 3.2 billion euros at year-end. This was in line with our expectations of above 2.5 billion euros for the year.

Our financial strength is further underscored by our Automotive net financial assets. At year end, this came in at over 44 billion euros.

SLIDE: FINANCIAL SERVICES SEGMENT

Let’s now turn to our Financial Services segment.

As a key component of our BMW ecosystem, the segment consistently contributes to Group profitability.

In 2025, new business developed positively throughout the year with nearly 1.73 million new financing and leasing contracts concluded. This represents growth of almost 2% year on year.

The increase is due in particular to the positive business development in Europe as well as the changed competitive environment in China in the second half of the year. Since the end of June, the market situation has been influenced by the significant reduction in commissions from local Chinese banks in connection with the brokering of financial and insurance products for end customers.

Penetration rates for lease and loan offerings increased by 4.0 percentage points to 46.6%.

Overall, new business volume at Financial Services reached an all-time high, growing by 2% to 65.8 billion euros, despite negative currency effects.

Segment earnings before tax reached 2.4 billion euros. The moderate decrease compared to 2024 is due to lower income from the resale of end-of-lease vehicles, as well as a tax payment related to changed assessments of operating taxes from previous years. Residual values remain positive, but lower than the previous year.

The credit loss ratio of 0.28% was within our expectations.

Return on Equity for the full year reached 14.3% and therefore within the guided target corridor of 13 to 16%.

SLIDE: DIVIDEND AND PAYOUT RATIO

Ladies and Gentlemen,

In 2025, the BMW Group achieved Group earnings before tax of 10.24 billion euros. Thanks to a stable year-on-year profit attributable to shareholders of BMW AG amounting to 7.29 billion euros, the Board of Management and the Supervisory Board will propose to the Annual General Meeting a total dividend payment of 2.67 billion euros.

The proposed dividend represents a payout ratio of 36.6%, which is consistent year-over-year and in the upper half of our strategic target range of 30 to 40%. This amounts to a dividend of 4.40 euros per share of ordinary stock and 4.42 euros per share of preferred stock.

Additionally, we completed the second share buyback program in early 2025 before starting the third program after the AGM in May. The total from both programs amounted to a payout of 1.25 billion euros in 2025. Our third share buyback program will run until April 2027. We are currently running the second tranche of this program – with a volume of 625 million euros for ordinary shares – that will be completed by August 31, 2026, at the latest. The third tranche is earmarked for after that.

For the financial year 2025, the total shareholder return of close to 4 billion euros – comprising the proposed dividend and share buyback – exceeds free cashflow in the Automotive segment. This further underscores our commitment to capital returns.

SLIDE: OUTLOOK 2026

That brings me to our outlook for the current financial year.

What are our expectations for 2026?

In Europe and the USA, we see some growth potential.

In China, we have responded to the market environment by taking a number of steps to stabilise transaction prices. Average sales figures over the past few months indicate that sales in China could reach last year's level.  

Consequently, we forecast global deliveries of BMW, MINI and Rolls-Royce vehicles to be at previous year’s level. Due to model cycle effects as well as shifting regulatory and market dynamics, we also expect the share of fully electric vehicles to be at the same level as previous year.  

Turning to Auto EBIT development: we continue to work diligently on reducing costs and will see tailwinds from reduced investments, lower manufacturing and material costs, declining R&D expenditure as well as reduced SG&A in the 2026 financial year. We anticipate a negative impact of approximately 1.25 percentage points from tariffs on the Auto EBIT margin – compared to the 1.5 in 2025.

Given the significant investments made into NEUE KLASSE in preceding years, we will see a material increase in depreciation and amortization from both capex and capitalized R&D. While we will continue to make significant reductions in R&D expenditure, the additional depreciation and a lower R&D capitalization ratio, which is expected in the 30% area, will result in a significant P&L burden. Other headwinds in 2026 include FX and raw materials; the measures taken in China to stabilize transaction prices; and, finally, lower income from used car remarketing.

The reductions we will achieve on the cost side will not fully offset these headwinds. We therefore expect an Auto EBIT margin in the corridor of 4 to 6% in 2026. The corresponding RoCE in the Automotive segment is forecast to be between 6 and 10%. 

In the Financial Services segment, we again anticipate a Return on Equity of 13 to 16%.

Putting this all together, we expect Group Earnings before tax to be moderately lower than the strong result in 2025.

The full 2026 outlook for all key performance indicators is available in the BMW Group Report.

In addition, we expect a Free Cash Flow in the Automotive Segment at year-end of over 4.5 billion euros.

Ladies and Gentlemen,

For 2026, we will continue to systematically implement our strategic course, particularly with the launch of NEUE KLASSE product offensive and the rollout of its technologies across the portfolio. We will leverage flexibility in our global business model to tackle the challenging and dynamic operating environment.

At the same time, we will manage our operational business with continued focus on cost discipline. This will enable us to deliver financial results in line with our guidance and generate strong returns to shareholders.

Ladies and Gentlemen,

Let me pick back up on Oliver Zipse’s comments on sustainability and CO₂ emission reporting, before I hand back over to him.

For the BMW Group, we view sustainability holistically and as a competitive advantage. That is why we in our Annual Reporting disclose our sustainability performance fully to our investors and customers.

In line with our strategy and our commitment to the Paris Climate Agreement, the BMW Group considers the CO₂ emissions of vehicles – both for the new and existing fleet –over their entire life cycle: from raw material extraction and parts production to the manufacture of vehicles and across the use phase to end of life. We address all stages of the value chain with ambitious targets.

However, European CO₂ fleet emission regulations focus only on the use phase and do not recognize the full reduction potential along the entire value chain.

When it comes to reporting, emissions shown in sustainability statements do not always correlate to the actual generation of emissions of all vehicles on roads. For the 2025 financial year, the BMW Group reporting includes all vehicles sold in the year across their life cycle, including the CO₂ emissions from the supply chain for vehicles produced in the reporting year; from BMW Group production; from the assumed use phase of 200,000 kilometres for vehicles delivered in the reporting year based on the consumption mix of the reporting year; and from end-of-life disposal for vehicles produced in the reporting year.

However, the use phase emissions reported in line with European reporting frameworks do not consider all existing BMW Group vehicles still in use, but rather only those vehicles sold in the reported year.  

This means that the European reporting framework neglects the reduction potential of the existing vehicle fleet. Here, there is significant leverage to quickly contribute to CO₂ reductions through use of eFuels and carbon neutral fuels such as HVO100. Immediate credit should be given – starting, for example, in 2027 – for the CO₂ reductions achieved using sustainable fuels, which should not be subject to limitations, such as caps on specific gram per kilometre values.

The European regulatory frameworks should reflect this holistic approach towards reducing overall emissions in the here and now – in both the new and existing vehicle fleet.

Because ultimately, every gram of CO₂ saved counts. That is what we at the BMW Group believe and what makes a true societal impact.

I’ll now hand back over to Oliver Zipse to provide additional strategic insights for 2026 and beyond.

- Check against delivery –

Statement 

Oliver Zipse

Chairman of the Board of Management of BMW AG

Annual Conference 2026

BMW Welt in Munich , 12 March 2026, 08.00 a.m.

Part I

Good morning, Ladies and Gentlemen,

2025 was, in many ways, a remarkable year for the BMW Group – above all, one that set our course for the future.

First:

We achieved a solid financial result, with Group earnings of more than 10 billion euros. Walter Mertl will provide more detail in just a moment.

Second:

We grew in 2025 – selling more vehicles than the previous year and expanding our leadership of the global premium segment.

Third:

Our technology-open strategy continued to demonstrate its strength. Demand for cars with combustion engines remained stable, while sales of our all-electric and electrified vehicles continued to grow.

Fourth:

Once again, through our own efforts, we significantly outperformed the EU’s CO₂ fleet targets for 2025.

And finally:

We successfully began the rollout of our NEUE KLASSE with the BMW iX3* – giving the BMW brand and the entire company crucial momentum for the future.

All of this shows: We deliver. Consistently. And continuously.

We have set the right course in recent years and do not need to change our strategic direction. In this way, we can keep the company on track for long-term success.

Standing here beside me is the new BMW iX3. This vehicle marks a pivotal moment in the BMW Group’s recent history: the series launch of our NEUE KLASSE.

Production of the iX3 has successfully ramped up at our new plant in Debrecen, Hungary. First customers have already received their vehicles. Since last week, the iX3 has been in European showrooms.

Demand for the iX3 is significantly exceeding our expectations, with strong orders from both private and fleet customers. We are also attracting many new customers who have never driven a BMW before.

Our order books for the iX3 are full and reach well into this year. We are exploiting the flexibility of our production and supplier network and increasing capacity in line with demand.

The NEUE KLASSE is a huge investment. Only a company that enjoys long-term economic success, like the BMW Group, can invest in its future on such a massive scale.

This success is built on three important parameters.

I like to call this the BMW Group’s strategic triangle.

First: Our balanced global positioning in sales and production.

Second: Our attractive product line-up across all brands, serving the entire premium segment.

And third: Our consistent strategic focus on technology openness.

I’ll talk about the last two points in the second part of my remarks, after Walter Mertl has spoken.

In 2025, we delivered around 2.46 million vehicles to customers worldwide – representing sales growth of 0.5 percent compared to the previous year.

This shows that our business model is robust and resilient.

In Europe, we increased our sales by more than seven percent – delivering more than one million vehicles to customers in Europe for the first time since before COVID.

We also made significant gains in the United States, with growth of five percent – even in a saturated market.

In our markets outside the main sales regions of Europe, the U.S. and China, we also posted growth despite the overall downward trend – with an increase of 3.4 percent over the previous year.

China remains our largest single market. However, due to the intense competitive market environment, our sales development fell short of our expectations for the year. Thanks to the strong overall performance in three of our four sales regions, we nevertheless achieved growth worldwide. This confirms the strength of our global footprint.

Our worldwide presence is a decisive competitive advantage.

All BMW Group brands contributed to our 2025 result.

Electrified models across all brands as well as the models from BMW M were the main growth drivers.

The BMW brand once again maintained its position as the global number one in its segment. Demand was particularly strong for core models like the X1, X3 and X5, as well as our 3 Series and 5 Series models.

BMW M continued its success story in impressive style in 2025 – increasing its sales for the 14th consecutive year.

With more than 213,000 vehicles delivered to customers, M reached a historic all-time high. The BMW M5* and M5 Touring* and the X3 M50* were the main drivers of this success.

This provides compelling proof of the enduring appeal and growing demand for top-level performance in the premium segment.

MINI achieved significant growth thanks to its new model family. Sales increased by nearly 18 percent compared to the previous year.

The main growth driver was the most versatile model in the line-up, the MINI Countryman+ – accounting for over 32 percent of the brand’s total volume.

MINI and electromobility are a perfect fit – and our customers clearly agree.

This is underscored by an impressive achievement in 2025: For the first time, the brand delivered more than 100,000 all-electric models to customers in a single year.

That’s more than one in every three MINIs delivered. In this way, MINI is making a major contribution to the electrification of the BMW Group.

At our ultra-luxury Rolls-Royce brand, the number of hand-built motor cars delivered to clients remained on the high level of the previous year.

The value and number of requests for highly individualised Bespoke continued to increase. The Home of Rolls-Royce at Goodwood is currently being modernised and expanded, to provide more space for both Bespoke and the marque’s pinnacle Coachbuild products.

BMW Motorrad confirmed its strong market position in the premium segment in the financial year 2025.

Despite a global decline in the total market for motorcycles above 500 cc, the brand delivered more than 200,000 vehicles for the fourth year in a row.

Most notably, the R 1300 GS and F 900 GS played a key role in BMW Motorrad’s market success in 2025.

Ladies and Gentlemen,

All of this shows that our multi-brand premium approach enables stability and growth.

Another major strength of our business model is our ability to meet diverse customer preferences, different regional requirements and technological developments in parallel.

Our electrified vehicles provide the clearest proof of this:

In 2025, we delivered more than 640,000 electrified vehicles to customers worldwide. That means they accounted for about 26 percent of our total sales – with all-electric vehicles making up around 18 percent.

Europe stands out, in particular, with electrified vehicles representing over 40 percent of sales. Plug-in hybrids were also in strong demand in 2025.

All of these factors make the BMW Group one of the leading providers of electromobility in the premium segment.

Thanks to our balanced mix of efficient drive technologies and growth in electrified vehicles, we once again outperformed the legal CO₂ requirements in the European Union.

Based on our preliminary internal calculations, we achieved fleet emissions of 90 grams of CO₂ per kilometre in Europe in 2025.

That once again places us well below the legal target – entirely through our own efforts. We do not need to rely on pooling with other manufacturers or averaging over several years.

This provides clear evidence that technology openness and effective climate protection are not mutually exclusive – but go hand in hand.

The BMW Group remains fully committed to the goals of the Paris Climate Agreement – while setting our own ambitious targets.

For example, by 2035, we aim to reduce our CO₂ emissions by at least 60 million tonnes compared to 2019 levels – and we intend to hold ourselves accountable to this target.

We are charting our own course – something that is more important now than ever before.

On the one hand, we see that regulatory frameworks in individual markets can be extremely volatile.

On the other, we are convinced that the EU experiment of mandating electrification will not deliver the desired results – to the contrary.

For this reason, we continue to pursue a long-term, holistic decarbonisation strategy.

We are committed to providing solutions not only for new vehicles, but also for the existing fleet on the roads – based on technology openness across the entire lifecycle of our vehicles.

And for this reason, we also integrate fuels such as HVO100 and advocate for 100 percent credit in CO₂ calculations. In addition, recognising and crediting green steel would strengthen the European steel industry and safeguard jobs in Europe. Using more recycled materials in new cars reduces our climate footprint – as demonstrated by our NEUE KLASSE.

A holistic approach strengthens European value chains, secures jobs and keeps the industry competitive. At the same time, it enables effective climate protection and real CO₂ reductions.

Companies should be free to provide solutions geared towards customer needs, while also investing in appropriate new technologies to meet the European Union’s climate goals.

As a global player, we stand for free trade and collaboration. We do not believe in protectionism, but rather in the power of innovation to compete on the global stage.

However, with the Industrial Accelerator Act, the EU Commission is continuing its protectionist course while not addressing home-made challenges like high energy prices.

One thing is clear: without international value chains, the ramp-up of electromobility and the development of powerful battery technologies are not feasible.

Labels such as “Made in the EU” or “Union origin” disadvantage European companies with global value chains if they do not recognize that each Euro spent in Europe counts the same for prosperity and jobs. No matter if the car stays in Europe or is exported.

Instead, the development of expertise and production for battery cell technologies in the EU should be promoted and effectively incentivized as fast as possible.

This year, together with policymakers, we must find realistic solutions that allow us to achieve our climate goals and to strengthen our economy and competitiveness.

Ladies and Gentlemen,

2025 was shaped by very different developments:
strong growth in Europe and the US, a much more challenging situation in China, rising competitive pressure and additional headwinds from tariffs.

Nevertheless, the BMW Group continues to deliver a stable performance.

Because we acted early. We adjusted our internal cost structures and maintained our strategic direction.

This combination of strong operating performance today and a clear long-term perspective is a crucial success factor for our company.

And that brings me back to the vehicle standing next to me.

The iX3 and the technologies of the NEUE KLASSE testify to our innovation and performance.

It underlines that we are “already ahead”.

Walter Mertl will explain in more detail how our strong operating performance is reflected in our financial figures.

We will then take a look at 2026, with more new products on the way.

Part II

Ladies and Gentlemen,

Looking ahead to this year and beyond, three key factors will be decisive:

First:
For our 2026 targets: the product line-up currently available, which we have built up gradually over the past few years.

Second: 
For this year and the years to come: the rollout of additional NEUE KLASSE models and integration of its technologies across the entire product range.

And third: 
The tech clusters of the NEUE KLASSE, which enable rapid advances and collaboration with leading tech players worldwide.

Let’s start with the first item:

The company’s current product portfolio across our BMW, MINI, Rolls-Royce and BMW Motorrad brands offers a range of premium options in all key segments.

From MINI, in the urban compact-car segment, to Rolls-Royce, in the ultra-luxury class.

At the beginning of this year, we added another highly exclusive dimension to our brand portfolio: BMW ALPINA.

The long-established BMW ALPINA brand embodies maximum performance and exceptional driving comfort, combined with unique options for individualisation.

This makes it an ideal addition to our existing product range in the segment for individual, highly customised vehicles.

In this way, we are tapping into a highly profitable segment with great growth potential, positioned above the BMW brand’s top models and below our Rolls-Royce luxury brand.

Overall, the BMW Group offers one of the industry’s most comprehensive and diverse premium portfolios.

A core strength of this line-up is our consistent focus on technology openness. We committed early to a market-driven mix of different drive technologies.

With this approach, the BMW Group continues to chart its own course – enabling us to systematically respond to the diverse requirements of markets and customers well into the future.

Because we chose this path early, making the necessary investments at the right time, we can now fully realise the market potential of our products.

Today, we offer battery-electric vehicles in all relevant segments. By the end of the year, we will have a total of 20 BEVs across all brands. This will further strengthen our competitive position.

At the same time, plug-in hybrids also remain important.

This is not just a “bridging technology” – for many people, in all regions of the world, they are the only way to integrate electric, locally emission-free mobility into their everyday lives.

Together with our range of highly efficient combustion engines, this approach provides maximum flexibility – ensuring that regional market opportunities can be consistently exploited.

This strong line-up lays the core foundation for the company’s business success in 2026 – and beyond.

At the same time – and that brings me to my second point – we are systematically building on our current advantage with the NEUE KLASSE.

With the release of the BMW iX3, the market launch of the NEUE KLASSE has just begun.

But this is only the start.

Additional all-electric models with the new design and innovations of the NEUE KLASSE will follow.

Another notable highlight will be unveiled next week, when we present the BMW i3, the first variant of the next generation of the BMW 3 Series.

The new i3 brings our NEUE KLASSE right into the heart of the BMW brand.

Prepare to be amazed by what the technologies of the NEUE KLASSE can do in a vehicle like the 3 Series. It is fair to say that they take “Sheer Driving Pleasure” to a whole new level.

Here’s a sneak preview of what we will be unveiling 
next week.

Ladies and Gentlemen,

I’m looking forward to presenting this incredible car to our BMW fans worldwide next week.

After that, we will meet again at Auto China in Beijing, to introduce the Chinese version of the iX3 as the next NEUE KLASSE model.

We developed this vehicle exclusively for China, together with our local R&D team in the market.

By doing so we ensured that the product meets the specific wishes and needs of our Chinese customers.

The result: The most Chinese car we have ever built.

Initial feedback from the local media has been overwhelmingly positive – with praise, in particular, for its driving characteristics. The China-specific digital features have also been very well received.

In 2027, BMW M will usher in a new era in the high‑performance segment – with the first all-electric M vehicle with racetrack capabilities, based on the NEUE KLASSE.

Alongside development of the NEUE KLASSE, we have also created the essential conditions for a rapid ramp-up within our supplier and production network.

Production of the iX3 has successfully begun at our new plant in Debrecen.

We will start production of the new BMW i3 at our main plant here in Munich in the second half of the year. To do so, we have completely modernised the plant during ongoing operations.

From late 2027, we will build only electric vehicles in Munich.

Production of high-voltage batteries will also begin at our new plant in Irlbach-Straßkirchen in the second half of the year. This facility will supply our plants in Germany with our sixth-generation high-voltage batteries.

Our plant cluster in Shenyang, China, is also ready to build the NEUE KLASSE in China, for China.

At our largest plant, in Spartanburg in the U.S., we are systematically modernising the production system for the technologies of the NEUE KLASSE. This also includes the new high-voltage battery assembly facility in nearby Woodruff.

Across all plants in our production network, we are creating the necessary conditions to implement the technologies of the NEUE KLASSE as quickly as possible in all BMW models.

Between now and 2027 alone, we will bring more than 40 new or updated models to market.

Each of them will benefit from the technologies of the NEUE KLASSE – always tailored to concept requirements and independent of the drive technology.

The best example of this is the next generation of our BMW X5. This summer, we will officially unveil the successor to our current model.

The X5 will be the first BMW model to be offered with five different drivetrain variants: with highly efficient conventional drives, as a plug-in hybrid, battery-electric and – from 2028 – also powered by hydrogen.

In this way, we are laying the foundation to successfully meet the diverse requirements and customer needs around the world, both today and in the future.

Shortly before that, at the Beijing show, we will be showcasing the first model update to feature technologies from the NEUE KLASSE: the BMW 7 Series.

The result is an almost completely new vehicle. We are taking full advantage of the new possibilities from NEUE KLASSE technologies and raising our luxury sedan to a whole new level in terms of both appearance and technology.

That brings me to my third point:
the technology clusters of the NEUE KLASSE and their potential.

With the technology clusters developed specifically for the NEUE KLASSE and our modular approach to technology, we can integrate market-specific functionalities and content into our vehicles.

At the same time, we are strengthening our R&D capabilities to enable us to respond more quickly and flexibly to local customer needs and provide appropriate solutions.

In our key sales regions, we have already implemented numerous features in collaboration with leading local partners.

For example, in the Chinese market, we are working with Alibaba Banma to establish the next generation of intuitive in-car voice control.

In China, the BMW Intelligent Personal Assistant is also being expanded to include DeepSeek functionality.

In most markets, including Europe, we will be integrating Alexa+ as the centrepiece of our BMW Intelligent Personal Assistant.

Thanks to the advanced Large Language Model technology of Amazon Alexa+, our customers now benefit from an even smarter, more connected and highly personalised voice assistant.

With our driver assistance systems, we continue delivering the best-possible customer experience in each region – tailored to local requirements.

To achieve this, we work closely with selected partners.
Our guiding principle remains the same: We always strive for smart, symbiotic and safe solutions.

Last summer, we launched a new cooperation in China with Momenta. A leading local provider of ADAS technology. Outside China, we are collaborating with the American company Qualcomm.

Both collaborations focus on the co-development and integration of software that adapts to different road conditions, traffic scenarios and user needs – relying on state-of-the-art AI algorithms and data-driven methods.

These examples highlight the extraordinary flexibility and scalability of our tech clusters.

With the software-defined NEUE KLASSE, we maintain control over all systems and can deploy them simultaneously worldwide.

We are also able to rapidly integrate local technology stacks, giving our customers access to their preferred innovations and features.

Continuous over-the-air updates ensure that our vehicle software is always up to date. All functionalities are improved on an ongoing basis to permanently enhance the customer experience.

Ladies and Gentlemen,

As you can see, the BMW Group remains successful and highly innovative. Our current product range is one of the broadest and most attractive line-ups in the premium segment worldwide.

With the NEUE KLASSE and its technologies, we have secured a significant competitive advantage. We will leverage these strengths to drive our economic success.

However, it is also clear that our world remains unstable, and numerous risks will persist in the current financial year.

We meet these challenges with strategic consistency and with market- and opportunity-driven vision.

Our global footprint – in sales, research and development, and production – provides us with the foundation to mitigate uncertainties and respond flexibly to unforeseen events.

We will continue to build on these strengths in 2026 and in the years to come.

Thank you very much.

• World premiere of an exclusive, limited-production ALPINA model for the United States and Canada — full details released Friday, March 6 at 2:15 PM ET.
• BMW Classic USA presents a six-generation BMW M3 display at The Amelia Concours 2026, marking 40 years of the iconic sports sedan.
• Sunday's Cars & Caffeine event celebrates three BMW milestones: 40 years of the M3, 50 years of the 6 Series, and 60 years of the BMW 2002.

Fernandina Beach, FL – March 2, 2026…At The 31st Amelia Concours d'Elegance, held March 6–8, 2026, at the Golf Club of Amelia Island and The Ritz-Carlton Resort, BMW will mark three milestones in its performance heritage — 40 years of the BMW M3, 50 years of the BMW 6 Series, and 60 years of the BMW 2002 — alongside the world premiere of an exclusive, limited-production ALPINA model for the United States and Canada.

North American Debut: An Exclusive ALPINA Model for the United States and Canada.

BMW’s activities at The Amelia Concours 2026 begin on Friday with the debut of an exclusive, limited-production model for the United States and Canada. ALPINA has long defined a singular expression of maximum performance and supreme ride comfort — an exceptional balance that has made the marque revered among connoisseurs of refined performance.

Full details remain under embargo until the reveal on Friday, March 6, 2026, at 2:15 PM ET / 11:15 AM PT. The new ALPINA model will remain on display at the main entrance to The Ritz-Carlton throughout the weekend of The Amelia Concours 2026.

40 Years of the BMW M3: Six Generations on Display at The Amelia Concours 2026

2026 marks 40 years since the introduction of the BMW M3 — released in 1986 as a homologation special for Group A racing competition. At The Amelia Concours 2026, BMW Classic USA will present a curated six-generation display tracing the M3's evolution from the E30 to the current G8x, with each example illustrating the direct connection between BMW Motorsport's racing development and the road cars BMW M has delivered to customers worldwide.

1^st Generation: E30 - The BMW E30 3 Series spawned the first BMW M3 – a car designed by BMW Motorsport to represent BMW in race series around the world. Initially, 5000 street examples needed to be produced to homologate the car for Group A competition. The car that will be on display is one of 600 1990 Sport Evolution street examples produced to allow further racing development. It is equipped with a 2.5-liter 4-cylinder engine, revised aerodynamics and 18-inch wheels. Through the course of its racing career, E30 M3 became the most successful racing sports touring car ever.

2^nd Generation: E36 - Although the E36 M3 was raced very successfully in the US and Europe, its primary focus was performance on the road. The E36 M3 was the only generation with a unique engine for the US market; a 240 hp 3.2-liter inline-6, and the first M3 offered as a sedan and convertible as well as a coupe. The formula was successful; the E36 M3 was on Car and Driver’s 10Best list every year it was in production. The pinnacle of the E36 M3 in the US was the limited edition M3 Lightweight displayed – available only in white with the Motorsport checkered flag motif. This track-focused model deleted the air conditioning and other comfort and convenience features and had aluminum doors, all of which made it 200 pounds lighter than the stock M3 coupe. It also featured an adjustable front splitter, a rear wing, and an oil scavenge pump.

3^rd Generation: E46 - The E46 M3 continued the evolution of The Ultimate Driving Machine with a somewhat larger yet significantly stiffer body shell than the E36 it replaced. The third generation M3 was offered as a coupe and convertible and was powered by a high revving, 333 hp 3.2-liter inline 6-cylinder engine paired with either a 6-speed manual or 6-speed SMG-II transmission. A highly successful sales leader in its day, the E46 M3 is today revered as one of the all-time best handling cars. The E46 M3 GTR race version became a dominant force in racing around the world – both with 6-cylinder and V8 power. The example on display is a well preserved 2006 model.

4^th Generation: E92 - The E9x M3 is the only road-going M3 to be powered by a V8 engine. The 4-liter, 414 hp V8 with an 8,300 RPM redline was a masterpiece of engineering and could be paired with either a 6-speed manual or a fast-shifting M-DCT double-clutch gearbox. High US demand meant the fourth generation M3 was again offered as a sedan as well as a coupe and convertible. The E9x was the first M3 to include the BMW iDrive system to control navigation, infotainment, and essential vehicle functions. It was also a remarkably successful race car, sweeping the ALMS Championship in 2011 and winning the 12hrs of Sebring in 2011 and 2012. The example shown here is one of 200 US market-only M3 Lime Rock Park Editions produced in 2013.

5^th Generation: F8x - The 5th generation saw substantial changes for the M3/M4. Going forward, coupes and convertibles would be badged M4s, with the M3 badge reserved for the sedan. The F8x generation was the first one turbocharged, powered by a new S55 TwinPower Turbo inline-6 cylinder 3-liter engine developing 425 hp and 406 lb-ft of torque. Acceleration from 0-60 mph dropped to 3.9 seconds with the optional M-DCT dual clutch transmission. The peak version was the track oriented, limited production M4 GTS shown here. The hardcore GTS included extensive use of carbon fiber inside and out, a standard partial roll cage in place of the rear seats, and water injection for the higher output S55 engine.

6^th Generation: G8x - The G8x M3/M4 is the result of the continuous evolution of the definitive M sports sedan and coupe over the past four decades. Today’s M3/M4 have benefitted from extraordinary advancements in technology and engineering, improving performance, safety, efficiency, comfort, and convenience, all without compromising the emotional experience of The Ultimate Driving Machine. The G8x generation are available in rear wheel drive or xDrive all-wheel drive, with a 6-speed manual or a fast shifting 8-speed automatic derived from the GT4 race car. The example on display is a manual transmission version in BMW Individual Laguna Seca Blue with accessories from BMW M Performance.

Saturday, March 7: The 31st Amelia Concours d'Elegance — BMW Award for Engineering Excellence

The 31st Amelia Concours d'Elegance takes place Saturday, March 7, 2026, on the fairways of the Golf Club of Amelia Island at The Ritz-Carlton Resort, featuring over 250 vehicles across 35 classes. Among the awards presented is the BMW Award for Engineering Excellence, recognizing vehicles that demonstrate forward-thinking technologies and innovations that transcend their era. The Amelia Concours d'Elegance is open from 9:30 AM to 4:00 PM.

Sunday, March 8: Cars & Caffeine Celebrates 50 Years of the BMW 6 Series and 60 Years of the BMW 2002

Sunday, March 8, Cars & Caffeine at the Golf Club of Amelia Island will feature over 400 vehicles. BMW Classic USA will mark three milestone anniversaries: 40 years of the BMW M3, 50 years of the BMW 6 Series, and 60 years of the BMW 2002 — with dozens of excellent examples from each model's history entered by members of the BMW Car Club of America. Cars & Caffeine runs from 9:00 AM to 1:00 PM.

BMW Group in the United States

BMW Group began operations in the U.S. over 50 years ago. In addition to the sales, marketing, and distribution of BMW, MINI, Rolls-Royce, and BMW Motorrad vehicles, BMW Group’s business in the U.S. spans 30 locations in 12 states including BMW Group Financial Services, BMW Manufacturing, Designworks, BMW Technology Office USA, and BMW i Ventures. The company’s U.S. plant in South Carolina is the largest single BMW production facility in the world and the global center of competence for BMW Sports Activity Vehicles. The BMW Group sales organization is represented by a nationwide network of 355 BMW retailers, 147 BMW motorcycle retailers, 105 MINI passenger car dealers, and 37 Rolls-Royce Motor Car dealers. Taken together, BMW Group’s business activities in the U.S. provide and support over 120,000 jobs and contribute more than $43.3 billion to the U.S. economy annually.

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Journalists note: For more information about BMW Group’s business and products in the U.S., please visit: PressClub USA.

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• BMW is an official partner for this year’s edition of Art Basel Miami Beach, taking place December 5 to 7, 2025.
• A special event featuring Yanko will explore the intersection of automotive design and contemporary sculpture.
• As always, Art Basel First Choice VIP guests will have access to exclusive shuttle service in BMW’s flagship models.

Miami Beach, FL – December 4, 2025… As Art Basel’s Official Global Automotive Partner, BMW reinforces its longstanding dedication to the arts — a commitment that spans over five decades. Since 1972, BMW has championed artistic innovation through hundreds of initiatives worldwide. While the partnership with Art Basel has flourished for over 20 years, this year’s return to Art Basel Miami Beach, in collaboration with renowned artist Kennedy Yanko, marks another important chapter in BMW’s broader cultural legacy.

Known for her mastery in transforming industrial materials and “paint skins" into dynamic, fluid forms, Yanko’s work challenges conventional perceptions of materiality and motion. Her sculptural installation is a direct homage to the expressive spirit and bold aesthetics of the BMW XM Label, capturing the 738-horsepower performance SUV’s duality.  

This collaboration exemplifies a shared philosophy between Yanko and BMW’s design ethos; both rooted in experimentation and uncompromising craftsmanship. It builds on a relationship that began during Art Basel Miami Beach 2021, when Yanko helped unveil the BMW XM Concept Vehicle, previewing the bold design language of what would become the series-production BMW XM Label — the model now accompanying her work this week.

Exclusive Activation with Kennedy Yanko

Reinforcing the brand’s dedication to exclusive, world-class cultural opportunities for its valued community, on Thursday, December 4, BMW will host an intimate event offering unparalleled access to Yanko’s sculpture. A BMW XM Label finished in Santorini Blue paint by BMW Individual will compliment Yanko’s latest piece. Hussein Al Attar, Director of Automotive Design at Designworks in Santa Monica, CA, will join Yanko to share his perspective on the parallels between impactful vehicle aesthetics and the art of sculpture.

“It’s always a joy to work with BMW, a partner that understands how design can move people—literally and emotionally. My conversation with Hussein about the shared language between sculpture and automotive design revealed compelling parallels in how we each shape materials to express power, motion, and intention,” said Yanko.    

A 50-Year Legacy of Driving Culture

BMW’s expansive engagement in arts and culture covers music, architecture, design, contemporary art, and beyond. The iconic BMW Art Car Collection remains a testament to this legacy, featuring rolling masterpieces by visionaries such as Andy Warhol, Roy Lichtenstein, and Jeff Koons. From long-standing collaborations with leading cultural institutions to its enduring partnership with Art Basel across Miami Beach, Basel, and Hong Kong, BMW underscores its belief that creativity is a universal language — and a driving force for innovation, connection, and progress.

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BMW Group in the United States.

BMW of North America, LLC was established 50 years ago to support the sales, marketing and distribution of BMW automobiles in the U.S. BMW Motorrad was brought into the fold in 1980. In 1993 BMW Group Financial Services NA, LLC was founded, and one year later BMW Manufacturing Co., LLC began assembling vehicles in South Carolina. In 2002 and 2003, BMW Group established MINI USA, and Rolls-Royce Motor Cars NA, LLC relaunching two iconic brands and rounding out its product portfolio.

Today, the BMW Group has a nationwide corporate footprint in the U.S. which consists of nearly 30 locations in 12 different states. Beyond the National Sales Company and Financial Services headquarters in Woodcliff Lake, NJ, its manufacturing plant in Spartanburg, South Carolina, and numerous other operational facilities, BMW Group in the U.S. also includes Designworks, a strategic design consultancy in Santa Monica, CA, BMW Group Technology Office USA, a technology research and development center in Silicon Valley, and BMW i Ventures, a venture capital fund, also in Silicon Valley.

BMW Group Plant Spartanburg is the largest single BMW production facility in the world, and the global center of competence for BMW Sports Activity Vehicles including the X3, X4, X5, X6, X7, and XM. The plant assembles more than 1,500 vehicles each day, and up to 450,000 annually. Since 1994, Plant Spartanburg has assembled more than 7 million BMW vehicles in the U.S.

The BMW Group sales organization in the U.S. is represented through a network of 351 BMW retailers, 143 BMW motorcycle retailers, 105 MINI passenger car dealers, and 38 Rolls-Royce Motor Car dealers. The company’s activities provide and support over 120,000 jobs across the U.S. and contribute more than 43.3 billion to the U.S. economy annually.

Journalist note: Information about BMW Group and its products in the USA is available to journalists on-line at www.bmwusanews.comwww.miniusanews.com and www.press.bmwna.com

About Art Basel.

Founded in 1970 by gallerists from Basel, Art Basel today stages the world’s premier art shows for Modern and contemporary art, sited in Basel, Miami Beach, Hong Kong, Paris, and Qatar. Defined by its host city and region, each show is unique, which is reflected in its participating galleries, artworks presented, and the content of parallel programming produced in collaboration with local institutions for each edition. Art Basel’s engagement has expanded through new digital platforms including Zero 10 and the Art Basel App, and initiatives such as the Art Basel and UBS Global Art Market Report and Survey of Global Collecting, Art Basel Awards, and Art Basel Shop. For further information, please visit artbasel.com.

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If you ask former CEO Bernhard Kuhnt what BMW of North America’s associates contribute to the company’s success, his answer is simple: “Everything!”

“BMW North America’s associates are, number one, hugely diverse in the truest sense, and very professional, very motivated,” said Kuhnt, who served as CEO from 2017 to 2021. “I had a hugely enjoyable time there because the individual areas of the organization were all driven, and they all wanted to succeed.”

That’s been true since 1975, when BMW of North America replaced independent importer Max Hoffman as the distributor of BMW automobiles in the US. From the beginning, BMW NA attracted capable and energetic associates, and we’ve met quite a few past and present over the course of the previous 46 stories.  As BMW NA’s 50th anniversary year winds to a close, it’s time to focus on five associates who serve the company today. Some have worked at BMW NA for decades while others for only a few years. Regardless of tenure, all have contributed to BMW NA’s success…and all are part of its history.

As current CEO Sebastian Mackensen explains, “History is memories and the story of people. It’s where you come from and where certain values are grounded and developed over time in a company, especially through the people who carry them forward. If you want to step into the BMW family, you need to see where your colleagues come from, who shaped them, and how they are today. Everybody has a history, and you are a product of yours. I think that’s why it’s relevant to cherish it, to be mindful of it, and to be informed about and recognize the people and experiences that brought us here.” 

Tom DiGregorio, Senior Product Engineer, Chassis Systems (US Aftersales)

Tom DiGregorio had already held part-time jobs in auto parts stores and at a limousine company when he began studying automotive and diesel technology at Lincoln Technical Institute in Union, New Jersey. “BMW came to our school looking to hire people for the Jersey City Vehicle Preparation Center, which they now call the Vehicle Distribution Center,” DiGregorio said. “I didn’t know anything about BMW, but it looked like a great opportunity to start a career.”

Indeed it was, especially for a smart young technician. Joining BMW NA in 1988, DiGregorio began by readying cars for delivery and installing CD players and telephones in E32 7 Series sedans at the Vehicle Preparation Center. From there, he moved to Montvale, New Jersey and a job in BMW NA’s national workshop. Before long, he’d become Shop Foreman, and in 1997 he was named Press Vehicle Technical Coordinator. “We prepared new vehicles for the press launches, did all the repair work on those vehicles, and did support at the launches, making sure all the cars made it to their destinations defect-free,” DiGregorio said. “At the end of the day, we’d go through the cars again, make sure anything that was broken was repaired, and set them all up for the next day.”

In the mid 1990s, BMW of North America was contracted by McLaren to service the BMW M70/2 V12 powered McLaren F1 supercars in North America. DiGregorio became one of only a handful of technicians qualified to work on the McLaren F1. “I got to go to England for two weeks of training, and then came back and did all of the services for the McLarens in the US.” Earlier this year, he assisted in replacing the $25,000 windshield in the McLaren F1 GTR owned by BMW NA. “It’s my favorite car to work on, but you’d better take care and be aware of your surroundings when you work on it!”

Following a stint in BMW’s Quality Information Center, which looks for quality issues and reports its findings directly to Munich, DiGregorio spent several years as a National Technical Service Engineer, helping dealers solve problems that had stymied their own technicians and introducing remote vehicle programming. 

In 2011, DiGregorio took up his current position as Senior Product Engineer within the Aftersales division. “We write the service bulletins and the bulletins for recalls and campaigns,” he said, “and we do the Service Round Table, making videos for product improvements or helping technicians handle problems in the field.” DiGregorio specializes in chassis systems, which includes suspension, steering, and brakes. All of those components, he said, “have gone from purely mechanical to computerized—even the sway bars are electronically controlled. I’ve seen a lot of innovations since I started.”

The cars have become more digital, but diagnosis and repair remains the most satisfying part of DiGregorio’s job. “I love going down to the workshop and getting hands-on with the other technicians, communicating with them, and working with them to get the resolution.”

DiGregorio has advanced steadily throughout his nearly 40 years with BMW NA, aided by strong mentorship as well as BMW NA’s practice of moving talented and ambitious associates up the ladder. “Bob Wildonger, who recently passed away, was one of the managers while I was at the VPC, and he just took you under his wing and made sure you understood what you were doing,” DiGregorio said. “Vlodek Olczak was always engaged, and he had your back for everything—just one of the all-time great guys to work for. So was Bob Breznak, a technician who started with me, later became Area Market Manager, and then came back to the technical field. The people here have been great, and no matter where you go in any department, you always have a good working relationship and great communication.

“I worked at a domestic brand dealership for about two weeks before BMW hired me, and if I were still there I’d probably still be turning wrenches on customer vehicles. At BMW, I’ve had the opportunity to go in any number of directions, but I chose to stay in technical service because I enjoy the hands-on part of it. There’s always something new, and it’s always a challenge to work through a problem and bring resolution to the situation.”

Eileen Paletta, Team Manager, Customer Communications and Quality Assurance

While Tom DiGregorio handles problems from the technical side, Eileen Paletta takes care of the human dimension. As Team Manager for Customer Communications & Quality Assurance, she interacts with BMW owners who run into difficulties with their cars—or who want to thank BMW for making especially robust vehicles.

“When customers have serious accidents in their vehicles, whether it’s a BMW, a MINI, or even a motorcycle, some write to thank us for saving their lives,” Paletta said. “I’m honored to interact with customers who’ve had the most severe accidents—sometimes there’s nothing left of the vehicle. I’ve seen photos of vehicles that have been shot at, gone off cliffs or down ravines, taken up in tornadoes, stampeded by wild horses, hit by trains… It’s pretty incredible. I share them with our executives, my team, and the plant where the vehicle was built so the production associates can feel proud and motivated.”

Paletta has been working in Customer Relations since 2008, but she was hired by BMW of North America in January 1997. “I started as a secretary, which morphed very soon after into Events Specialist handling dealer meetings,” she said. “Before that, I led the editorial process at a company that specialized in logistics and transportation for Fortune 500 companies.”

Upon joining BMW NA, Paletta became part of a new Retail and Industry Relations department led by the company’s first head of Corporate Communications, Tom McGurn. The department handled auto shows as well as dealer relations, including the BMW Dealer Forum and MINI Dealer Council. “We had a direct line to the CEO’s office, and it was exciting to be part of several major areas within the company. I got immersed in everything, and I found everything fascinating.”

Paletta spent ten years working under McGurn, whom she cites as an important mentor along with Joan Malone, who led Retail Recognition. “Tom taught me so much about relationships and making connections with our dealers,” she said, “and I take a lot from Joan in the way she held her cool and orchestrated her day.”

When BMW NA underwent a restructuring following the financial crisis of 2008, Paletta became curious about an opening in Customer Relations. “I got the job, and that turned into the next chapter of my life,” she said. “I’ve been in this department for many years now, and I’ve had various roles within it.”

Along with handling the testimonials mentioned above, Paletta also connects with customers whose BMWs have passed important milestones on the odometer, including one that reached 460,000 miles. “We also get letters from students, so I like to promote our STEP program or the teen driving school at the Performance Center.”

Not all of her encounters with customers are positive, since some customers contact BMW NA executives to complain about problems with their vehicles. “Back in the day, it was very polite, and they’d write a nice letter, but everything has changed now,” Paletta said.

Change is part of any working environment, however, especially one built on technological progress like BMW. “Now, customer service representatives have to be savvy on so many different topics, and we have to rely on content libraries because there are so many more components,” Paletta said. “We did a lot more letter writing back in the day, but customers don’t want lengthy correspondence. They want the information right away, in quick little chats, but it has to be just as meaningful. Speaking and writing in the right tone of voice and keeping cool even when things become a little volatile is key.”

Despite those challenges, Paletta still enjoys her work in Customer Relations, and interacting with new associates. “I tell new hires that we’re excited to have them, because they’re bringing us a fresh perspective,” she said. “I don’t like hearing, ‘We’ve always done it that way,’ which frustrates me. Let’s do it differently, and let’s be creative. I think that’s what we’re about.”

Above all, she loves BMW’s products. “I’ll take different routes to work just to feel the curves,” Paletta said, “and I was one of the first people on the track at the Performance Center when it opened in 1999. Once you do timed laps in an M3, you become a little addicted! And on my first drive home in my 430i Convertible, an eagle soared directly above me. The next morning, I started leaving for work an hour early just so I could drive along the Hudson River and over the mountains, and after work I’d drive and drive and drive. I just love our cars!”

Carolyn Capozzalo, Senior Engineer, Vehicle Regulatory Standards

While associates like Paletta have spent long stints in much-loved roles, associates like Carolyn Capozzalo have followed their curiosity wherever it leads. “I like a challenge,” she said. “I love anything where I can learn.” 

Over two decades at BMW of North America, that desire to keep moving forward has seen Capozzalo advance from Receptionist to Senior Engineer, and to innovate back-end solutions that help BMW’s cars adapt to their customers’ needs.

She began her BMW career in 2002 as an employee of BMW NAs office services supplier. “I was hired to be a receptionist in Montvale, which was very quiet, but then I was asked to move to Woodcliff Lake, where I could do desktop publishing for parts bulletins and other documents that went out to dealers,” she said. “I was like, ‘Yes, please! Give me some things where I can learn and do more.’”

Three years later, Capozzalo was hired by staffing company to work in BMW NA’s Purchasing Department, and in 2007 she became an official BMW employee as an Administrative Assistant in the IT department. “They had gotten a new purchasing system that everyone hated, but I said, ‘Hey, I’ll figure it out!”

Shortly after she’d mastered the purchasing system software, Capozzalo was approached to join BMW NA’s Customer Relations department. “I said, ‘Sure, why not?’ You learn a lot when people complain, and if customers are upset about something you get to see more of the product and how the business handles it.”

Not long after she’d taken that position, BMW downsized its staffing in the wake of the 2008 financial crisis. Capozzalo’s position was eliminated, so she returned to Canon before rejoining the auto industry as a service advisor, first at a non BMW Group brand dealership and then with two MINI dealerships near Woodcliff Lake. “As much as I loved my customers and helping people take care of their cars, the hours are insane,” she said. “I’d kept in contact with friends from BMW, and in 2016 Don Law invited me to come back to work on the Parts Technical Hotline. I’m 99.99 percent sure I was the first female parts hotline person ever hired, and I basically got to learn about all the components and how to read engineering and wiring diagrams and things like that.”

The Parts Technical Hotline offices were located next to the Warranty Department at Woodcliff Lake, and it wasn’t long before George Joseph enlisted Capozzalo to join Warranty. “He was great, and when I was in Warranty I was working with Engineering,” she said. “When my counterpart in the engine emissions department went back to Germany, she suggested I apply for her position. I did, and I got a job reporting to CARB and EPA for warranty extensions for emissions-relevant parts.”

That wasn’t the end of Capozzalo’s journey within BMW NA. “In 2020, Kiri Moises said, ‘Hey, there’s a position opening up in the Connected Driving Department. What do you think about joining that?’ The team lead happened to be my customer at the MINI dealership, and so was the person I was replacing.” Capozzalo worked on analytics within Connected Drive, until team lead Ferenc Tarnok suggested she learn more about back-end systems. “Ultimately, I was the person responsible for Functions on Demand—like remote engine start, which you can buy even if the car wasn’t ordered with it—for all services provisioned for BMW vehicles in the US.”

Still more serendipitously, Capozzalo happened to be outside the Engineering building when she ran into Sam Campbell, Head of the Vehicle Safety Engineering and Intelligent Transportation Systems. “A position on his team was open, and I thought he would be a great mentor to work for. I didn’t know what half of the job description said, but he said he thought I’d be great at it, and so I gave it a try.”

In January 2024, Capozzalo took up her current position as Senior Engineer, Vehicle Regulatory Standards. “Basically, my job is to monitor non-safety and non-emissions regulations and ensure BMW is complying with them,” she said. “When I first took the position, you just had to watch the federal register, but the current administration has decided to be more hands-off with regulations and laws. You either have one federal regulation that is applied to 50 states, or you have 50 states making regulations. My biggest topic is chemicals, which is everything from the fluids that go into our cars to PFAS, the ‘forever chemicals,’ which are added to products that are water- or heat-resistant, like gaskets and hoses, convertible tops, carpeting, and upholstery.”

That’s a far cry from answering phones and filing invoices, but it’s not atypical for BMW NA associates who display talent and drive. “I've been fortunate to work with people who would allow me to learn if I showed interest in something,” Capozallo said. “So many of my managers have been very supportive, very nurturing, and very caring. That’s the greatest thing for me in a manager, to say, ‘Hey would you be interested in learning a different aspect of this?’ Any chance I can, I’ll look to learn.”

Erin Walter, Team Manager, Lease Loyalty, Used Vehicle Business, BMW Financial Services

When we think of BMW of North America, we usually think of the headquarters in Woodcliff Lake, but an equally important branch of the business can be found in Columbus, Ohio, home of BMW Financial Services. BMW Financial Services is vital to the company’s success, not least because it’s the division with which nearly all of BMW’s customers interact on a personal basis. When customers call in to discuss their loans or leases, they might end up speaking with Erin Walter, Lease Loyalty Team Manager for the South/Central Region.

Walter started her career as a Customer Service Advocate in January 2015. “I actually started as a temporary associate in our inbound customer service call center,” Walter says. “I got my degree in English literature with a specialty in Native American poetry, and I think it helped make me better with written communications and reading comprehension.”

Walter was already a BMW fan when she joined Financial Services, and drawn to the company on the strength of the brand. “Some startups might not be there in five or ten years, but I knew BMW would be,” she said, “and shortly after I got hired by BMW directly in August 2015, we had an i3 test drive. It was just so cool to be able to experience the vehicles.”

After two years in customer service, Walter became a Refinance Specialist. “We would field calls and help people restructure their lease or loan accounts,” she said. “In 2018, when we made a decision to outsource our refinance process, I stayed on the team to help them get off the ground as far as funding their deals and submitting credit applications through our system. I had to learn a lot about system integration and our internal processes surrounding funding and credit.”

That experience propelled Walter into a new post as Team Leader in Customer Service. “I started in February 2020, just in time for COVID to hit,” she said. “I had to learn that role from home, which was super-challenging as a first-time supervisor, and my first couple of weeks were spent ordering the call center laptops and getting everyone set up to work from home. It was definitely a trial by fire!”

In 2023, she moved to her current position as Lease Loyalty Team Manager. “I really love this position, and getting to branch out and work more with our dealers and sales and marketing managers. My primary role is call center management, monitoring my associates and helping with any questions they might have,” Walter said. “I’m also engaged with project work on EV readiness, since we’ll have about a 95% increase in EVs coming off lease next year. I’m researching a possible discount for EVs coming off-lease, and a lot of my time is spent working with Legal and Compliance, as well as with the marketing group. It’s all very collaborative, and my current boss Megan Sullivan is really great at guiding these kinds of projects. She’s on a different level than anybody I’ve ever met.”

In addition to Sullivan, Walter said she’s gotten effective mentorship from Alicia Reinhart in the refinance department. “She gave me the tools and empowered me to take the path to leadership.” Walter also cites Lisa McKinnon for “helping me understand how to look at numbers and measure things across a call center, while showing that you can be empathetic and understanding and also expect high-performing results from your team.”

Walter notes that all of her managers have been women. “I just love that there’s such a strong female leadership team, which has helped me become a better leader.”

After ten years with BMW Financial Services, Walter remains enthusiastic about the work, and eager to continue learning new skills and technologies. “I really appreciate BMW’s commitment to bettering the company technologically, to remain a competitive service provider in our space,” she said.

As for her own future with BMW Financial Services, Walter said she’s in for the long haul. “I’m so proud to work here, and I just love it,” she said. “I’ve drunk the Kool-Aid, and I couldn’t imagine working anywhere else.”

Ali Abubakar, Market Research Analyst, Product Management

Ali Abubakar has only been with BMW of North America for three years, but he’s already rising through the ranks as a business analyst. “I started as an intern in my senior year at Rutgers, where I did a BS in business and finance,” he said. “I was working in the Warranty Department and doing a whole bunch of projects on warranty reporting.”

Before taking the internship with BMW NA, Abubakar held part-time jobs at Autozone and a Toyota dealership, and he interned with a private equity firm in Manhattan during the summer before his senior year. “I think everyone needs a job they don’t like to make them appreciate a job they do like,” he said. “I can’t say I like private equity as much as I like BMW. I had four BMWs while I was in college, and I have a huge love for the brand.”

After graduating in May 2023, Abubakar joined BMW NA as a Business Analyst. “I was responsible for a lot of the sales reporting within the Eastern Region,” he said. “I was the data nerd, and my day consisted of living within Excel. I would send out daily sales reports to see how the region is doing, how we’re maintaining the daily pace. Another big part was market share, seeing how we’re doing versus our core four competitors.”

Being so fresh out of school allowed Abubakar to apply new technologies to the task. “No one used ChatGPT here before me, and I use ChatGPT for everything,” he said. “There were a lot of things in Excel that I didn’t know how to do when I started—I may have exaggerated my way into this role!—but I didn’t let that stop me from performing all the duties. I would ask ChatGPT how to use the formulas in Excel, and to do a lot of other things within Excel that I didn’t even know existed until I needed them.”

Even though his older colleagues had the initial edge when it came to Excel, Abubakar said they welcomed his use of ChatGPT “especially when they saw that response times and turnaround were significantly down compared to what they used to be, though a big part of that was because we moved from Cognos [software] to Tableau. I am a lot more familiar with Tableau, and every time I have an improvement or suggestion I would reach out to the Tableau developers or to the people in National Sales Department who are responsible for these dashboards to make improvements.”

As that suggests, Abubakar focuses on the IT side of BMW’s business, which served him well at BMW NA’s most recent dealer meetings. “Being the analyst at those meetings is difficult, frankly, because you have every C-suite executive, including the CEO, asking if you can pull up their deck, make changes, go through it with them again, or provide information,” he said. “The meeting lasts four days, and for the first three days we’re finalizing the presentation and putting everything together. Quite frankly, I’m really glad I got through it, especially last year when I was the only analyst to go to the meeting and had to put the deck together by myself.”

In October, Abubakar’s ability to handle that pressure helped him earn a promotion to a new post as Market Research Analyst, Product Management. “Essentially, I’ll be responsible for conducting market studies, and I’ll have access to a customer database where I can send out surveys on any topic,” he said. “For example, I could ask what people think of the cupholders in a BMW, or the sunroof that doesn’t open in the X3. And when I get the results back, I perform the analysis.”

This time, he’ll be analyzing that data not through Excel but with Python and Sequel, adding to his repertoire of software expertise. “I’m pretty excited for that, since I’ve only used Python and Sequel in school, not in a work setting,” he said, “and the information will help determine what actually ends up in our cars based on customer preference.”

While working at BMW NA, Abubakar is simultaneously pursuing a Master of Science in Business Analytics at Cornell, which will come in handy as he works his way up the ladder. “I always hear about people who’ve worked here for 30, 40, or 50 years—longer than I’ve been alive, quite frankly—and it’s clearly a good place to stay if this many people have been around for that long,” he said. “I’m really excited for my new job, and I would love to stay with BMW for the rest of my career if possible.”

Since its founding in 1975, BMW of North America has occupied a number of buildings in northern New Jersey, which themselves offer a fascinating glimpse at the company’s adaptations to increasing sales as well as new models of working in the post-pandemic era.

Upon its founding in 1975, BMW of North America inherited its headquarters building in Montvale from Hoffman Motors Corporation. Though it was strikingly designed by Rotwein + Blake, the building was intended to house a relatively small distributorship importing some 13,000 cars per year—not an important branch of a global automaker with 370 employees and sales of 100,000 cars per year, as BMW NA had become a decade later.

An expansion was required, and in 1986 BMW of North America CEO Dr. Günther Kramer commissioned a 205,000 square foot corporate headquarters for the rapidly expanding sales subsidiary. Designed by Princeton architectural firm CUH2A, the ultra-modern headquarters building was completed in 1988. Located at 300 Chestnut Ridge Road in Woodcliff Lake, it was large enough to accommodate BMW NA’s executive staff as well as those working for the motorcycle division, previously consigned to the old Butler & Smith offices in Norwood, New Jersey. It couldn’t accommodate the Eastern Region, however, so that division moved from an auxiliary building into the main Hoffman Motors building in Montvale.

As spacious as it was, the building was outgrown within two decades. Over that period, BMW’s U.S. sales had tripled to more than 300,000 cars per year, and its staff had grown accordingly. Once again, BMW of North America needed more office space.

Fortunately, Kramer had done more than simply commission a new headquarters in 1986. He’d also purchased a 40-acre plot of land, to which an additional 45 acres directly south of that parcel were added by then-CEO Tom Purves in 2004.

The latter plot included a 130,000-square foot office building at 200 Chestnut Ridge Road, which had been erected in 1971 as the headquarters of tool and equipment maker Ingersoll-Rand. Unlike BMW of North America, Ingersoll-Rand was contracting its New Jersey operations, and it no longer needed space for 700 employees in Woodcliff Lake. Following the sale, Ingersoll-Rand leased the building from BMW before relocating to a smaller building nearby.

In 2005, the Chairman and CEO of BMW (U.S.) Holding Company Tom Purves announced that BMW NA would be adding 220,000 square feet of new facilities on the site. As part of an overall reorganization of BMW NA’s facilities, the Ingersoll-Rand building would be upgraded for improved energy efficiency, then used to house the Aftersales division and BMW Motorrad among other business units. The old Hoffman Motors building in Montvale would be sold.

The $100 million facility announced by Purves would mainly be a Technical Training Center but would also house the Eastern Region offices. It was designed by New York architecture firm HOK, which had won an international competition with its proposal for an ultramodern glass-and steel structure. “We were seeking something that speaks to the BMW commitment to design elegance,” Purves told The New York Times in 2005. “We also wanted a building that would reflect our commitment to the natural environment and energy consumption reduction.”

HOK had employed innovative yet traditional methods to make the building more efficient. Windows and skylights would reduce the need for artificial light, wind would provide natural ventilation, and a set of exterior louvers would open and close automatically to regulate temperature. Radiant heat would be provided by hot water running through pipes in the floor. 

Equally important, the building was designed to blend into the landscape, even though its modern design would seem at odds with that goal. "We have selected glass and metal and crisp natural products to create a structure that will nestle into the elegant natural landscape and integrate itself into the surrounding orchards,” HOK’s Director of Design Kenneth H. Drucker told The New York Times. The building would be surrounded by bioswales, small wetlands that would treat runoff from the buildings and their parking lots in an environmentally-friendly manner.

Three years later, the building at 250 Chestnut Ridge Road was completed, along with new engineering workshops and vehicle storage facilities at 150 Chestnut Ridge Road. With the renovated Ingersoll-Rand headquarters, the three buildings constituted the newly-christened South Campus. 

At the opening in 2008, Purves noted that the new buildings “represent BMW's long-term commitment to America, to New Jersey and the region from where we draw our talented work force. They are part of BMW’s growing footprint in the U.S., a demonstration of our increasing commitment to and presence in this great country.” Indeed, BMW NA now had enough space for 1,000 employees in Woodcliff Lake, more than double the number employed by the company 30 years earlier.

In the meantime, the closed-office arrangement within BMW NA’s 1988 headquarters building (the 300 Building) had fallen out of fashion. In August 2011, the company announced that Jarmel Kizel Architects and Engineers had been hired to reconfigure the existing space with “open plan” architecture using a post-and-beam system rather than traditional wall panels. This would save space and allow the workspaces to be customized, should needs and uses change in the future.

Which they did, sparked by the work-from-home era that began in 2020 with the Covid pandemic. After an initial period during which all employees worked from home, BMW NA began requiring employees to return to the office for two days per week. The requirement has since increased to three days per week, but it still means that no more than 60 percent of employees are in the office at any given time.

At the same time that fewer associates were in the office at any one time, it was discovered that both the much-loved 300 building and its adjacent parking garage would need major structural repairs. This prompted management to rethink the BMW NA campus in its entirety.

The Ingersoll-Rand building would be renovated a second time to become the new BMW NA headquarters while the 300 building and the land to the north end of the campus would be severed and sold to a developer. On December 13, 2024, associates vacated the building at 300 Chestnut Ridge Road that had served as the headquarters for BMW NA for over 36 years and moved into the new headquarters at 200 Chestnut Ridge Road—now designated as 200 BMW Drive.

For its part, the former Ingersoll-Rand building at number 200 has been remodeled to make the most of its 1970s Brutalist architecture. As a BMW of North America press release stated at the building’s grand opening in April 2025, “The raw beauty of the exposed concrete structure is complemented by dynamic feature elements: energy-efficient angled LED lighting, saturated graphics, dimensional wood elements, and jewel-tone accents. The careful planning of both individual and collaborative workspaces allows daylight to flow across the floor. Higher ceilings and exposed structures successfully balance light. Collectively, these design decisions create a healthy and comfortable atmosphere that encourages focus, collaboration, and success.”

The renovation also made room for more than 25 pieces of artworks, which are now on display throughout the building. The art, previously hidden in various conference rooms and storage spaces, includes works by notable artists including Guatemalan-born abstract painter Alfred Jensen—whose “grids of brightly geometric patterns and forms” are part of the permanent collections of the Museum of Modern Art and the Guggenheim—and American figurative artist Alex Katz.

Most notably, the building now greets employees and guests with a “two-story entry pavilion that provides a monumental sense of arrival through its dramatic structural-glazed façade that extends toward a welcoming and vibrant communal green.”

Beyond the lobby, the interior was reconfigured along the lines of a co-working space, with a “centralized circulation path known as ‘Main Street’ which encourages employee interaction within the building and links directly to a modern full-service cafeteria and food service amenities.” With few exceptions, individual offices were eliminated in favor of work stations and lockers, with abundant common areas for meetings and informal interaction. All of that was made possible by software like Microsoft Teams, which enable internet-based communication and facilitates collaboration not only with BMW NA employees working remotely but with BMW AG in Munich.

“An ideal on-site work environment enables intensive collaboration,” said Ilka Horstmeier, BMW AG Member of the Board of Management, People and Places. “With the new BMW North America headquarters, we foster cohesion, innovation power, and ultimately growth and success. However, it's not just about where we work, but more importantly, how we work. It's about adopting more agile ways of working, using digital tools and methods, and thereby driving our performance.”

Having reimagined its campus, BMW of North America’s U.S. headquarters now consists of a central headquarters building housing the national sales company plus its associated functions including BMW Financial Services management, a second building housing the company’s North American training facilities and Eastern Region, and the third building for engineering, vehicle administration services, two vehicles workshops and a test vehicle storage area.  

The headquarters building commissioned by Dr. Gunther Kramer in 1988 will be sold, along with approximately 21 acres of BMW of North America’s 85-acre parcel in Woodcliff Lake. Though the company itself continues to expand, its office-space contraction represents the new reality of work in the post-pandemic era, one in which offices themselves can be whatever we need, wherever we are, and whenever we need them. 

 

On December 19, 2019, a hospital in Wuhan, China reported the first case of severe acute respiratory syndrome caused by a previously unknown coronavirus that would be identified shortly thereafter as COVID-19. The disease was unusually contagious, and unusually virulent, causing its first fatalities shortly after it was identified.

On January 20, 2020, the first case of COVID-19 was reported in the U.S. Three days later, the city of Wuhan put its 11 million residents under lockdown. The U.S. restricted travel from China, while public health officials urged the population to maintain “social distancing” in response to a shortage of protective masks and other equipment. Infections continued to spread, and the U.S. saw its first COVID-19 fatality on February 6.

The first death occurred in California, and that state would be particularly hard-hit by the outbreak along with densely populated New York City. By March, New York City was reporting 25 percent of all confirmed cases in the U.S., and infections in the New York metropolitan area had soared past half a million three months later.

On Friday, March 13, the U.S. declared a state of emergency. All but essential businesses were closed, joining most public schools, theaters, and restaurants. BMW of North America (BMW NA) sent its 3,000+ employees’ home from company headquarters in Woodcliff Lake, New Jersey, just 22 miles from Manhattan, as well as BMW Financial Services (BMW FS) in Ohio and other facilities nationwide.

Howard Harris, VP for Legal Affairs and General Counsel, as well as the Chair of the Crisis Management Committee (CMC), led the CMC and advised the Executive Boards of BMW NA and BMW FS in making the decision to close US BMW Group facilities across the country after Friday, March 13.  Harris also consulted with the US BMW Group’s South Carolina operations, which out of necessity, required a different set of considerations to be evaluated.  Harris’ role as CMC Chair had been instigated by former-President and CEO Tom Purves in anticipation of the avian flu epidemic of 2008. When swine flu arrived a year later, the CMC made sure the US BMW Group had a plan to keep its employees safe, as well as a supply of Tamiflu for those who became infected.

Both of those epidemics were contained swiftly, but COVID-19 had reached pandemic status on March 11, according to a declaration by the World Health Organization. Even prior to that date, Harris and the CMC —particularly a core group of representatives from legal, corporate communications, human resources, financial services, and security/facilities—were attempting to determine the appropriate course of action for the Company.

“On March 13, I was in Nazareth, Pennsylvania at our Regional Distribution Center, where I’d gone to see what we needed to consider in our operational units,” Harris said. “By that week, it became pretty clear that we needed to shut down. Our goal was to protect the health and safety of our associates, protect our business operations, and protect our assets, in that order, with the safety and health of our associates first.”

The CMC had almost a decade earlier led the process to have Business Continuity Plans put in place, which up to March 13 were mainly used for power outages and extreme weather events. Therefore, by 2020 associates already understood how to work remotely. This enabled the shutdown of operations to be more seamless than anyone could have expected.

Even so, the shutdown still came as a shock to those within the company, including President and CEO Bernhard Kuhnt.

“We’d just had our dealer meeting in Boca Raton, and within a few weeks the whole world collapsed,” Kuhnt said. “We departed the office on March 13, and I thought we’d be back in the office at the beginning of May or so. Little did we know that we’d have several months where no one was allowed to go into the Woodcliff Lake [headquarters] based on the local rules and regulations, and that a year later we still wouldn’t be at full capacity.”

Working from home kept associates safe, but it made performing some tasks challenging despite the Crisis Committee’s preparations. “Not everyone had a functioning laptop with all the capabilities you need,” Kuhnt said, “so we did a lot of hardware and software purchases to enable the company to be as good as possible, and to remain flexible under that environment.”

Most presciently, the U.S. BMW Group’s customer service call center in Ohio placed a large order for laptop computers just before supplies became constrained, making it possible for associates to provide uninterrupted customer service during the crucial period of spring 2020. That allowed BMW FS to adjust payment schedules in the event of job loss or other difficulties, and to extend vehicle warranties and maintenance plans while offering no-cost vehicle pickup and delivery when service was required. (Although what was “essential” and what was not was not always clear under federal, state, and local laws and regulations.  Ultimately, dealership service departments were deemed essential in many states and thus remained open with limited staffing and reduced customer interaction).

With the economy at a near-standstill and commuting curtailed, new-car sales plummeted nationwide. BMW of North America had started 2020 with an attractive lineup that included a number of new models, but the first quarter of 2020 saw sales slump by 15.3 percent compared to the same period in 2019. The second quarter of 2020 would be even worse, with sales falling by 39.3 percent compared to Q2 2019. 

Those numbers reflected COVID-19’s increasingly severe impact on public health, particularly in the Northeast. By the beginning of May, confirmed COVID deaths in New York City approached 20,000, overwhelming hospitals and morgues and forcing the city to store bodies in refrigerated trucks prior to burial. “Around 30 million people live in New York and New Jersey, but despite having less than half the population of Germany, the death rate was significantly higher in this area,” Kuhnt said. “It was a very severe situation, which authorized severe actions.”

Even so, BMW NA needed to ensure its survival as a business while protecting the health of its associates. That meant continuing to sell cars under both the BMW and MINI nameplates (Rolls-Royce Motor Cars NA as well). The latter was especially hard-hit by the pandemic thanks to its younger and more financially vulnerable customer base, with sales falling by 35.1 percent in Q1 of 2020 and by 41.5 percent in Q2. Those numbers forced the MINI Sales and Marketing team to adapt quickly, particularly after community-focused events like MINI Takes the States were canceled.

Where online retailing was concerned, the MINI leadership team—VP of MINI Americas Mike Peyton, Head of Sales and Aftersales Claude Bruni, and Head of Marketing and Product Patrick McKenna—realized early on that the brand was far behind the competition.

Since most off-the-shelf software was focused on generating leads rather than making sales, BMW Financial Services and MINI executives decided to work with FAIR to build their own platform. (Now defunct, FAIR was a FinTech vehicle subscription company in which BMW owned a small stake.) FAIR declared bankruptcy before the project could be completed, but co-founder Georg Bauer—who’d earlier spent seven years as CEO of BMW Financial Services worldwide—shepherded the project to a new company, Netsol. 

“We built a tool called MINI Anywhere that was beautiful, clean, and kind of audacious, because we were the smallest car company in the country and we had a bespoke digital retail solution which J.D. Power ranked as one of the best in the industry for four consecutive years,” McKenna said. 

MINI Anywhere allowed customers to complete the entire transaction online, from selecting a car to financing the sale. “What separated it from other tools is that it offered a real-time credit decision, contracting, and a digital signature that was completely validated by MINI Financial Services,” McKenna said. “Most digital solutions are just lead generators, but this allowed you to literally transact the car.”

MINI Anywhere facilitated the transaction, but the sale was still processed through the customer’s local MINI dealer. U.S. franchise laws required MINI Anywhere to comply with rules and regulations in all 50 states, which can vary widely. That 50-state dynamic played out for the e-commerce mechanisms adopted by BMW alongside MINI, and it mirrored the U.S. response to COVID-19, which varied dramatically throughout the country.

“The pandemic was a very complicated legal situation with all the federal guidelines and state executive orders and regulations that didn’t align,” Harris said. “Basically, you had 50 states with different approaches and different rules. We were doing daily updates of the rules in place in each state, which was purely legal, but the changes often were driven by new learnings, new procedures in the medical community, or with respect to Personal Protective Equipment (PPE). This also led to rapid changes in terms of shutting operations down or opening things up on a daily and weekly basis.”

States in close proximity to New York, including New Jersey, were especially restrictive, which matched BMW NA’s approach to the pandemic. “We were always trying to be on the cautious side in going back to work at BMW North America,” Kuhnt said. “We did everything we could do from masks to cleaning, to using Plexiglas to separate people, to comply with the regulations.”

In other regions of the country, the lack of restrictions allowed BMW NA to keep selling vehicles in a close to usual manner. “Everything was closed here in New Jersey or on the West Coast, but in some areas of the country, it was business as usual,” said Executive Vice President of Operations, Shaun Bugbee. “We really had to adapt our approach. Some of our sales managers were still visiting stores, while others were doing things remotely.”

In Spartanburg, South Carolina, BMW Manufacturing was subject to few restrictions from the state. When the plant shut down from March 29 through May 4, 2020, it did so in response to supply-chain issues as well as a drop in demand. Associates performed maintenance and repairs, and they set up new work processes that would increase social distancing and sanitation once the plant resumed operation, initially with one shift per day rather than two. “They took a lot of precautions,” Harris said. “And in an overly cautious move, the plant acquired a machine to make face masks. We had to figure out what grade they would be, and what were the laws and regulations for their classification before they could be used.”

Across the street, COVID-19’s interruption to the BMW Performance Center’s driving schools was even shorter. “We shut down for maybe three weeks [in Spartanburg],” said Daniel Gubitosa, head of operations for the Performance Center. “We got a lot of support from the plant to have the right PPE in place. We also instituted procedures, like wiping down the cars with disinfectant and restricting vehicles to a single driver rather than the normal two. “I couldn’t see just throwing in the towel. We had to find a way to keep going.”

With so few options for activities or entertainment, customers were eager to get behind the wheel. “They’d been stuck at home, and they couldn’t wait to get out! They were all frustrated!” Gubitosa said. “[At the Performance Center], people were relieved that they could do something and feel safe. You’re outside, relatively, you’re in a car by yourself, so people felt safe.”

The Performance Center’s West Coast operations in Thermal, California wouldn’t reopen until late fall 2020, but even in relatively restrictive New Jersey, BMW NA was able to stage an Ultimate Driving Experience at MetLife Stadium during the summer of 2020. “I and others on the CMC went down to check the precautions,” Harris said. “We tried to get the best information we could from our insurance company, from medical professionals, and we took in all the information that we had and used it to aid holding an event with proper precautions. Those learnings proved to be fruitful for future events.”

Although outdoor activities were deemed relatively safe, returning to the office remained problematic. Like every organization, BMW NA replaced in-person meetings with virtual meetings, using new technology to hold business meetings. “They were probably run better than in real life, because they were very matter of a fact,” Kuhnt said. “We missed the camaraderie, being together, but we tried to bridge that as well as possible given this completely new situation.”

That meant using the same technology for virtual happy hours, which helped the associates maintain camaraderie. “The ability to have visual calls was, frankly, I think critical to our success,” Harris said. “It kept people engaged, along with the ‘Making It Work’ series of video snippets.”

The Making It Work videos became part of BMW NA’s regular updates to its employees, a way of humanizing the company during a potentially alienating period. “Executives would film themselves at home, talking about what they were doing, how the business was running, what was happening, and how the teams were making it work around the country no matter where they were,” said Mariella Kapsaskis, Head of Corporate and Product Communications for BMW Region Americas and part of the core Crisis Team during the pandemic. “It was great. You’d see people with long hair, beards, children running in the background. It was all very real and unfiltered.”

BMW NA and BMW FS did indeed “make it work.” Thanks to a proactive sales strategy as well as effective online sales tools, sales hit a new record in September, leading to a much smaller year-to-year decline in Q3 2020: 16.2 percent for BMW, 11.9 percent for MINI compared to the same period in 2019.

“We had aggressive loyalty programs so that people who were coming to the end of their lease, and who we knew had to make a decision, would get called to action, as we say in the sales world,” said Shaun Bugbee, Vice President of Operations. “We would get the conversation going to say, for instance, ‘Your lease is going to end at the end of May. Your payment now is $589 a month, and we can get you in a brand-new X3 for $600 a month.”

At year’s end, BMW NA’s sales stood at 278,732 BMW and MINI vehicles, a 17.5 percent decline from 2019’s total of 338,003 vehicles. That was slightly higher than for the US auto industry overall, which saw a 14.5 percent decline in sales from 2019 to 2020. Much of that decline was caused by COVID-19 closures, the rest by supply-chain issues, including shortages of the computer chips used by the BMW Group’s electronics-intensive vehicles.

Interestingly, COVID affected not only how many vehicles BMW NA sold but the manner in which it sold them. With so many customers unable to visit dealerships, twice as many as usual opted to configure their vehicles individually rather than buying from dealer inventory. This allowed dealers to stock fewer vehicles and reduce their expenses accordingly, and in most cases, it didn’t entail a long wait for customers. “One of the beauties of our business here in the US is that about 63 percent of our volume is SUV, with the majority coming from Spartanburg,” Bugbee said. “A customer can order a vehicle at the beginning of the month and have it delivered by the end of the month.”

As parts shortages eased and vaccines against COVID became available in late December 2020, ‘Making It Work’ meant returning to the office—at least part-time. “People were working [from home] harder than they probably ever had, and for more hours of the day but during the course of 2020 we thought there needed to be an in-office presence at some point,” Harris said.  

BMW NA and BMW FS didn’t mandate vaccination for its employees, but company policies encouraged it, along with the use of masks and sanitation equipment when associates were required to return to Woodcliff Lake at least two days per week. “We were always trying to do the right thing, and if people were going to come back into the office, they needed to feel safe,” Harris said.

At the end of August 2021, BMW NA President and CEO Bernhard Kuhnt swapped jobs with Sebastian Mackensen, becoming Senior VP for BMW Group’s home market of Germany while Mackensen took over at Woodcliff Lake. A year and a half into the pandemic, the availability of vaccines had eased the rate of transmission as well as the severity of infections, but COVID remained an issue.    

“What was mainly difficult was international travel,” Mackensen said, “but we also had our ups and downs in Bergen County. We opened the office and had to close it down again, and then we had to decide to bring everyone back. And then we had to see: Do we need a mask mandate? Do you wear the mask when you walk into the building, and also when you sit at your desk? How many people should be in a certain size of room? We also had to manage fear, which for some people existed while others couldn’t care less. We tried to be transparent and considerate, but also to stay in business. It was a bit of a roller coaster.”

Those considerations saw remote work become normalized within BMW NA, with associates allowed to work from home two days per week. No more than 60 percent of associates are working at the Woodcliff Lake headquarters at any given time, and the building has been reconfigured in the manner of a co-working space, with most offices replaced by unassigned workstations, lockers, and common areas where associates can collaborate.

To date, COVID-19 has caused an estimated 1.2 million deaths in the United States alone, but to the best of their knowledge BMW NA and BMW FS recorded no fatalities from in-office transmissions and very few fatalities for out of office transmissions. “I think that’s the thing we’re most proud of,” Harris said. “Our peoples’ health and welfare were always put first, but we were cognizant that we needed to keep the business running and enable it to be successful.”

Indeed, BMW NA’s and BMW FS’ Business Continuity Plans helped the company mitigate the pandemic’s economic effects, which saw countless businesses in the U.S. close altogether, with the loss of some 40 million jobs and trillions of dollars. In 2021, BMW NA’s automobile sales recovered to almost pre-pandemic levels, with annual sales of 336,644 automobiles representing just 1,359 fewer than the total for 2019. In 2023, BMW NA posted record sales of 362,244 automobiles in 2023, then set another new record by selling 371,346 automobiles in 2024.

“There was no rule book, and we’d never gone through a pandemic before,” Harris said. “But I would judge our response by the results, by the health and safety of our employees and also how well the business did at the time. I would venture to say that we probably handled it better than most companies in the United States.”

- Check against delivery –

Ladies and Gentlemen,

Good Morning.

In the third quarter of 2025, the BMW Group continued its strategic course and maintained its global market position.

But before we dive into the details of the quarter, I would like to directly address our communication from October 7th.

You all know the BMW Group as an ambitious company.

We have always focused on identifying opportunities and realizing market potential, and our success demonstrates that this is the right approach.

In 2025, despite all known challenges, we were confident in the fundamental potential of the Chinese market.

Our planning scenario was fully confirmed during the first six months, with a performance on the level of the second half of 2024.

For the second half of this year, we assumed we would see growth momentum.

However, at the beginning of the fourth quarter we observed that this momentum had not materialized to date.

So, for the remainder of 2025, volume stabilization, rather than volume growth, now appears likely. Accordingly, we have adjusted our planning and now anticipate a consistent monthly run rate in China in line with the first half of 2025.

In addition, we have introduced measures to support the profitability and liquidity of our dealers in China.

These measures will also have an impact on our Q4 profitability.

The consolidation of our dealer network in China is progressing to plan.

Ladies and Gentlemen,

With respect to tariffs, the BMW Group has been fully transparent throughout the year concerning the impact on our 2025 financial results.

Our original guidance given in March as well as our updated assessments in the Q1 and Q2 reporting were based on certain assumptions.

As mentioned in our ad-hoc announcement, these assumptions were not fully realized as expected to date.

We now anticipate a tariff-related headwind of 1.5 percentage points on the Auto EBIT margin for the full year.

I will share further details on our full-year outlook later on.

But now, let me walk you through our Q3 figures.

Group earnings before tax totaled over 2.3 billion euros in the third quarter and exceeded 8 billion euros year-to-date through September.

Compared to the first nine months of 2024, this represents only a slight decrease of 9.1 percent – a notable achievement in light of the current developments in the Automotive industry.

And for the full year, we also expect a decrease in the single-digit range only.

This represents a full-year Group profit before tax of approximately 10 billion euros – despite the significant burden of higher tariffs.

Excluding the impact of tariffs, pre-tax profit even exceeds the 2024 figure.

Within the BMW Group ecosystem, every segment contributes to our overall success.

The reported Group EBT margin stood at 7.2 percent in the third quarter and 8.1 percent year-to-date through September.

The reported Auto EBIT margin fell within our full-year target corridor for both Q3, at 5.2 percent, and year-to-date through September, at 5.9 percent.

Ladies and Gentlemen,

As you know, the BMW Group is always transparent in its reporting, and we consistently focus on communicating our published figures.

For better comparability within the industry, allow me, nevertheless, to provide a few additional details regarding our operational performance in the Automotive segment.

First: Auto EBIT includes the depreciation resulting from the purchase price allocation of BBA.

Excluding this depreciation, which amounts to approximately 1.1 percentage points, the quarterly margin would be 6.3 percent, and the nine-month margin would be 7.0 percent.

Second: Auto EBIT also includes the burden of extra tariffs, which amounts to around 1.75 percentage points in the third quarter and 1.5 percentage points through September.

This impact should also be added for a fair comparison of our EBIT margin.

Q3 deliveries to customers at Group level increased solidly by 8.7 percent year-on-year.

After nine months, the share of all-electric vehicles reached 18 percent of total sales.

And with a share of 26.2 percent, more than one in four vehicles sold globally was electrified, meaning either a BEV or a plug-in hybrid.

Let’s now take a look at how the Automotive Segment performed across key metrics.

Deliveries of BMW, MINI and Rolls-Royce vehicles to customers reached 588,140 units in the third quarter.

In Europe, sales grew by 9.3 percent, and in the US by 24.9 percent.

In China, retail sales did not meet our expectations, with deliveries at previous year’s level.

After nine months, global retail sales approached 1.8 million units, representing a slight increase of 2.4 percent.

This clearly demonstrates the strength of our global business model, with sales performance in Europe and the US more than compensating the challenges in China.

Sales of all-electric vehicles exceeded 100,000 units for the sixth consecutive quarter.

Q3 revenues in the Automotive segment amounted to 28.5 billion euros, reflecting a slight increase of 2.4 percent year-on-year. Adjusted for currency translation effects, the increase was 6.4 percent.

Segment EBIT amounted to approximately 1.5 billion euros in Q3 and 5.1 billion euros from January to September.

The reported EBIT margin – including the negative impact of BBA PPA and tariffs – came in at 5.2 percent for the quarter and 5.9 percent as of September.

That brings me to my next slide, taking a detailed look at our operating result of the third quarter year-on-year.

Automotive EBIT increased by around 900 million euros compared to Q3 2024.

As anticipated at mid-year, changes in currencies negatively impacted EBIT by 500 million euros, while raw material positions remained neutral.

The net effect of volume, model mix and pricing resulted in a negative impact of 300 million euros in the third quarter, compared to the previous year.

Both volume and model mix provided a tailwind, while pricing was a headwind.

This is particularly evident in China, where we see price pressure across all segments.

Furthermore, since the end of June, Chinese banks have significantly reduced dealer commissions.

While this led to a certain increase in transaction prices, as expected, it could not offset the negative impact of the lower commission revenues for dealerships.

Consequently, we implemented dealer support measures in Q3 to strengthen dealer profitability and liquidity.

Ladies and Gentlemen,

In line with our planning, we will continue to decrease our operating costs in 2025 and beyond.

This trend is once again reflected in our figures for the third quarter.

Research and development expenses decreased by about 300 million euros compared to the prior-year quarter.

Group R&D expenditure totaled 5.9 billion euros as of September. This remains significantly below last year's level, despite extensive product initiatives and intensive preparations for the first models of the NEUE KLASSE.

The R&D ratio according to the German Commercial Code stood at 5.9 percent after nine months.

Selling and administrative expenses decreased by around 200 million euros compared to the previous year.

These nominal cost savings of 500 million euros more than offset the negative impact from volume, model mix and pricing.

Other Cost Changes provided a tailwind of around 1.2 billion euros compared to the third quarter of 2024.

This development results mainly from three areas:

On the one hand, warranty expenses were significantly lower year-on-year.

In Q3 2024, we fully recognized the necessary warranty provisions for the Integrated Braking System.

On the other hand, tariffs had a negative impact of around 1.75 percentage points on the Auto EBIT margin in Q3.

The majority of the improvement in other cost changes in Q3 results from the positive development of manufacturing costs and material costs.

Overall, we reduced costs by over 1 billion euros in the third quarter and by approximately 2 billion euros year-to-date through September.

In addition to EBIT, tariffs also affect free cashflow.

While refunds are recognized in EBIT, cash will rather be recognized in 2026 than in 2025.

This negatively affected free cashflow through September, and the timing effect alone will impact free cashflow for the full-year by a high three-digit million euros amount.

Free cash flow in the Automotive Segment totaled 343 million euros in the third quarter.

Earnings before tax amounted to 1.4 billion euros.

The net change in working capital contributed positively to free cashflow by around 300 million euros.

The negative net effect of capital expenditure and depreciation impacted the third quarter by 300 million euros.

The capex ratio was 5.2 percent in the third quarter and 4.4 percent for the first nine months.

Following the peak in 2024, capex will decrease for the full year 2025. The capex ratio is projected to remain below 6 percent.

Changes to provisions negatively impacted free cash flow in the third quarter by approximately 400 million euros.

This was primarily due to the consumption of warranty provisions.

The change in the position Other, amounting to around 600 million euros, includes income taxes paid.

After nine months, free cash flow in the Automotive segment stands at almost 2.7 billion euros.

For the full year, we now target a free cash flow of over 2.5 billion euros, compared to the original forecast of over 5 billion euros.

This is driven by two factors:

Lower-than-expected earnings for the full year

And tariff refunds that we expect to receive in 2026 instead of 2025

We remain committed to shareholder returns using both dividends and share buyback.

Despite the lower free cashflow outlook, we will maintain our dividend payout ratio of 30 to 40 percent and will continue our share buyback program as announced.

As a result, the anticipated shareholder returns for the financial year 2025 will exceed free cashflow.

Let’s now turn to our Financial Services segment.

Financial Services is a key component of our customer journey and an important part of our integrated value chain.

As a vital element of our financial operating model, the segment contributes consistently to our Group profit.

New business grew significantly during the third quarter, primarily driven by the changed competitive environment in China.

This contributed to a slight year-on-year increase of 1.9 percent in new leasing and financing contracts concluded with retail customers over the nine-months-period.

New business volume increased by 4.2 percent to 48.5 billion euros.

The penetration rate for lease and loan offerings rose by 4.1 percentage points to 46.4 percent.

Segment earnings amounted to more than 1.8 billion euros, a year-on-year decrease of 14.4 percent.

The decline is primarily attributable to the lower income from the resale of end-of-lease vehicles as well as a tax payment in the second quarter resulting from a revised operational tax assessment for prior years.

Resale income remains positive on a portfolio basis.

The credit loss ratio across the entire loan portfolio remained low at 0.26 percent.

In the Motorcycles Segment, deliveries increased solidly by 5.7 percent year-on-year.

EBIT for the second quarter totaled 60 million euros, resulting in an EBIT margin of 7.9 percent.

Let’s now turn to our outlook for the 2025 financial year.

Four weeks ago, we confirmed that the Auto EBIT margin will remain in the guided corridor of 5 to 7 percent – more specifically in the range of 5 to 6 percent.

We also confirmed that deliveries in the Automotive segment are expected to increase slightly.

At the same time, the BMW Group adjusted its guidance for the following two key performance indicators:

Group Profit before Tax, which we now anticipate to decrease slightly compared to 2024

Return on Capital Employed (RoCE) in the Automotive segment, which is now expected in a corridor between 8 and 10 percent

In the Motorcycles segment, deliveries are now expected to decrease slightly, whilst the EBIT margin range is confirmed between 5.5 and 7.5 percent.

In the Financial Services segment, we confirm a Return on Equity (RoE) in the range of 13 to 16 percent.

Ladies and Gentlemen,

We have invested early and significantly in the future of our company, in line with our long-term strategy.

Our technology clusters are ready – paving the way for the broad deployment of innovations across our complete product portfolio.

Our Gen6 battery technology will shortly hit the market and support profitability with cost savings of 40 to 50 percent for the battery pack.

After reaching their peak levels in 2024, we are reducing both capex and R&D, as planned.

We are also maintaining our consistent management of operational costs. This is reflected in our figures for the third quarter and through September, and it will continue to be visible going forward.

With our highly attractive products and the NEUE KLASSE, we have the right levers in place to continuously strengthen our global market position, today and in the future.

We believe that our 2025 profitability stands out in the current business environment, with a pre-tax profit decline only in the single-digit percentage range year-on-year.

And with our strong balance sheet as a solid foundation, we will deliver consistent returns for our stakeholders.

Thank you.

- Check against delivery –

Ladies and Gentlemen,

Good morning.

For the BMW Group, several key strengths have long formed the foundation of our strategic course: our global footprint, our technology-neutral approach, our premium multi-brand strategy and broad portfolio across all relevant customer segments, and our ability to identify the potential of new technologies and bring them to road in each major region. These strengths give us flexibility and make us resilient, and we are benefiting from them now.

As a global company with global brands, we are used to dealing with varied conditions and unpredictability on the ground in each market.

We recognize the current dynamics in the automotive industry: major transitions in innovation, operating with a global supply chain, a shifting geopolitical framework with trade impacts such as tariffs, as well as a rapidly evolving market in China – to name but a few.

We remain focused on our long-term trajectory, while using our flexibility to adapt to the changing dynamics and are tackling them head on. This is what has always set the BMW Group apart.

Our business remains on track and healthy. As Walter just shared, this is underscored by our Group EBT result over the first nine months – demonstrating the performance of the entire business including our sales development.

Despite the challenging market dynamics in China, our overall global sales posted year-on-year growth of 8.7% in the third quarter; excluding China, it was 12.2%. Through September, sales in Europe were up 8.6% compared to 2024, while sales in the United States grew by 9.5%. These strong results helped compensate for the development in China.

Electrified vehicles and M vehicles both drove global growth. With our technology-open approach and multiple premium brands, customers find products that fit their wide range of needs and tastes.

In the coming months, we will take this to the next level with the introduction of the NEUE KLASSE. Just two months ago at the IAA Mobility here in Munich, we unveiled the BMW iX3*, the first vehicle of our NEUE KLASSE. The response was tremendous – from visitors and fans from across the globe, media, analysts, and political stakeholders. A few weeks later we celebrated the official opening of our new plant in Debrecen, where production of the iX3 is underway.

We have started taking customer orders for the car, which have exceeded our expectations. Just looking at Europe, we see orders already extend several months into 2026 already. This confirms an exceptionally positive start for the vehicle.

The NEUE KLASSE is BMW at its best. And starting with the iX3, it will set new benchmarks: from its performance data and revolutionary digital interface to its sustainability approach.

The BMW iX3 offers a range of more than 800 kilometers in the WLTP cycle. Thanks to its ultra-fast charging capability, the peak charging power is up to 400 kilowatts. That means: in just 10 minutes, the iX3 can charge enough to drive more than 370 kilometers.

The fully immersive digital experience will bring UI / UX to a whole new level. With the BMW Panoramic iDrive, drivers can intuitively keep their eyes on the road while all necessary information is perfectly in view.

With the BMW iX3, we will also introduce a new generation of driver assistance systems. The BMW Group is the first car manufacturer in Germany to receive approval for assistance systems in accordance with UN Regulation for Driver Control Assistance Systems (DCAS).

The approval enables the BMW Group to offer the Motorway Assistant with Level 2 “hands-off” function in numerous other models and countries in the future. This also covers an extended range of functions. More innovative assistance functions for urban driving will follow.

In terms of sustainability, the iX3 is explicitly focused on conserving resources and reducing the model’s environmental footprint – throughout the supply chain, production, use phase and recycling. In line with the principles of design for circularity, the iX3 is made up of one-third secondary raw materials.

Moreover, Plant Debrecen is the first BMW Group car factory that operates and produces vehicles without using fossil fuels, such as oil and gas, under normal operating conditions.

Overall, the iX3 is a perfect example of our strategy of reducing CO₂ wherever we have leverage. This will help us reach our near-term target to reduce our carbon footprint by at least 40 million tonnes CO₂ by 2030. Since 2020, we have been fully committed to the Paris Climate Agreement, with a target of achieving net zero by 2050.

The next NEUE KLASSE model, which we teased at the IAA, is preparing for launch: the new BMW i3. With the eighth generation of the 3 Series, we will bring the NEUE KLASSE and its technology clusters into the core of the BMW brand. Production of the i3 will get underway at our main plant in Munich in the second half of next year. Other locations in our international production network will follow with production of 3 Series variants.

Throughout 2026, we will show how the NEUE KLASSE technologies will be integrated into further models, such as the 7 Series and the X5. By 2027, we will put 40 new models and model updates with NEUE KLASSE technology and design language on the road worldwide.

This all-new BMW generation will provide an enormous boost to our already broad and popular portfolio – with technology solutions tailored to customers in their markets.

This applies especially to China. The NEUE KLASSE products we will launch in China are developed together with our local engineering teams and Chinese partners – in the market, for the market. Our NEUE KLASSE architecture allows to integrate local tech stacks from leading Chinese tech players into our own ecosystem. This gives consumers access to innovations and features they are used to, including solutions from Alibaba Banma, DeepSeek, and Momenta.

With the NEUE KLASSE, we are again demonstrating our strength in mastering system complexity, integration and efficiency. We know what our customers want and identify trends in individual markets early. The result are products that perfectly integrate the best technologies – both in house and with partners – across regions to offer the best product substance to our customers.

What makes the NEUE KLASSE so unique, is that we are rolling out the technology clusters across the entire portfolio – regardless of the drivetrain.

Our technology-neutral approach continues to show its success and allows broad market access as consumer preferences shift. At the same time, we are making progress in decarbonization in the here and now. After nine months into 2025, Group sales of all-electric vehicles are up by 10%, resulting in a BEV share of 18%. PHEVs grew nearly 28% year-on-year, delivering an overall electrified share through September of 26.2% globally.

Europe showed particularly strong growth – with BEVs reaching over a quarter of total sales, while BEV and PHEV sales combined for an impressive 41% share. Europe will also be the primary driver of our BMW iX3 sales in 2026.

Thanks to this solid result, we are well on course to reach our CO₂ fleet target for the year, just as we have consistently done for the past several years. For us, it has long been clear that we would meet the targets for 2025 – and, importantly, without penalties, pooling, or averaging.

This success with our technology-neutral strategy also gives our voice weight in the ongoing discussion regarding the EU’s targets.

We have reached our climate targets by following market demand and customer needs and by continually optimizing all drivetrain variants.

It remains critical for Europe to revisit the targets for 2030 and 2035.

Setting an end date to a specific, successful technology will lead to a massive shrinking of the industry as a whole. It will harm European industry and also create dependencies that are unwise in the current geopolitical dynamic.

To achieve climate goals and create effective CO₂ regulations, we must take a comprehensive view – one that accounts for the full carbon footprint of the vehicle and its value chain, and that also values climate-neutral fuels such as HVO100. Such a holistic framework would reflect various market needs and uneven infrastructure development, while safeguarding Europe’s value chains, jobs, and industrial strengths. And – above all – it delivers genuine climate protection and real reductions in CO₂.

Companies should be free to deliver the solutions, taking customer demands and needs into account, while adequately investing in new paths and technologies to achieve the EU’s climate goals.

In this context, the BMW Group is very skeptical about the EU’s planned “Greening the Fleets” regulation, as it does not consider current market realities. Commercial fleets rely on high vehicle availability with high mileages. The currently inadequate charging and hydrogen refueling infrastructure will not be guaranteed in all member states by 2030 either. Further fleet mandates and additional regulations that exclude individual technologies are not necessary to achieve the CO₂ targets. Moreover, they hinder technological development and introduce harmful market distortions contrary to customer preferences. Here also, we advocate for a holistic and technology-neutral approach.

Ladies and Gentlemen,

We are tackling the challenges in global markets head on, leveraging our strengths and implementing our long-term strategy. We have made significant investments and have created the right operating framework to deliver. Our flexible, global network, our tech-open strategy, our focus on innovation and our ability to master technological complexity set us apart.

Over the coming months, we will deliver as promised. Starting with the iX3, we will rapidly deploy our ambitious strategy one vehicle at a time around the globe. We will continue to lead with product substance and solutions that meet our customers’ needs.

We therefore remain optimistic as we close out 2025 and move forward to 2026.

Thank you.

Munich. The BMW Group’s performance in the year to date has been characterised by robust global sales development, disciplined cost management and a consistent strategic framework.

The Automotive Segment EBIT margin remained within the full-year target range for both the first nine months and the third quarter – despite continuing geopolitical challenges and intensifying competition. Customer deliveries rose slightly year-to-to date at the end of September, while free cash flow in the Automotive Segment stood at € 2,688 million after nine months. On Wednesday, based on these results, the Munich premium manufacturer confirmed its adjusted financial full-year targets announced in October.

“In the third quarter, we once again proved that our business model is robust and resilient”, said Oliver Zipse, Chairman of the Board of Management of BMW AG. “We have all the right factors for continued success: a technology-neutral approach, exciting products, a strong global presence and outstanding innovation capabilities throughout the entire value chain. Thanks to our broad model and drive train portfolio, we were able to increase our global sales – with BMW M and our electrified vehicles as the main growth drivers. At the same time, we remain fully on track to meet Europe's ambitious CO₂ targets for 2025 – without relying on flexibility mechanisms or pooling. This demonstrates that our technology-neutral approach is working and delivering strong results.”

Growth in electrified vehicles and M models 

Year-on-year, the BMW Group achieved a slight +2.4% increase in deliveries, reaching a total of 1,795,734 vehicles in the YTD September (2024: 1,754,157vehicles). In the third quarter, the premium manufacturer delivered 588,140 BMW, MINI and Rolls-Royce vehicles to customers (2024: 540,881 vehicles/+8.7%).

The success of the BMW Group's technology-neutral strategy was particularly evident at both ends of the drive train line-up: In the first nine months, the strongest growth came from BMW M models (+7.9%) and from electrified vehicles (+15%). In the year to the end of September, electrified models accounted for 26.2% of total sales (2024: 23.3%), with BEVs representing 18.0% (2024: 16.8%).

In Europe, electrified vehicles gained even higher shares: they made up no less than 40.9% (301,947 units) of all sales while fully-electric vehicles comprised a quarter during the same period (189,269 units; 25,5%).

The BMW Group expects further positive growth momentum in 2026 from the all-new BMW iX3*, the first model of the Neue Klasse.

“The response to the BMW iX3 has been extremely positive: In Europe, new orders significantly exceed our expectations, confirming the strong customer interest,” said CEO Zipse. “With the Neue Klasse, we are making a major leap forward – in technology, driving experience and design. Our entire product line-up will benefit from these innovations within a short timeframe: Between now and 2027, we will bring 40 new and updated models to market – across all segments and drive train variants. Next year, we will already celebrate the next premiere, with the BMW i3, as we electrify the heart of BMW.”

During the nine-month period, the BMW Group benefited from its globally balanced footprint, which helps the company offset differences in sales performance across key regions worldwide. Excluding Chinese sales, the BMW Group brands achieved growth of +8.2%, with solid increases in the key regions of Europe (+8.6%) and the Americas (+9.5%). 

In the third quarter, the BMW Group posted revenues of € 32,314 million (Q3 2024: € 32,406 million/-0.3%, adjusted for currency translation effects +3.4%). Year-to-date at the end of September, revenues were lower than the previous year, at € 99,999 million (2024: € 105,964/-5.6%; adjusted for currency translation effects -3.9%).

Significantly lower R&D spending and capital expenditure

As previously announced, the BMW Group has transitioned from last year's record levels of future investment, which were required for electrification and digitalisation of the portfolio across all model series, as well as for development of the Neue Klasse.

Expenditure for research and development was down significantly in the first nine months, at € 5,941 million (2024: € 6,642 million/-10.6%; Q3: € 1,921 million;Q3 2024: € 2,473 million/-22.3%) – despite the ongoing product offensive and ramped-up preparations for the first models of the Neue Klasse. The R&D ratio decreased to 5.9% in September MTD as well as YTD (2024: 6.3%/-0.4 percentage points; in Q3 2024: 7,6%).

As planned, capital expenditure was also significantly lower, at € 4,410 million for the nine-month period and € 1,674 million for the third quarter (2024: € 5,641 million/-21,8%; Q3 2024: € 2,185 million/-23,4%). The capex ratio stood at 4.4% for the year to the end of September and 5.2% for the third quarter (2024: 5.3%; Q3 2024: 6.7%).

A capex ratio of less than 6% is forecast for the full year, moving closer to the company’s long-term target range of below 5%, as planned.

The BMW Group also achieved a moderate reduction in sales and administrative expenses, in line with forecasts, bringing costs down to € 6,077 million for the year to the end of September (2024: € 6,587 million/-7.7%; in Q3: € 1,995 million; Q3 2024: € 2,188 million/-8.8%).

“As previously announced, this expenditure was lower than last year in every quarter. We are reaping the benefits of having invested in the future early, with the peak now already behind us. In the fourth quarter, we expect further cost reductions, as well as lower research and development spending and capital expenditure. We are systematically managing costs with a measured approach, aiming to continue delivering captivating, innovative premium vehicles – and being consistently profitable,” said Walter Mertl, member of the Board of Management responsible for Finance.

Group pre-tax earnings exceed € 8.0 billion

Group earnings before tax (EBT) totalled € 8,056 million for the first nine months (2024: € 8,861 million/-9.1%)and € 2,329 million for the third quarter (Q3 2024: € 838 million).

The Group EBT margin came in at 8.1% for the YTD September and 7.2% for the third quarter (2024: 8.4%/-0.3 percentage points; Q3 2024: 2.6%/+4.6% percentage points). Group net profit amounted to € 5,712 million in the year to the end of September (2024: € 6,132 million/-6.8%; in Q3: € 1,697 million; Q3 2024: € 476 million).

In the first nine months, the Automotive Segment generated revenues of € 87,164 million (2024: € 90,863 million/-4.1%, adjusted for currency translation effects -2.2%; in Q3: € 28,510 million; Q3 2024: € 27,854 million/+2.4%, adjusted for currency translation effects +6.4%). Headwinds resulted from intensified global competition and financial measures aimed at supporting and strengthening dealer profitability in the challenging China market. Volume growth predominantly takes place there in the price segment below RMB 150,000 (~€ 18,000) and the growing product offer of local manufacturers leads to fierce competition across the entire market.

Additionally, negative currency translation effects, particularly from the US dollar, South Korean won and Chinese renminbi, have dampened income.

The segment’s earnings before financial result (EBIT) totalled € 5,120 million for the first nine months (2024: € 6,028 million/-15.1%; Q3: € 1,494 million; Q32024: € 634 million/+135.6%). In the prior-year quarter, sales and revenues were affected by technical campaigns related to the Integrated Brake System (IBS).

The EBIT margin for the YTD September came in at 5.9% (2024: 6.6%/-0.7 percentage points; in Q3: 5.2%; Q3 2024: 2.3%/+2.9 percentage points).

Excluding depreciation resulting from the purchase price allocation of BBA of around 1.1 percentage points, the EBIT margin was 7.0% for the year to the end of September and 6.3% for the third quarter. Expenses resulting from higher import tariffs in the United States and the European Union further weighed on these margins: amounting to approx. 1.5 percentage points in the first nine months and around 1.75 percentage points in the third quarter.

Pre-tax earnings and lower capital expenditure boost free cash flow

Free cash flow improved year-on-year, bolstered by higher cash inflows from operating activities, significantly lower investment activity (- € 1.4 billion) and reduced inventory levels, reaching € 2,688 million at the end of the nine-month period. In the third quarter, free cash flow totalled € 343 million (2024: - € 191 million; Q3 2024: - € 2,480 million). For the full year, the segment's free cash flow is now expected to be > € 2.5 billion (previously: > € 5 billion).

The BMW Group is implementing its share buyback programme with continuity and consistency: Following the renewed authorisation of the Annual General Meeting on 14 May 2025, the Board of Management has approved a third share buyback programme, with a volume of up to € 2 billion, to be completed by 30 April 2027. Acquisition of the first tranche of € 750 million began in May 2025 and will be completed no later than 8 December 2025.

As of 30 September 2025, BMW AG held more than 6.2 million treasury shares from the third buyback programme. Based on the authorisation granted at the Annual General Meeting of 14 May 2025, as of 30 September 2025, BMW AG had purchased shares equivalent to 1.01% of the share capital.

“With the third share buyback programme since 2022, the BMW Group is consistently implementing its shareholder return strategy. We remain committed to our shareholders and stand by the announcements we have made. Our employee share programme will also continue,” said CFO Mertl. “At the same time, we are maintaining our payout ratio of 30-40% of net income attributable to BMW AG shareholders.” 

Financial Services Segment sees continued new business growth

In the Financial Services Segment, the number of new financing and leasing contracts concluded in the first nine months of the year rose slightly to 1,275,607 (2024: 1,252,251 contracts/+1.9%). This significant growth in new business in the third quarter (450,935 contracts/+12.1%) was mainly due to a shift in the Chinese competitive landscape, where local banks have substantially reduced their commission rates for brokering financial and insurance products to retail customers.

The segment's volume of new business also increased slightly to € 48,500 million after nine months (2024: € 46,531 million/+4.2%). This reflects growth in new contracts, with a higher financing amount per contract. The penetration rate increased to 46.4% (2024: 42.3%/+4.1 percentage points).

For the year to the end of September, the segment reported pre-tax earnings (EBT) of € 1,836 million (2024: € 2,146 million/-14.4%). This dampening effect was mainly due to lower income from the resale of end-of-lease vehicles, with the number of returned vehicles below the previous year's level. For the nine-month period, the credit loss ratio was in line with the previous year, at 0.26%, across the entire finance portfolio (2024: 0.26%).

BMW Motorrad posts higher margin in YTD September 

With 159,156 deliveries in the year to the end of September, BMW Motorrad achieved an EBIT margin of 10.8% (2024: 9.5%/+1.3 percentage points).

Full-year guidance for 2025

On 7 October, the BMW Group adjusted its annual guidance for the following KPIs:

• Group earnings before tax** are projected to decline slightly (previously: on a par with the previous year).
• RoCE in the Automotive Segment is expected in the range of 8-10% (previously: 9% to 13%).

Despite lower volume expectations for the Chinese market in the fourth quarter, the BMW Group is still targeting slight sales growth for the full year.

In the Automotive Segment, the EBIT margin for 2025 is still forecast to be within the guided target range of 5-7%, more specifically in the range of 5% to 6% in light of the earnings headwinds mentioned previously.

In the Financial Services Segment, Return on Equity is projected to be between 13-16%.

In the Motorcycles Segment, an EBIT margin within the range of 5.5-7.5%is forecast as before, with a RoCE of 13-17%. The segment is now anticipating a slight decrease in customer deliveries (previously: slight increase).

The BMW Group’s actual business performance may deviate from the expectations outlined above – for example, due to changes in political and macroeconomic conditions. Risks to earnings could arise, among other factors, from changes in tariff policy or Chinese export restrictions affecting rare earths, battery cell production or semiconductors. At the same time, opportunities could result from a reduction in existing tariffs or a shorter period of validity. The company continues to monitor macroeconomic developments very closely.

The BMW Group will continue to benefit from its young and attractive product line-up and from its proven technology-neutral approach. At the same time, thanks to its flexibility, globally balanced footprint and strong financial position, the company is able to adapt to dynamic market conditions, while consistently pursuing long-term success.

**As of 1 January 2025, the forecast range for Group EBT has been adjusted. For details, please refer to the glossary in the BMW Group Report 2024.

GLOSSARY – explanatory comments on key performance indicators

BEV

Battery Electric Vehicle.
Deliveries to customers

A new or used vehicle is recorded as a delivery once it is handed over to the end user (which also includes leaseholders under lease contracts with BMW Financial Services). In the US and Canada, end users also include (1) dealers when they designate a vehicle as a service loaner or demonstrator vehicle and (2) dealers and other third parties when they purchase a company vehicle at auction and dealers when they purchase company vehicles directly from the BMW Group. Deliveries may be made by BMW AG, one of its international subsidiaries, a BMW Group retail outlet, or independent third-party dealers. The vast majority of deliveries – and hence the reporting of deliveries to the BMW Group – is made by independent third-party dealers. Retail vehicle deliveries during a given reporting period do not correlate directly to the revenues that the BMW Group recognises in respect of that particular reporting period.

EBIT

Profit before financial result. Profit before financial result comprises revenues less cost of sales, less selling and administrative expenses and plus/minus net other operating income and expenses.

EBIT margin

Profit/loss before financial result as a percentage of revenues.

EBT

EBIT plus financial result.

EBT Margin

Profit/loss as a percentage of revenues.

PHEV

Plug-in-hybrid electric vehicle.

RoCE

Return on capital employed (RoCE). RoCE in the Automotive and Motorcycles segments is measured on the basis of relevant segment profit before financial result and the average amount of capital employed – at the end of the last five quarters – in the segment concerned. Capital employed corresponds to the sum of all current and non-current operational assets, less liabilities that generally do not incur interest.

RoE

Return on equity (RoE). RoE in the Financial Services segment is calculated as segment profit before taxes, divided by the average amount of equity capital – at the end of the last five quarters – attributable to the Financial Services segment.

If you have any questions, please contact:

BMW Group Corporate Communications

 Dr Britta Ullrich, Finance Communications

Telephone: +49 89 382-18364

Email: britta.ullrich@bmwgroup.com

Max-Morten Borgmann, Head of Communications BMW Group, Finance, Sales

Telephone: +49 89 382-24118

Email: max-morten.borgmann@bmwgroup.com

Media website: https://newsroom.bmwgroup.com/global/en

Email: presse@bmwgroup.com

The BMW Group

With its four brands, BMW, MINI, Rolls-Royce and BMW Motorrad, the BMW Group is the world’s leading premium manufacturer of automobiles and motorcycles and also provides premium financial and mobility services. The BMW Group production network comprises over 30 production sites worldwide; the company has a global sales network in more than 140 countries.

In 2024, the BMW Group sold 2.45 million passenger vehicles and more than 210,000 motorcycles worldwide. The profit before tax in the financial year 2024 was € 11.0 billion on revenues amounting to € 142.4 billion. As of 31 December 2024, the BMW Group had a workforce of 159,104 employees.

The success of the BMW Group has always been based on long-term thinking and responsible action. Sustainability is a key component of the BMW Group’s corporate strategy – from the supply chain through production to the end of the use phase of all products. 

www.bmwgroup.com

LinkedIn: http://www.linkedin.com/company/bmw-group/

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Instagram: https://www.instagram.com/bmwgroup

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X: https://www.x.com/bmwgroup

In 2024, BMW of North America sold 371,346 automobiles in the U.S. Though that number represents just two and a half percent of the nearly 16 million cars sold nationwide last year, it also represents a record for BMW in this country. It also represents a remarkable increase from the mere 19,419 cars sold in 1975, BMW of North America’s first year of operation.

Announcing the year-end sales total, BMW NA CEO Sebastian Mackensen called it a “fantastic result, which is a direct reflection of the BMW brand’s strength and superior product lineup.” Mackensen credited the BMW NA team as well as the dealer network, who had “established a collaborative spirit and a focused dedication to our brand as well as a clear commitment to excellence in customer service.”

Those ingredients are essential to the success of any company hoping to sell cars in this market, but they haven’t always been present in the right proportions at BMW of North America. Putting the company on track to reach successive milestones—from 100,000 cars per year to 200,000, then 300,000.

As BMW of North America approaches the 400,000-automobile milestone, it’s worth examining that effort, as well as how BMW NA has responded to significant challenges over the last 50 years, including a global recession and shifting consumer preferences.

The first of those challenges came in the late 1980s, when a sharply declining dollar-to-Deutschmark exchange rate made BMW’s cars overly expensive in the price-sensitive U.S. while stringent U.S. emissions requirements kept its highest-performing models out of this market altogether. Those factors had already seen BMW’s sales decline from a high of 96,759 cars in 1986, but they would pale in comparison to the impact of Lexus’s arrival in 1989.

Built by Toyota, a company legendary for reliability and value, Lexus offered reasonably priced, V8-powered luxury cars backed by superb customer service. Lexus took direct aim at U.S. customers who would otherwise be driving a BMW or Mercedes, and its cars were an immediate hit. Unfortunately, Lexus’s success came at BMW’s expense: In 1991, BMW of North America sold just 53,343 cars, just 55 percent of the total from five years earlier.

In response, BMW AG appointed Karl Gerlinger as President and CEO, and Victor Doolan as Head of Sales and Marketing. Their predecessors, Dr. Gunther Kramer and Carl Flesher, moved to different positions within BMW. Doolan in particular placed renewed emphasis on performance, a traditional strong suit for the Bavarian brand.

“What was clear was that our model range simply did not live up to ‘The Ultimate Driving Machine,’” said Vic Doolan. “We knew that to compete we had to excite and please the BMW owner.”

In 1993, Doolan would take over from Gerlinger as BMW NA President, while the company gained an energetic new CEO in Dr. Helmut Panke. The following year, longtime BMW enthusiast Rich Brekus was hired as Head of Product Planning, with the goal of re-orienting the BMW NA lineup to better reflect its advertising tagline. That goal was furthered immeasurably by new V8 engines that made the 5 and 7 Series sedans more appealing to American customers, and by the surprising success of the petite Z3 roadster assembled at BMW’s recently-opened plant in Spartanburg, South Carolina.

Competition from Lexus spurred the creation of products better suited to America tastes, and it also pushed BMW NA to improve customer service at the dealer level. “Our dealer network was demotivated and unprofitable,” Doolan said. “Poor dealer service was the result.”

Doolan’s Champion Strategy put renewed focus on customer service while improving the value of BMW’s products with added features and reducing the cost of ownership via free scheduled maintenance. BMW NA improved technical training for its dealers, and made a strong effort to ensure that customers were given courteous and efficient treatment throughout their interactions with BMW dealers.

Those interactions included the purchase process, which was aided by the 1992 establishment of BMW Financial Services, a “captive finance” arm that allowed customers to complete the sale or lease without leaving the dealership. Customers could access attractive rates, and they could roll into another new BMW when their loans or leases expired a few years later. BMW NA and its dealers benefitted from increased customer loyalty, and the Full Circle program ensured that dealers would have a steady supply of high-quality used automobiles to resell. “That whole strategy was a big piece of BMW’s success going from the ’90s into the 2000s,” Brekus said.

Indeed it was. By 1996, BMW NA had recovered the ground lost to Lexus and then some, with sales reaching a record 105,761 automobiles at year’s end. A good portion of those sales were represented by the E36 M3, a lower-priced, lower maintenance version of the high-tech European E36 M3 that arrived in the U.S. in 1995. The U.S.-spec E36 M3 turned the U.S. into the world’s largest market for M cars almost overnight, a position that was solidified in 2000, when the M3 was joined by a V8-powered E39 M5 that could have been tailor-made to suit American tastes.

Also in 2000, the M cars were joined by the all-new X5. Doolan and Brekus had pressed BMW to put a Bavarian twist on the sport-utility vehicles that were replacing minivans as the preferred vehicle of American families, and the X5 became BMW’s first Sport Activity Vehicle, as Doolan dubbed it. With a powerful V8 engine and track-worthy handling, the X5 became a huge success straight out of the gate, and allowed BMW NA to “own the garage,” taking the slot that might otherwise have gone to another marque’s SUV. Assembled exclusively at BMWs’ Spartanburg plant, the X5 exemplified BMW’s commitment in the U.S. market, too. 

In May 1999, Tom Purves had taken over as BMW NA CEO following the three-year term of Dr. Heinrich Heitmann. Purves would preside over BMW NA for the next nine years, a period of unprecedented growth that saw sales reach 213,127 automobiles in 2001—more than double the total from just five years earlier. A native of Scotland, Purves was instrumental in bringing MINI to the U.S. in 2002, adding a small, sporty car to bolster BMW’s performance-oriented lineup. Customer service continued to improve, while an innovative marketing campaign including the BMW Films series brought unprecedented attention to the brand. In 2007, BMW would sell a record 293,794 cars.

By then, however, economic difficulties were already brewing in the subprime mortgage market. In 2008, the global economy slipped into a full-blown crisis. Auto sales dropped sharply, and only a federal bailout saved domestic manufacturers General Motors and Chrysler from bankruptcy. BMW NA didn’t need a bailout, but it faced considerable exposure, nonetheless. The company’s annual sales fell to 249,113 cars in 2008 and then to just 195,502 cars in 2009. Demand for new cars plummeted, and the residual value of leased BMWs fell accordingly. Here, BMW Financial Services proved crucial to BMW NA’s business model, as it continued to provide financing to customers and BMW dealers. That allowed BMW NA to outperform the industry as a whole during the worst of the financial crisis, with sales that dropped by just 32 percent compared to 54 percent for the overall U.S. market.

BMW NA’s solvency benefitted from the cost-cutting moves imposed by CEO Jim O’Donnell, who replaced Purves as CEO in 2008. Expenditures were cut further in Munich, which centralized BMW’s marketing efforts in ways that didn’t always resonate with BMW’s diehard enthusiasts, but which nonetheless helped BMW attract new customers who’d been put off by the company’s rather cool, high-tech image.

In 2011, O’Donnell was replaced by the charismatic Ludwig Willisch, who arrived in Woodcliff Lake after leading BMW’s sales operations in Germany, Sweden, and Japan. He’d also led the M division, a dream job for a performance enthusiast with a passion for motorsport, and a role that made him well-suited to lead the world’s largest market for M cars.

Along with motorsport, Willisch was passionate about improving BMW’s product quality. BMW hadn’t always fared particularly well in the crucial JD Power surveys, or in testing by Consumer Reports, so Willisch encouraged on-the-spot repairs at BMW’s vehicle delivery centers—i.e. the ports—as well as the addition of accessory items like USB adapters on the production line at. Those seemingly minor improvements had a positive effect on customer perceptions, and they helped persuade customers to stay with BMW when their lease or loan expired.

By 2013, BMW NA’s annual sales hit 309,280, a new record as well as a figure that marked the company’s full recovery from the global financial crisis. All the while, BMW’s product offerings had been moving steadily upscale, becoming larger, more complicated, and more expensive. With younger customers being priced out of new BMWs, Willisch persuaded BMW to export its smaller cars to the U.S.—in part to offset CAFE fines for excess fuel consumption—along with the affordable 320i sedan. “It may not sound too exciting, but the 320i together with the X1 and the 2 Series Coupe gave us three products to fight the competition, namely the Mercedes CLA,” Willisch said. “And we won!”

Those new models helped BMW NA’s annual sales increase to 351,851 cars in 2015, but the following year saw a near 13 percent drop to 307,672 automobiles. In the sixteen years since its introduction, the X5’s popularity had spread to Europe and China to the point that demand far exceeded the capacity of the Spartanburg plant. In an effort to satisfy demand from all markets, BMW NA’s allocation of X5 production was well below the requested number.

“We simply didn't have the product, and if you’re not ready to deliver, you lose out,” Willisch said. “In the U.S., people go to the dealership and want to drive home with a new car. If you say no, they can’t have it, they’re not only frustrated but they’re going to buy something else. And it isn’t the case that a customer who wants a German car won’t consider an American brand, because they’ll consider almost any SUV that’s available.”

The X5’s global popularity prompted BMW to expand production beyond Spartanburg, BMW’s “Center of Competence” for SAVs and the main assembly plant for the X6 Sport Activity Coupe as well as the midsize X3. In 2018, BMW added X3 production in China, allowing BMW NA to sell a greater number of Spartanburg-assembled X5s in the U.S. Even so, BMW NA’s annual sales had recovered to just 311,093 cars in 2017, when Willisch retired as CEO.

To replace him, BMW’s Board of Management selected Bernhard Kuhnt, who’d previously been responsible for sales in all of BMW’s import markets. (He’d also helmed the U.S. sales subsidiary for a rival German automaker, giving him valuable experience in the Americas.) Also in 2017, BMW NA appointed Shaun Bugbee as Executive Vice President of Operations, and Stefan Richmann as Executive Vice President of Finance and CFO.

Replacing its top three executives in one fell swoop was unusual, but it allowed BMW NA to transform its culture to emphasize teamwork rather than hierarchical leadership. The company’s new priorities were laid out in a presentation called “Team USA: Leading The Way,” which addressed important topics like profitability, customers, dealers, product and brand through illustrations and simple phrases rather than a complicated mission statement.

“It was a reference point for the BMW NA vision of where we would like to go, and how we get people to buy in on it,” Kuhnt said. “All of a sudden, you saw the company going in the right direction.”

Improving BMW NA’s relationships with its customers and dealers was crucial and so was having the right products for the market. The X5 supply was now adequate, but BMW NA still lacked an SAV with three rows of seating or a full-size battery-electric vehicle (BEV) with comparable range to an internal combustion vehicle. While Tesla was transforming the BEV market with its 300-mile Model S, BMW’s sole BEV offering was the i3 city car, which could cover barely 100 miles between charges. “My role, together with the product team in America, was to make Munich aware of what’s happening, how successful Tesla was, and how they’re taking market share away from established manufacturers,” Kuhnt said.

By 2019, BMW NA had the cars it needed to be successful in the U.S. market. After a long gestation, the X7 brought the crucial third row of seating to the SAV segment, bookending a full lineup of X vehicles that started with the compact X1. Also in the compact class, the M2 filled out a lineup of M cars that culminated with the elegant M8. Crossovers between the M and X vehicles ensured that customers didn’t need to choose between utility and performance.

Sales rebounded smartly that year, and BMW NA entered 2020 with some 40 new or substantially revised models to offer U.S. customers, including an exciting new M4. The company was looking forward to a banner year, but fate had other plans. That March, the COVID-19 pandemic brought the global economy to a near-standstill, just as the financial crisis had done twelve years earlier. Once again, BMW’s sales organization scrambled to adapt, this time with online sales tools and other new ways of selling cars. BMW Financial Services made its own accommodation, adjusting payments or extending lease terms for its 1.3 million customers. 

In terms of both business and public health, the recovery from the COVID-19 pandemic would be erratic. By 2023, however, BMW NA was once again setting new sales records, with 362,244 cars in 2023 followed by another record of 371,346 cars in 2024. It’s a small number relative to the U.S. automobile market as a whole, but it has made BMW the biggest-selling premium brand in the U.S. for five years running commanding roughly 16% of the premium segment.

The key, Bugbee says, is a strong and varied lineup, starting with the small cars. “I think the 2 Series, the M2, the X1, and the X2 actually play a vital role as far as people coming into the brand,” Bugbee said. “The M2 does about 80 percent of the volume of the M3, which is our staple performance model, and that makes it a very strong product.”

The U.S. continues to be the world’s largest market for M cars, which make up about 20 percent of BMW NA’s total sales. The X vehicles, led by the Spartanburg-assembled X5 and X3, remain the most popular, constituting some 60 percent of BMW NA’s sales volume and reflecting a commitment to the U.S. as more than just a market. The remaining 20 percent are battery-electric or plug-in hybrid vehicles, including the long-range i4, i5, and i7 BEVs that Bugbee said make BMW “the Number One conquest vehicle from people coming out of the Tesla.”

That product array reflects the “Power of Choice” strategy announced by BMW’s then-board member for sales Pieter Nota at the 2019 Los Angeles auto show. Rather than use powertrain-specific platforms like the carbon-fiber chassis built for the i3 and i8, BMW now employs two basic architectures—one for rear/all-wheel drive vehicles and the other for front/all-wheel drive vehicles—that can accommodate all of BMW’s drivetrain options. That allows customers to choose virtually any BMW or MINI model equipped with an internal combustion engine, hybrid, or battery-electric drivetrain, and it makes the company’s cars singularly appealing among automakers. Thanks to the “Power of Choice” flexible vehicle architecture, BMW NA posted record sales in 2023 and 2024, and it looks likely to set another new record in 2025 despite an uncertain business environment.

“At the end of the day, we have a variability that our customers can choose from,” said VP of operations Bugbee. “It’s not about having the cheapest car but about having the right product set. If someone wants a seven-seater SUV or a two-seater or a sedan, we have that product. That variety of offerings, along with having our dealer network in lockstep with us in terms of product presentation and competitive offers, has really led to that sustained growth. Our product offering is really our secret sauce.”

From the outside, the building that houses the BMW Car Club of America Foundation is fairly undistinguished, as one would expect of a former pharmaceutical warehouse in Spartanburg, South Carolina. Inside, however, it’s a treasure trove of BMW ephemera, and the only museum outside Munich devoted exclusively to BMW. Dubbed “The Ultimate Driving Museum,” this humble space has been hosting truly spectacular exhibits since 2017, when guests were invited to explore a world-class collection of BMW race cars entitled Heroes of Bavaria.

To say the Foundation hit it out of the park with its first exhibit is no overstatement. Heroes of Bavaria featured a mind-blowing group of cars, from a 1939 328 sports racer to a Z4 GTLM raced by BMW Team RLL in the IMSA series in 2013 and 2014. In between, the exhibit included the first of two 700 RS Spyders raced by the BMW factory team in 1961 and ’62, the Miller & Norburn 2002 that carried Nick Craw to the 1973 IMSA BF Goodrich title, the only 3.0 CSL built as a rally car by BMW Motorsport, and the BMW Motorsport 3.0 CSL that won the 24 Hours of Daytona in 1976. Heroes also included a slate of M3 touring and GT racers, all with significant histories, plus BMW of North America’s trio of March-BMW prototypes from the 1980s, the factory IMSA Group 4 M1, 1996 McLaren F1 GTR, and 1999 Williams-BMW V12 LMR. BMW’s open-wheel racers were represented by a 1981March-BMW F2, a 2003 Formula BMW, and a Williams-BMW FW22 raced in Formula One in 2000—to name just a few of the cars in the exhibit.

By the time Heroes of Bavaria opened, the BMW CCA Foundation was 15 years old, though its roots go back to 1991. That’s when Tammi Hull served as an instructor at a car control clinic hosted by the BMW CCA’s Golden Gate Chapter, of which she’d been president since 1990. “I saw how transformational it was for those kids,” Hull said. Four years later, she joined the club’s national board and suggested that it provide teen driver education nationwide via a nonprofit 501(c)(3) organization.

A second dimension was added to the proposed foundation when longtime CCA member Dennis Ryan died, leaving behind a trove of memorabilia that his widow wanted to donate to the club. Hull suggested that the nonprofit could serve two missions: teen driving education and historical preservation. “[Executive director] Wynne Smith started planning to finally bring it to life in 1999,” Hull said. “Wynne was the driving force that made it happen.”

The BMW CCA Foundation was chartered in March 2002, and in 2003 it began hosting Street Survival teen driving clinics with major support from Tire Rack, BMW of North America, and Liberty Mutual Insurance. Street Survival teaches young people to control cars at the limit while improving their accident avoidance skills well beyond what they could learn from their parents or high school driver’s education programs. Headed by Bill Wade, Tire Rack Street Survival holds more than 100 schools each year, hosted nationwide by chapters of the BMW CCA, Porsche Club, and Sports Car Club of America. “I get emails on a weekly basis thanking me for running the program, from parents telling me it saved their kid’s life,” Wade says, noting that car accidents are a leading cause of death among young people.

The other half of the Foundation’s mission—and that which led to the creation of The Ultimate Driving Museum—involves preserving BMW’s rich history, which archivist Michael Mitchell has been doing since he became the Foundation’s first employee in 2002. Following the initial donation of Ryan’s memorabilia, the Foundation’s collection has become the largest repository of BMW-related items and documents in the US, and it’s accessible to the public in accordance with the Foundation’s non-profit mission.

In 2013, the Foundation moved into its permanent home in Greer, South Carolina, directly adjacent to the BMW Performance Center and just across the highway from BMW Manufacturing, where X-vehicles are assembled for worldwide consumption. A former pharmaceutical warehouse, the Foundation’s space has been transformed to house the archives and host exhibits. Those exhibits began with modest displays of cars owned by the Board of Trustees, then took a crucial step toward professionalism and historical interest when Heroes of Bavaria opened on May 19, 2017.

Heroes was the brainchild of the Foundation’s first executive director, Scott Dishman. Dishman had attended BMW’s 2016 centenary celebration at Laguna Seca and wanted to stage a similar display of BMW’s motorsport history.

“Our request to BMW of North America was this: You had an amazing exhibition of race cars at Laguna Seca, but most BMW enthusiasts on the East Coast never got to see it, and almost none of the 9,000 associates that work at BMW Manufacturing here in South Carolina got to see it,” Dishman said. “Let us recreate that, as best we can, and hold it for a while so that enthusiasts in this part of the country can make their way here over the course of the next three or four months and enjoy it.”

Thanks to cooperation from BMW NA’s Tom Plucinsky, the Foundation arranged to borrow nearly the entire race car collection owned by BMW Classic USA. “We were really happy to be able to do this,” Plucinsky said. “I’d much rather have these cars on display for people to see and appreciate rather than hidden in our warehouse. The only thing that could be better than having them at the Foundation would be having them on the track.”

Private owners—including Foundation trustees Peter Gleeson, Scott Hughes, and Lance White—loaned yet more race cars, and the result was a jaw-dropping collection that covered BMW’s entire motorsport history in the US…and beyond. Each car’s history was chronicled by Jackie Jouret, whose research was published in a beautifully-printed exhibit catalog illustrated with photography by Zach Suggs.

Heroes of Bavaria marked the start of an annual exhibition-and-book series at the BMW CCA Foundation. It was followed in 2018 by “The ICON”, a celebration of the 2002’s 50th birthday that included every 2002 variant produced by BMW, as well as a fine selection of modified cars. Adding to The Icon’s visual appeal, the 2002s on display encompassed the range of colors in which the model was offered, from the sedate beiges of the early 1600-2s to the jewel tones and florescent “safety colors” of the 1970s models.

For its third exhibit in 2019, the Foundation celebrated a half-century of the BMW Car Club of America with “PASSION: 50 Years of BMW Cars and Community”. That exhibit featured 22 BMWs that had inspired particular passion among enthusiasts, each owned by a dedicated club member of long standing.  

PASSION was followed by an even more spectacular exhibit, entitled “GENESIS: BMW from the Beginning”. GENESIS covered BMW’s history from its origins as a manufacturer of airplane engines from 1916, through its addition of motorcycles in 1923 and automobiles in 1928. It included a trio of significant motorcycles, including a 1927 R47 sport bike and a 1931 R2 single, as well as a number of pre-war and early postwar automobiles, beginning with a 1930 3/15 HP DA2 believed to be the oldest BMW in the US.

BMW didn’t begin exporting cars directly to the US until 1954, and then only in limited volume until the 1600-2 became a surprise hit in 1967. Its earlier cars are rare in this country, yet GENESIS assembled a comprehensive selection of automobiles that told the full story of BMW’s prewar success and postwar reconstruction. The cars and motorcycles were loaned to the Foundation by US collectors including Dirk de Groen, Manny Carter, Manfred Scharmach, Rick Meinig, and Karra Cannum, to name but a few. Nearly all had significant histories: Meinig’s 327/28 convertible, for example, was originally owned by Schorsch Meier, a factory BMW motorcycle racer who won the 1939 Isle of Man TT as well as numerous championships. Two postwar BMWs built at Eisenach revealed Germany’s Cold War cleavage into two states, giving attendees a rare look at these BMWs built under Soviet domination. Others had more personal histories, like the 1960 3.2 Super sedan that Alf Gebhardt inherited from his father, its original owner.

Alas, few were able to see GENESIS in person, as the Covid pandemic forced the closure of public spaces like The Ultimate Driving Museum shortly before the exhibit was set to open in May 2020. While the exhibit’s opening was on hold, the Foundation released a video by David Rose that highlighted the beautiful BMWs waiting to welcome guests when the doors finally opened that fall.

“Doing the virtual video opening was important,” said trustee Bruce Hazard, explaining that the museum wasn’t the only Foundation activity affected by the pandemic. “We kept the museum open as much as possible given the city, county, and state restrictions, and we didn’t give up! But we were forced to close down Street Survival temporarily, because we couldn’t expose students or instructors in the closed environment of the car.”

With the worst effects of the pandemic in the rear-view mirror, and following Dishman’s departure at the end of 2019, the Foundation carried on with a mini-exhibit on the history of the Z-cars produced across the street by BMW Manufacturing, and full exhibits celebrating the 50th anniversary of BMW Motorsport in 2022, and the 100th anniversary of BMW motorcycles in 2023. Last year, the museum took a comprehensive look at MINI, exhibiting a range of pre-BMW Minis from the 1960s to the highly personalized MINIs of the current era under BMW’s ownership of the marque. In 2025, the Foundation is celebrating ALPINA with a similarly thorough exhibit. As always, opening and closing events give attendees an opportunity to mingle with the cars’ owners as well as Foundation trustees and BMW NA executives.

The BMW CCA Foundation has helped turn Greer, South Carolina into the epicenter of BMW enthusiasm in the US, especially given its proximity to BMW Manufacturing and the BMW Performance Center. (The headquarters of the BMW Car Club of America and Motorcycle Owner’s Association are nearby, as well.) The Foundation benefits further from a close working relationship with BMW of North America and MINI USA, both of which support the organization’s efforts to preserve company history. Crucially, BMW Classic USA has raised money for the Foundation by offering rides in its fleet of vintage race cars at the Performance Center and other tracks.

“We at BMW NA are very fortunately to have passionate club and foundation organizations that love our products and enjoy sharing our history. Our job at BMW NA is to help both the club and the foundation thrive. Over the years, as the company has grown, we have come to rely on the BMW CCA Foundation to preserve our archival materials and display elements. It is a synergy that works very well for the company and the club members”. Added Plucinsky.

Equally important, the Foundation has strong ties to the BMW collector community throughout the US. Its board of trustees includes a number of past presidents and national officers of the BMW CCA and many of the country’s most prominent collectors, ensuring that the Foundation has a firm connection to the car club at large as well as strong sources of expertise and support.

“Many of the trustees have given decades of service to the club, devoting a ton of time and energy to making these ideas come to life,” Wensberg says. “The club has a lot to be proud of in terms of what the Foundation has accomplished.”

—end—

With its corporate headquarters located directly across the street from the site of Munich’s Olympiapark, BMW is a natural partner for the Olympic movement. When the Games were held in Munich in 1972, BMW’s battery-powered Elektro-Auto 1600 paced the marathon and speed-walking events.

In 1996, the Olympic Games were held in Atlanta, Georgia, just two hours up the highway from BMW’s new assembly plant in Spartanburg, South Carolina. That presented BMW of North America with the perfect opportunity to sponsor the Games, supplying a fleet of cars and motorcycles for the nationwide Torch Rally as well as the Games themselves. That sponsorship resumed when Salt Lake City hosted the 2002 Winter Olympics, and parent company BMW AG followed with its own sponsorship of the London Olympic Games in 2012.

Those efforts put BMW in front of global audiences during the immensely popular Games, but they didn’t mark the limits of BMW’s Olympic effort. As sports came to rely on technical innovation and data analysis, BMW’s expertise became a valuable commodity for Olympic athletes. In 2008, BMW AG lent its Munich wind tunnel to Germany’s bobsled and luge teams, helping them increase their aerodynamic efficiency in advance of the 2010 Winter Games in Vancouver, British Columbia. The result? Three gold, three silver, and two bronze medals for the German athletes.

When BMW of North America became the Official Mobility Partner of the US Olympic Committee in 2011, the company wanted to do more than simply provide the team with vehicles. Like BMW in Munich, BMW NA wanted to lend its technical expertise to athletic performance. Somewhat surprisingly, USA Track & Field asked for help with the long jump, an event that involves nearly no equipment—just a jumper, a take-off board, and a sand pit. Despite that simplicity, world long jump records have proved remarkably durable. Bob Beamon’s world record of 29.2 feet stood from 1968 to 1991, and Mike Powell’s record of 29.4 feet had stood for twenty years when BMW began helping USA Track & Field athletes try to break it.

Technique and training play an outsized role in an athlete’s success, and long jumpers were accustomed to analyzing their form using film or video. The utility of that method was limited, however, as it couldn’t tell them their speed down the approach or at launch, and neither could it precisely analyze their take-off angle.

Enter the BMW Technology Office in Palo Alto, California, where advanced technology engineer Cris Pavloff decided to apply the camera techniques used on BMW’s cars to prevent accidents. Rather than a single camera angle, this equipment provided a “stereo” view of an athlete in motion. Initially, this resulted in an information overload, which Pavloff solved by having the athlete wear a white cap that could be tracked by the cameras. That made the data usable—and in real time.

“The feedback this tool is able to provide during a practice, as opposed to days after, will enable me to make minor adjustments in my jumps that could equate to significant performance gains,” said Bryan Clay, who won the Olympic gold medal in decathlon at the 2008 Games.

Alas, Clay didn’t make the US Olympic Team in 2012, but American Will Claye won a bronze medal. Claye didn’t break the world record, however, and neither did the athletes who took gold or silver ahead of him. As of this writing, Powell’s 1991 long jump record still stands.

Pavloff and the BMW Technology Office provided similar “stereo-vision” technology to USA Swimming, which used it to analyze a swimmer’s dolphin kick within the 15 meters that swimmers are allowed to remain underwater after the start. Swimming is always a strong sport for Team USA, and the American athletes came home from London with 16 gold, eight silver, and six bronze medals.

In advance of the 2014 Winter Games in Sochi, BMW DesignworksUSA would apply its technical expertise to build a two-man bobsled for the US Olympic Team. “This is a uniquely challenging project for BMW, yet is as close to automotive design as possible,” said Michael Scully, then the Creative Director for Global Design at BMW DesignworksUSA in Southern California. “That allows us to utilize our race car experience combining aerodynamic design, new materials, CFD (Computational Fluid Dynamics) testing and evaluation, and wind tunnel testing for a non-automotive vehicle.”

Scully chose to build the sled not in the usual fiberglass but in lightweight carbon fiber. BMW had more expertise with carbon fiber than most auto manufacturers, having elected to use it for the chassis of its i3 and i8 automobiles as well as the America’s Cup yachts BMW built for Oracle Racing. As in other disciplines, carbon fiber’s light weight would allow the bobsled chassis to situate weight in the ideal position to optimize performance, though most improvements would be gained through aerodynamic efficiency. In this area, Scully’s team was able to compare data from CFD testing with that generated in the wind tunnel, correlating the two data sets to ensure accuracy and reduce drag from specific components.

While the chassis was getting the high-tech treatment, so was the bobsled’s steering mechanism. Though the driver controls the sled via a rope attached to the front runners by D-rings, BMW NA’s IMSA race team, BMW Team RLL, improved the steering mechanism to which the ropes are attached, and lowered it for better weight distribution.

“The cool thing about our new BMW sleds is that they really smoothed out the steering mechanism,” said driver Elana Meyers Taylor, who’d raced a pre-BMW bobsled to a bronze medal in the 2010 Games. “If that motion is really jerky, a lot of friction is created as the sled moves across the ice, which makes it hard to have a good, smooth line and time. But BMW has really worked hard to make it a smooth mechanism, which allows us to make mistakes and still be fast. It’s given us the opportunity to compete week after week at the highest level.”

The BMW-built bobsleds raced for the first time at the 2013 World Cup in St. Moritz. Although they didn’t triumph outright, they scored second-place finishes for Meyers Taylor and Katie Eberling, and Steven Holcomb and Curt Tomasevicz. (Prior to BMW’s involvement, Holcomb had driven Team USA’s four-man bobsled to a gold medal at Vancouver in 2010.)

At Sochi for the 2014 Winter Olympics, Meyers Taylor and Lauryn Williams raced to a silver medal, while Jamie Greubel Poser and Aja Evans took bronze. “When I come down the track and knew I’d made mistakes, I realized I would have to be happy with the silver medal,” Meyers Taylor said. On the men’s side, their compatriots Holcomb and Steve Langton scored another silver medal—the USA men’s first in 62 years—racing their BMW-built bobsled.

BMW of North America continued to partner with Team USA through 2016, and DesignworksUSA made another big effort to improve the team’s performances in Rio de Janeiro. This time, the impetus came from Team USA’s Paralympic athletes.

“I went to BMW Designworks to help pitch the idea of building a racing chair for the team,” said Paralympic wheelchair racer Josh George, who’d won a gold medal at Beijing in 2008. “Five minutes into our very first conversation, they were rattling off ideas. I’d never gotten to work with a group of people that wholeheartedly dove into my world and were able to offer productive, insightful feedback. It was amazing.”

That was necessary, said Designworks Associate Director Brad Cracchiola. “We needed to know about the intricacies of the sport. There are thirteen rules and regulations that cover the design of a racing wheelchair, and we would have to work with those as well as find out what worked well for the athletes. It looks fairly simple, but it’s far more technically complex.”

As Scully’s team had with the bobsled, Cracchiola’s team used BMW’s racing experience to maximize the aerodynamic efficiency of the chair and the athlete. Instead of the traditional aluminum or titanium tubes, they crafted the chassis in carbon fiber, which increased stiffness, reduced weight, and improved aero performance by allowing components to be formed in different shapes. As they would a racing car, they also molded a carbon fiber seat to each athlete’s body, giving them maximum security and perfect alignment when they hit the wheels with their hands to gain forward momentum.

Before the Rio Games, Team USA’s Tatyana McFadden tested the BMW chair, which she found much improved over her previous equipment. “The new chair was very stiff,” McFadden said. “The old titanium chairs had a lot of flex over time, and a lot of drag. It was built to be semi-aerodynamic, but it wasn’t as aerodynamic as we thought it was.”

Along with the racing chair, the athletes’ gloves came in for analysis at Designworks. Previously, each athlete had made the gloves themselves, using a moldable but hard-setting putty to create a striking surface that would fit precisely the ring that propels the wheels. BMW replaced that putty with lightweight, heat-resistant material formed with 3D printing technology, which allowed Designworks to perfect the gloves incrementally until they were perfect for each athlete. 

“I’ve been racing with the U.S. team since 2004, and I’ve gone through pairs of gloves I’ve had to make myself,” George said. “There’s always a huge worry factor: Are the new gloves going to be worse than those you’re currently using? BMW changed that, and it’s just a huge step forward for us.”

George didn’t win a medal at Rio, but other athletes racing the BMW-designed chairs did. McFadden won four golds to add to the three she’d won four years earlier in London, while her teammate Chelsea McClammer racked up two silvers and one bronze medal. BMW of North America also sponsored Olympic swimmers Nathan Adrian, who won two gold medals in the relay events, and Maya DiRado, who won two golds, one silver, and one bronze in individual races.

BMW of North America’s sponsorship of Team USA expired in 2016, but the impact of Designworks’ efforts to improve the equipment used by American athletes continues to reverberate throughout the Olympic and Paralympic movements. BMW of North America’s technology expertise helped Team USA Olympic and Paralympic athletes bring home 40 medals. The design world noticed, too: In 2016, the BMW-built bobsled won a Red Dot award, the equivalent of an Oscar for designers, and in 2017 the racing wheelchair won another Red Dot award.

If you were following the business news on March 16, 2009, you might have noticed an interesting transaction involving SGL Carbon, the world’s largest supplier of carbon fiber and carbon fiber products, including automotive brakes. On that date, the SKion investment firm spent approximately €140 million to acquire more than 5 million shares in SGL, or 7.92 percent of the company. With it came a seat on the SGL board for SKion principal Susanne Klatten, a 12 percent owner of BMW and the daughter of BMW’s 1959 savior, Herbert Quandt. (With her siblings, Klatten owns just under half of all BMW shares.)

Klatten’s investment constituted a masterstroke of vertical integration. BMW had begun using carbon fiber on its M cars in 2005, when the E63 M6 was equipped with a roof and bumper supports in carbon fiber reinforced polymer (CFRP). And in 2007, BMW Chairman Norbert Reithofer announced a multi-faceted program called Efficient Dynamics that aimed to improve all aspects of BMW’s vehicles, from engine performance to aerodynamics, and which promised a significant weight loss, as well. Carbon fiber would help BMW realize that, and it would also be essential to containing the weight on the battery-electric Megacity Vehicle being developed under Project i, another initiative that began in 2007.

The supply of suitable carbon fiber isn’t infinite, however, but Klatten’s investment in SGL Carbon would ensure that BMW had access to as much of the material as it needed. It would also ensure that BMW’s competitors didn’t, especially after Klatten raised her stake in SGL Carbon to 22 percent shortly after making her initial investment. In 2009, BMW and SGL formed a new joint venture, SGL Automotive Carbon Fiber, in which BMW held 49 percent of shares.

On July 7, 2010, SGL Automotive Carbon Fiber broke ground for a $100 million plant in Moses Lake, Washington, a joint venture between SGL and BMW. The site was chosen not for its proximity to SGL headquarters in Wiesbaden, Germany or to BMW’s plants in Bavaria and beyond, but for the clean, abundant, and relatively inexpensive hydroelectric power generated by dams along the Columbia River. 
As BMW Board Member for Finance Friedrich Eichiner announced at the plant’s groundbreaking, “Lightweight construction is a core aspect for sustainable mobility improving both fuel consumption and CO₂ emissions, two key elements of our EfficientDynamics strategy. By combining the know-how of SGL Group and our expertise in manufacturing CFRP components, we will be able to produce carbon fiber enhanced components in large volumes at competitive costs for the first time. This is particularly relevant for electric-powered vehicles such as the Megacity Vehicle.”

BMW wasn’t alone in recognizing carbon fiber’s potential, however. In February 2011, rival automaker Volkswagen and its supplier Voith combined to acquire 17 percent of SGL, threatening Klatten’s control. She countered by increasing her holdings to 27.3 percent, and with it gained veto power over any decisions made by the SGL board. That November, her position was strengthened by BMW’s institutional acquisition of an additional 15.16 percent of SGL; with Klatten, BMW now controlled nearly half of this essential manufacturing resource, and it would increase its stake still further over the next few years. In April 2013, Klatten would be named Chairperson of the SGL board of directors.

The Moses Lake plant became operational in 2011, just as Klatten and BMW were expanding their control over SGL as a whole. Then and now, the plant handles the second stage of a production process that begins with polyacrylonitrile (PAN) precursors spun into threads at SGL factories in Otake, Japan and Lavradio, Portugal. At Moses Lake, those precursors are converted into carbon fiber through exposure to extreme heat—first about 460 degrees, then 1,300 degrees, and finally 2,550 degrees—which doesn’t burn the fibers but expels all of their non-carbon components and leaves long chains of interlocked carbon atoms. These carbon fibers are then sent to SGL’s factory in Wackersdorf, Germany, where they’re woven into sheets that can be formed into parts at factories like BMW’s plant in Landshut, Bavaria. There, BMW had devised new manufacturing processes, including a resin transfer molding process that allowed carbon parts to be produced in about one minute, and which didn’t require the use of an autoclave for curing.

The start of operations at Moses Lake and the collaboration with BMW represented “a major renaissance and paradigm shift for the automotive industry,” said Andreas Wuellner, SGL’s Managing Director for Automotive Carbon Fibers.

The first products of the SGL-BMW partnership were indeed revolutionary. The carbon fibers created at Moses Lake were used to build the chassis for BMW’s all-new Megacity Vehicle, which went into production in 2013 as the i3. The i3 used what BMW called “Life-Drive Architecture”, in which the carbon-fiber body shell constituted the “Life Module” which provided the crash structure for the occupants while the aluminum battery tray, electric powertrain and suspension comprised the “Drive Module”. It was the first series-production vehicle to use a CFRP body shell, and it was followed in 2017 by the similarly constructed gasoline-electric hybrid i8 sports car in 2014.

In both cases, construction of the CFRP body required fewer parts and less time than a steel body, though it remained significantly more expensive despite the advantages of vertical integration. In the case of the i3 and i8, however, CFRP was essential to keeping the cars within their weight targets. BMW had set a target of 2,750 pounds for the i3, which the production car met easily at 2,635 pounds. That allowed BMW to equip both cars with smaller and less expensive batteries, balancing the cost.

Interestingly, Boeing made a similar calculation when it chose carbon fiber for the fuselage of its 787 Dreamliner jet. In 2012, BMW and Boeing announced their plans to collaborate on the recycling of carbon fiber, enhancing the material’s environmental friendliness at the end of its life cycle.

Carbon fiber would be used more sparingly in BMW’s conventional cars, and only where its lighter weight would make a real difference to performance. In 2014, the new E9X M3 and M4 used carbon fiber for their driveshafts, roof panels, and bumper bars, saving 36 pounds from those three components alone. In the F82 generation that followed, the limited-production 2016 M4 GTS would be equipped with CFRP aerodynamic elements, and it could be ordered with optional carbon fiber wheels that saved 14.5 pounds of unsprung weight.

In the non-M sector, BMW equipped the sixth-generation 2015 7 Series with a “Carbon Core” chassis, which combined CFRP with steel and aluminum to maximize rigidity while minimizing weight. That hybrid approach was undoubtedly expensive, however, and it wasn’t applied to other cars in the BMW lineup, nor on the seventh-generation 7 Series.

Indeed, BMW was shifting from widespread use of carbon fiber, and in particular from bespoke carbon fiber body shells like those used on the i3 and i8. Discontinued in 2022 and 2018, respectively, those cars would remain outliers in the BMW automotive universe. Though the forthcoming Neue Klasse electric cars will be revolutionary in their own way, they’re unlikely to make extensive use of carbon fiber.

In 2017, SGL and BMW announced that SGL would purchase BMW’s 49 percent stake in its Automotive Carbon Fibers joint ventures in Germany and the US. BMW would retain its 18.3 percent shareholding in SGL Carbon, and the companies would continue to collaborate on smaller parts, like the enclosures for BMW’s EV batteries. (Volkswagen continues to hold 7.4 percent of the company.)

BMW’s decision had a strongly adverse effect on SGL’s fortunes. “Due to the termination of a supply contract and weak demand from the automotive industry, Composite Solutions was unable to repeat its good figures from the previous year,” said SGL CEO Dr. Torsten Derr last summer. “We do not see any recovery for the business unit Carbon Fibers even after six months in 2024.”

It was an interesting experiment, one that captivated tech-minded enthusiasts, but it’s one that BMW is unlikely to repeat, especially as energy costs continue to rise worldwide.

What does “the future” look like? How will we live, and what will we drive?

For automakers, these questions are existential, and most expend considerable resources trying to answer them. That was relatively easy throughout most of the 20th century, but it became more difficult in the 21st, as the pace of change increased exponentially—not only with respect to technology, but also where demographics are concerned.

“The world around us is changing,” said BMW Board Chairman Norbert Reithofer in his address to the annual meeting of BMW shareholders on May 15, 2007. He identified several near-term challenges, including new competition from China and an aging workforce in Germany.

More interestingly, Reithofer cited “mobility in the world’s largest cities” as a potential impediment to BMW’s business prospects. “We expect mega-cities such as Shanghai, Tokyo, Mexico City, Rio de Janeiro or Los Angeles, but also London and Paris, to grow further. Traffic density in urban spaces is rising dramatically. Already, some cities are trying to intervene by implementing regulations on traffic flow. The question is: What consequences does this trend have for us?”

Within the same speech, Reithofer noted the need to address climate change by developing powertrains that use less fossil fuel, or none at all. “The number of environmental disasters around the world is rising, and the UN report clearly shows how fast climate change is happening, even though this is not visible to the naked eye,” Reithofer said. “Everyone has to be prepared to make a contribution to climate and environmental protection.”

To achieve those goals, Reithofer announced BMW’s Strategy Number ONE, which included the creation of an in-house think tank dubbed Project i. Project i, Reithofer said, was “working on completely new car and mobility concepts for megacities.” The team was “fully independent and even free to act beyond BMW structures if necessary. The task of Project i is to present specific solutions in the first half of the next decade [2010-2020].”

Given the goals of Strategy Number ONE, it seemed likely that Project i would focus on an electrified powertrain, and not only for zero-emissions mobility. “The technology is now sophisticated enough to offer sheer driving pleasure,” Reithofer noted.

Initially, the Project i team led by Dr. Ulrich Kranz used off-the-shelf components to develop a prototype battery-electric powertrain, which would be tested in a MINI platform that reflected the planned dimensions of the forthcoming Megacity Vehicle. In 2009, the team built 500 MINI E test cars, 450 of which would be field-tested for two years by customers in the Los Angeles and New York metropolitan areas. BMW of North America engineers took the lead in analyzing the MINI E’s performance under a variety of conditions—including cold weather—and use scenarios.

“We know our customers well,” said Rich Steinberg, BMW NA’s then Head of Electric Vehicle Operations, “so not only are we looking at it from a technological standpoint—what we need to incorporate in the next-generation car—but also the psychographics and the mindset issues: What do they need in terms of range anxiety? What do they need from public charging network standpoint? We’re feeding all that back to the team working on Project i [in Munich].”

In its second phase, Project i moved from off-the-shelf components to an asynchronous electric motor designed in-house at BMW, powered by battery cell technology from a new Samsung/Bosch joint venture. This powertrain would be tested in 1 Series dubbed the ActiveE, with 700 of 1,000 prototypes tested by US customers under supervision from BMW of North America.  

As with the MINI E, the engineers were keen to determine exactly how much battery capacity was required to make the ActiveE functional in real-world use. Range and performance would suffer if the battery was too small, but a larger battery would add weight, which itself would compromise performance. They settled on a battery weighing close to 600 pounds—far heavier than an internal combustion engine—which in turn required the weight of other components to be minimized. Crucially, the battery in the Megacity Vehicle would be located in the floor of the car, the optimum location for agile handling.

In July 2010, BMW announced that the Megacity Vehicle would be the world’s first series-production car to have a chassis built from carbon fiber reinforced plastic (CFRP) – an ultra-lightweight material used to build Formula One cars and the Boeing 787 Dreamliner. Carbon fiber is expensive, but BMW would mitigate its cost through weight reduction and thereby a smaller battery, less expensive battery pack for an equivalent range. Also, rather quietly, BMW (and one of its principal shareholders, Susanne Klatten) had made a significant investment in SGL Carbon, the world’s largest supplier of carbon fiber and carbon fiber products. Together, BMW and SGL had formed a new joint venture, SGL Automotive Carbon Fiber, building a new factory in Moses Lake, Washington to supply carbon fiber for BMW’s Megacity Vehicle.
A carbon fiber chassis and a battery-electric powertrain would attract technology enthusiasts to the Megacity Vehicle, but the car needed to reach a wider audience to justify BMW’s investment. Toward that end, BMW embarked on a public-relations campaign in September 2010, launching a dedicated website to share the philosophy and future projections that underpinned the car’s development. The website featured slickly-produced videos that made compelling arguments for electric mobility.

The Megacity Vehicle was the prime focus of Project i, but it would soon be joined by a futuristic sports car that originated with the Vision EfficientDynamics Concept that premiered at the Frankfurt IAA in September 2009. The Vision EfficientDynamics was received enthusiastically, which persuaded BMW to develop it as a sporty companion to the Megacity Vehicle.  

In February 2011, BMW announced the creation of the “i” sub-brand, along with a new slogan: Born Electric. The Megacity Vehicle would go into production as the battery-electric i3, while the Vision EfficientDynamics would become the i8, with a gasoline-electric plug-in hybrid powertrain. Both cars would be built at BMW’s Leipzig plant, in a new hall dedicated to CFRP body shell construction, thermoplastic outer body panel formation, and electric powertrain installation.

Both cars made their debut in near-production form at the Frankfurt show that September. The super-sexy i8 drew rapturous applause, while the boxier, more upright i3—and its minimalist interior made of recycled or renewable materials—elicited a more restrained response.  

After a six-year gestation, the i3 went into production in September 2013. The first cars arrived in the U.S. in the second quarter of 2014, with a retail price of $41,350 that was offset by a $7,500 federal tax credit that increased by another $2,000 in states like California.

Thanks to its CFRP body shell and aluminum chassis, the i3 tipped the scales at a very svelte 2,635 pounds, and the electric motor provided the equivalent of 174 horsepower, enough to propel the i3 from zero to 37 mph (60 km/h) in just 3.7 seconds. Initially, its battery capacity was rated at 60 amp-hours or 18.8 kilowatt-hours, enough for about 80-100 miles of driving. In 2017, BMW increased the i3’s battery capacity to 94 amp-hours, and complemented the standard model with the sport-tuned i3s.

“Our customers told us that wanted to have the i3 even sportier,” said Dr. Robert Irlinger, who took over Project i leadership at the beginning of 2017. “BMW i customers are still BMW customers, and BMW is about sheer driving pleasure. That’s the reason we worked on the powertrain. found some extra horsepower, some extra torque, worked on the suspension. It’s a little wider, and we brought it down by 10mm, so the chassis was optimized. The result is really great.”

In 2019, the i3 got a further increase in battery capacity, to 120 amp-hours. Throughout its production cycle, the i3 had been available with an optional ICE range extender ($3,850) that roughly doubled its range but didn’t provide motive power.

The range extender was convenient, but using it negated one of the i3’s most compelling qualities: the ultra-quiet interior. BMW had modeled the i3’s interior acoustics on an anechoic chamber, and the combination of its vibration-damping carbon chassis and near-silent electric powertrain created a truly serene driving environment. It was spacious, too, with no transmission tunnel to interrupt the flat floor, and filled with light from its tall greenhouse.

Though it handled like a go-kart, the i3 was precisely the opposite of raucous, enthusiast-oriented cars like the M3 or M5. It represented a true departure from the BMW status quo, and not all of BMW’s traditional customers would embrace it. Neither would all of BMW NA’s dealers, though the number who did “was by far bigger than we had anticipated,” said BMW NA CEO Ludwig Willisch. Those dealers had to create a dedicated space in their showrooms to separate the i-cars from their conventional counterparts, and they also had to ramp up their knowledge of battery-electric and hybrid powertrains, not to mention their skill in repairing new materials like carbon fiber.

The i3 was Project i’s bread-and-butter model, but the halo was provided by the i8, which went into production in April 2014 and carried a retail price in the US of $135,925 before government incentives. That was downright cheap for a stylish sports car with a state-of-the-art hybrid powertrain, particularly one with a CFRP body and aluminium chassis. The car weighed just 3,278 pounds and had a drag coefficient of just 0.26, which allowed it to reach 62 mph in just 4.4 seconds—3.8 seconds using Launch Mode—despite having a fairly modest 362 combined horsepower from its three-cylinder turbocharged engine and electric motor.

Alas, the i8 was discontinued in June 2020, by which time 20,465 examples had been built for worldwide consumption; of those, over 6,700 reached the U.S..

The i3, meanwhile, was becoming far more popular following a slow start. From just 16,052 units in 2015, annual sales topped out at 39,501 in 2019. Production of both cars was limited by the capacity of the Leipzig plant.

Though the i3 and i8 had a limited lifespan, those who purchased these cars became ardent boosters. In Los Angeles, a group of i3 enthusiasts who call themselves “The Electronauts” hold regular rallies and tech sessions, just as enthusiasts of conventional BMWs have done for decades. Most Electronauts have installed solar panels and battery storage units at their homes, and all appreciate its undersung performance. “It’s a zippy little devil!” said Electronaut Andrew Kim.

Project i’s sales figures may seem fairly modest considering BMW’s estimated $2 billion investment in Project i, but the i3 was the third best-selling electric car in the world for much of its lifespan. Moreover, the numbers were secondary to the transformation Project i effected within BMW.

With negligible fuel consumption—even the hybrid i8 returned close to 50 mpg—the i cars made an important dent in BMW of North America’s Corporate Average Fuel Economy rating. The i cars also served as the pioneers for BMW’s electrified powertrains, which began making their way into mainstream BMW vehicles shortly after the i3’s debut.

The long-term effects of Project i were acknowledged by new BMW Board Chairman Harald Krüger—who replaced Norbert Reithofer in May 2015—in his March 2016 address to shareholders. That speech seemed to signal the end of Project i, as did Kranz’s departure at the end of 2016.

Under Krüger’s brief leadership, which lasted only through August 2019, BMW used the lessons learned with Project i to initiate the next steps of BMW’s electrification. One of the key lessons was that BEV adoption varied widely around the world and that BMW – at least in the medium term – would need to have the flexibility to adjust its BEV mix based on local market demands. In the USA for example, Los Angeles, San Francisco and Seattle quickly adopted the BMW i3 whereas other areas of the country were far behind. The result was BMW’s “Power of Choice” architecture in which two flexible vehicle architectures (one for larger front engine-rear drive vehicles, the other for transverse front engine-front drive vehicles) would be developed that could accommodate any powertrain type (from pure ICE to PHEV to BEV). This would give BMW the flexibility to quickly shift production mix to market demand as the worlds markets shift toward electric powertrains.

In 2021, BMW released the first of the new “Power of Choice” architecture vehicles in the USA: The BMW i4 and the 4 Series Gran Coupe. But for the front grilles and the badges on their trunk lids, all were outwardly identical to their internal-combustion counterparts, as are more recent battery-electric BMWs like the i5 and i7. As of the end of Quarter 2, 2025, BEVs built on the aforementioned flexible architecture represent 14% of total BMW sales in the USA. If hybrids are included, electrified vehicles currently account for over 21%.

The flexible Power of Choice architecture was initially criticized in Europe for being too conservative and not fully embracing the switch to BEV only. However, history has shown that it was a shrewd and effective solution to satisfy the demand for all powertrain types in the markets that BMW competes in around the world.

Nevertheless, BMW was already hard at work developing the next vehicle architecture – in this case another full BEV architecture known as the Neue Klasse. In September 2025, BMW introduced the all-new BMW iX3 – the first of the Neue Klasse models. This iX3 is built on all the lessons learned in its electrification journey and is expected to be available for sale in the USA towards the middle of 2026. More on that vehicle in a future chapter.

                                                                 

If you were alive on September 11, 2001, you undoubtedly remember a fall day that dawned crystal-clear in the New York metropolitan area. You undoubtedly remember, as well, the exact moment you learned that a pair of passenger jets had been flown into the twin towers of the World Trade Center in New York City, followed by a third into the Pentagon and a fourth into a Pennsylvania field. 

“I had ridden my motorcycle to work that morning, and I distinctly remember the deep blue, cloudless sky and the crisp fall air,” said Tom Plucinsky then General Manager of BMW Motorcycles. “The air was so clear that the Manhattan skyline—including the twin towers—were backlit beautifully as I rode south on Highway 17 towards the office in Woodcliff Lake. To this day, I think of those conditions as ‘September 11’ weather.”

As the crow flies, the World Trade Center is barely 25 miles from BMW of North America’s headquarters in New Jersey. Most senior managers were out of the office on September 11, attending the Frankfurt auto show, and those who remained in Woodcliff Lake were just starting their work day when the first aircraft hit the tower at 8:46 am.

“My assistant came into my office and said, ‘I just heard that a plane flew into one of the twin towers,’” Plucinsky recalled. “Our initial thought was that a private pilot in a small plane had somehow hit one of the towers. We only had one television in the building, so I went down to the cafeteria to see what was on the network news. All of the stations were breaking away from the morning shows to live footage of the tower burning.

“Then, on live TV, the second plane hit [at 9:03 am]. All of us huddled around the TV knew that it was no accident, and that we had just witnessed a terrorist attack on American soil using passenger jets as weapons.”

Half an hour later, at 9:37 am, American Airlines Flight 77 crashed into the Pentagon, making it clear that a coordinated attack was taking place. A fourth jetliner had also been hijacked, but it failed to reach its target—presumed to be the White House or US Capitol—after its passengers overwhelmed the hijackers and forced the plane to crash.

That was United Flight 93, en route from Newark to San Francisco with 44 passengers and crew. The flight had been delayed at takeoff, and left the runway at 8:42 am, just as the first plane hit the World Trade Center just across the Hudson River from New Jersey. Some passengers might have seen that happen by looking out the windows, while others found out about the attacks via cell phone messages from people on the ground.

Forty-six minutes after takeoff, hijackers stormed the cockpit, attempting to turn Flight 93 into another weapon of mass destruction.

Its passengers didn’t let that happen. Instead, they fought the hijackers for control of the aircraft, and the plane went down near Shanksville, Pennsylvania at 10:03 that morning. None on board survived, but a greater disaster had been averted.

Like the planes flown into the World Trade Center and the Pentagon, Flight 93 had been hijacked by Al-Qaeda terrorists. Their attack claimed the lives of 2,977 people in the initial incidents, followed by many who later died from exposure to debris.

Among those killed on Flight 93 was BMW of North America’s Environmental Compliance Manager, Linda Gronlund. Gronlund was traveling to San Francisco with her boyfriend, Joe Deluca. Following a business meeting, Gronlund and Deluca planned to celebrate her 47th birthday in the Napa Valley.

Gronlund had worked for BMW NA since 1990, having joined the company after five years in Volvo’s product compliance office. She was a serious foreign car enthusiast, having grown up working on cars with her father in Sag Harbor, New York; later, she served as chief of flagging and communications for the Sports Car Club of America in Northern New Jersey. She’d studied English and chemistry at Southampton College, then earned a law degree at American University in 1983.

At BMW, Gronlund was able to combine her love of cars with another of her passions: the environment. As Environmental Compliance Manager, her responsibilities ranged from obtaining permits for BMW Manufacturing in South Carolina to overseeing the installation of BMW’s hydrogen refueling station in Oxnard, California.

Some 45 minutes after Flight 93 took off from Newark, Gronlund called her sister Elsa. As reported in Sag Harbor newspaper 27 East in 2021, Gronlund told her sister that the plane had been hijacked by terrorists who said they had a bomb. A few minutes later, several passengers rushed the cockpit in an attempt to thwart the hijacking. Trained in martial arts, Gronlund may have been among them. They were unable to take control of the aircraft, and the pilot crashed the plane into a field near Shanksville, Pennsylvania before it could reach its presumed target, the White House in Washington, DC. All 44 people on board were killed.

A day or two later, the news that Gronlund had been on Flight 93 reached BMW NA headquarters, bringing the terrible events of 9/11 even closer to home. Gronlund had been a valued colleague, of whom BMW NA’s General Manager of Engineering Karl-Heinz Ziwica said, “I could rely on her to do anything. She got things done and she got them done right. Always.”

Her colleagues held a memorial for Gronlund at BMW NA, which was livestreamed to BMW Manufacturing in Spartanburg, South Carolina. Shortly thereafter, BMW of North America endowed a scholarship for female engineering students at the Massachusetts Institute of Technology, while her home town of Sag Harbor, New York, renamed a nature preserve in her honor. In Woodcliff Lake, BMW of North America installed a permanent memorial to Linda Gronlund—a garden and bronze plaque—between the 200 and 250 buildings of its headquarters campus.

In 2012 the BMW Group partnered with the National Park Foundation making a $10,000 contribution to the Flight 93 National Memorial Campaign as part of our commitment to remembering and celebrating the life of our former colleague.  With the contribution, BMW of North America became a co-sponsor of the project to beautify the memorial through the planting of thousands of trees. The crash site and memorial is atop a former coal mine which had been devoid of any natural beauty.

In the immediate aftermath of the disaster, BMW of North America donated $1 million in cash to the American Red Cross Disaster Relief Fund and the City of New York. (BMW NA continues to support the American Red Cross, most recently by making two donations of $1 million each in the wake of Hurricane Helene and the wildfires in Los Angeles.) The company also donated $2.4 million in vehicles—ten new X5s and 100 ex-CHP police motorcycles—to replace those lost by various agencies on September 11.

The Pentagon had lost vehicles and equipment in the attack, too, along with 125 of its people. Following an initiative by VP of Legal Affairs Howard Harris, BMW NA donated ten bikes to the Pentagon Police, which was happy to receive them. Over the ensuing decades, the agency has purchased several more authority motorcycles from BMW.

Though the story of 9/11 is one of terrible loss, every tragedy contains stories of lucky escapes like the one made by BMW enthusiast Colonel Mark Volk, whose office in the Pentagon took a direct hit from American Airlines Flight 77. “He had just left his office for a cup of coffee,” said Kenn Sparks, then a Communications Manager at BMW Manufacturing. “He immediately ran back to rescue people, and he was one of the great American heroes of 9/11.”

Sparks heard Volk’s story during a Roadster Homecoming at BMW Manufacturing, which Volk attended as a Z3 owner. “The keys to his Z3 were in his briefcase, and he couldn’t get back to his office to see if his keys were still there,” Sparks said. “Two weeks later, he found the remains of his briefcase. The keys were still inside, and he drove his roadster home.”

The Spartanburg plant itself had an accidental connection to 9/11, thanks to a fortuitous display of patriotism. Since 1999, BMW Manufacturing had constituted BMW’s sole assembly facility for X5s. In July 2001, an engineering pre-production X5 was damaged in a crash during an internal management ride and drive event.  The vehicle was sent to Performance Center workshop across the highway from the plant for repairs. There, it would be repaired by technicians and body shop personnel under Workshop Manager Dan Doot.

By August, the bodywork had been repaired, and the vehicle was ready to be painted. Rather than the original silver, Doot, always ready for an interesting paint project, opted for an American flag motif inspired by the fuel tank on the motorcycle ridden by Peter Fonda in the film Easy Rider. Since this wasn’t an officially approved project, Doot and some of the Body and Paint STEP students painted the vehicle on evenings and weekends, taking about three weeks to finish it. When it was due to be returned to the engineering department, they didn’t appreciate Doot’s initiative and insisted that it be repainted back to silver. Doot refused, and a stalemate ensued.

Shortly after 9/11, BMW Manufacturing Vice President Carl Flesher saw the flag-painted X5 at the Performance Center and immediately saw its potential as a communications tool. He requisitioned for it to be transferred to the Corporate Communications department and placed it in front of the Zentrum, where it could be seen by drivers passing by along Interstate 85.

In the wake of 9/11, said Business Communications Manager Kenn Sparks, the flag-motif X5 “took on a life of its own. People started taking photos of it, and it became an icon of BMW’s commitment to the US.”

Doot’s X5 ended up being used in parades around the country. The vehicle has made countless public appearances, including a trip to SEMA in Las Vegas with wheel manufacturer BBS, outfitted it with a set of BBS wheels that remain on the vehicle today.

The flag X5 remains one of a kind, though it’s not the only BMW with a patriotic paint job. It has a counterpart within the BMW Classic USA race car collection, the #6 E46 M3 GTR that won the final round of the 2001 American Le Mans Series. That race was scheduled for October 6, barely three weeks after the attacks.

“We were debating whether to pull out, what’s proper after that horrible event,” said Bill Auberlen, one of BMW’s factory drivers that year.

The 2001 season had already been challenging for BMW of North America’s Team PTG, which was racing against not just archrival Porsche but a two-car team entered by BMW Motorsport Team Schnitzer. The German team’s technical advantages had allowed it to take five wins to just one for BMW of North America’s Team Prototype Technology Group (PTG), and the American team was considered the underdog going into the four-hour Petit Le Mans at Road Atlanta. In the wake of 9/11, Team PTG would race under the weight of a national tragedy, too.

The PTG livery already featured red fenders and spoilers to distinguish the BMW NA cars from their white-blue BMW Motorsport counterparts. For Petit Le Mans, PTG boss Tom Milner replaced the logo of tire sponsor Yokohama with a blue field covered in white stars, turning the hood, roof and rear deck lid on each of the team’s three M3s into a rolling American flag.

Two of three PTG entries went out of the race in the early running, but PTG’s #6 car had been fast throughout. As the laps wore down, the car driven by Auberlen, Hans Stuck, and Boris Said was in a position to defeat not just the Porsches but both M3s entered by BMW Team Schnitzer. “We just ran it like crazy,” Auberlen said. “I came in for the last pit stop on the lead, and Tom [Milner, head of PTG] wanted to put on super-soft tires just to rub it in.”

After four hours, Auberlen took the checkered flag one lap head of the second-place #43 BMW Motorsport Team Schnitzer car. “That race was very emotional,” Auberlen said. “The only time we had that paint job, it wins. People didn’t know whether to smile or cry.”

Today, the #6 E46 M3 GTR is a treasured part of the BMW Classic USA collection, as is the American flag X5. Both vehicles serve as poignant reminders of the tragedy of 9/11, and the unity of spirit that followed.

No industry wants to be regulated, and it goes without saying that automakers dislike regulation. Yet even those automakers most opposed to regulation have to admit that it can prod them into making safer and more efficient cars, or even to develop entirely new product lines.

That’s exactly what happened after 1966, when the State of California enacted the world’s first vehicular emissions regulations, followed in 1970 by the federal Clean Air Act that would require smog testing of all new vehicles from 1972-on. In response to that legislation, BMW began replacing carburetors with fuel injection, creating the 2002 tii and other models that not only emitted fewer pollutants but used less fuel and produced more power than their carbureted counterparts.

Reducing motor vehicle emissions was a step in the right direction, but eliminating them entirely would be even better. To meet that goal, at least at the tailpipe, automobile manufacturers would need to shift from internal combustion engines to the battery-electric powertrains that were common in the late 19th and early 20th centuries, but which faded from use as gasoline became widely available.

BMW wasn’t building cars during the first electric age, having been founded as an aero engine manufacturer in 1916 and only adding motorcycles and cars in 1923 and 1928, respectively. The company didn’t make its first foray into electromobility until 1972, when BMW premiered its first electric car during the Olympic Games being held right across the street from its Munich headquarters.

At first glance, the Elektro 1602 looked like an ordinary BMW two-door, and as such it drew less attention than BMW’s futuristic Turbo Concept, which also debuted during the Munich Olympics. As a harbinger of the actual future, however, the Elektro was far more significant, pacing the Olympic marathon and speed-walking events in near-silence and with zero tailpipe emissions.

The Elektro 1602 was powered by 12 lead-acid batteries, and its range was limited to about 44 miles. That may have been an optimistic estimate: BMW had built not one but two Elektro 1602s, and it’s rumored that one took over from the other when the marathon passed through a tunnel. In any case, the car’s range couldn’t be improved upon without adding considerable battery weight to the vehicle, so BMW began exploring liquified hydrogen as its preferred route to zero-emissions mobility.

In the meantime, electric vehicles received a major boost from the US government’s Electric and Hybrid Vehicle Research, Development and Demonstration Act of 1976. That legislation provided funding to develop the battery-electric powertrains that would become increasingly important after 1990, when the State of California instituted its Zero Emission Vehicle mandate. From 1998-on, ZEVs would need to constitute 2 percent of all vehicles sold in California, the nation’s largest market for automobiles and one of the largest worldwide.

Even while focusing on hydrogen power, BMW experimented with electric cars that could meet California’s ZEV mandate. The E1 and E2 concepts of 1991 used sodium-sulfur batteries for a theoretical range of 155 miles, but those were ultra-lightweight city cars, and the technology didn’t fare as well in a series-production BMW. In 1995, the company built a small fleet of 3 Series coupes that used the standard four-cylinder internal combustion engine not to drive the rear wheels but to charge the sodium nickel chloride battery and extend the car’s range beyond 27 miles. It wasn’t a success.

“The E36 electric vehicles were terrible,” said Rich Brekus, then head of product planning and strategy for BMW NA. “Karl-Heinz Ziwica was head of compliance, and I asked him if it was possible to make gasoline cars that would pollute the same amount of NOx and hydrocarbons as the power plant used to produce the electricity. It was theoretically possible, so we met with the California Air Resources Board, which agreed to back off on the electric vehicle mandate if we built Partial Zero Emissions Vehicles that would put out one-tenth of the US standard for pollution, with zero evaporative emissions and a ten-year warranty.”

Indeed, when California’s ZEV mandate was set to increase to ten percent in 2003, the state adjusted that figure to allow credits for Partial Zero Emissions Vehicles like BMW’s new Super Ultra Low Emissions Vehicles. “Now millions of PZEVs are on the road, and it’s made a huge difference to the quality of air in California,” Brekus said.

In 2007, BMW announced its new Efficient Dynamics program, which chairman Norbert Reithofer said would reduce BMW’s overall fleet emissions by 25 percent by the year 2020. (It’s worth noting that BMW, like the European Union, focused exclusively on reducing CO2 emissions, which relate directly to fuel consumption, while excluding the NOx emissions that the US and its states regulate.) At the same time, BMW concluded its experiments with liquified hydrogen, which had proven impractical as a motor fuel. Instead, the company would focus on improving efficiency by reducing vehicle weight—a somewhat Quixotic goal—and by offering ever-more-efficient internal combustion engines alongside new hybrids and battery-electric vehicles. 

The latter would be developed separately, under the rubric of Project i. An in-house think tank led by Dr. Ulrich Kranz, Project i wasn’t merely about developing a viable EV, but about understanding how we would live and move about in the not-so-distant future. Having determined that human populations were increasingly concentrated in “megacities” with 15 million or more inhabitants, Project i set about creating a so-called Megacity Vehicle that would emit neither noise nor pollution, and which would take up as little space as possible in those crowded urban environments.

By focusing on urban mobility, Project i managed to avoid one of the biggest psychological drawbacks of electric mobility: range anxiety. As the Elektro 1602 and later 3 Series had demonstrated, the usable range of electric cars had long been hampered by the limited storage capacity of their batteries. Fortunately, research was underway that would begin to solve that problem.

Since the 1970s, engineers had been developing lithium-ion batteries, which combined high capacity with relatively light weight and rechargeability. By 1991, these new batteries had been widely adopted for use in consumer electronics, and in 1998 they found their first automotive application in Nissan’s experimental Altra EV. In 2003, the AC Propulsion T-Zero was designed by Tom Gage to use lithium-ion batteries, and it inspired Tesla Motors’ engineers Martin Eberhard and Marc Terpenning to do the same on the Tesla Roadster, which reached the public in 2008. With an EPA-rated range of 244 miles, the Tesla Roadster could nearly match that of an internal-combustion vehicle, and it was as quick as any supercar.

Lithium-ion batteries would power the Megacity Vehicle being developed by the Project i team, which reached its first prototype stage as the MINI E. The MINI was chosen for its small size, which mirrored that of the planned Megacity Vehicle, and for its ability to accommodate Gage’s AC Propulsion battery-electric powertrain following the removal of its rear seats. 

That powertrain used 1,088 lithium-ion cells strung together within a 573-pound battery back, which gave the MINI E the equivalent of 201 horsepower. It could accelerate from zero to 62 mph in 8.5 seconds en route to a top speed of 95 mph. Needless to say, it would have to be driven far more sedately to achieve its claimed 156-mile range.

Though BMW tested 50 of its MINI E prototypes in Munich and Berlin, 450 would be tested in the US—specifically in Los Angeles, New York City, and New Jersey—and with ordinary customers at the wheel rather than engineers. According to Rich Steinberg, then Head of Electric Vehicle Programs for BMW of North America, the locations were chosen for their proximity to BMW NA workshops, where the cars could be serviced if needed. “The dealers weren’t trained in high voltage yet. We also had ‘flying doctors’ who would be dispatched to service vehicles at a local dealer if needed.”

As another benefit to testing vehicles in California, the program would help BMW of North America earn significant Zero Emissions Vehicle credits, as well as lowering BMW’s Corporate Average Fleet Economy rating in the US.

It would also draw plenty of interest from customers eager to go electric. When the program was announced, BMW received thousands of applications, from which it selected participants on the basis of their driving habits and ability to install a charging system in their home garage. That factor proved more complicated than expected when the cars used a plug developed in Europe. “It didn’t have UL approval, and local electrical inspectors made home installation a real chore,” Steinberg said.

The cars would be leased to customers for one year, though that was later extended for a second year. The price was set at $850 per month, and customers would be required to provide feedback on the experience.

In May 2009, Pacific Palisades, California resident Peter Trepp became the first customer to take delivery of a MINI E. A venture capitalist specializing in clean energy funding, Trepp blogged about his experiences beginning with his acceptance to the program and the installation of the 50-amp charging outlet in his home garage. That was crucial, since public charging was basically nonexistent. Upon taking delivery, Trepp noted that the MINI E handled like a sports car despite carrying some 600 additional pounds of battery weight compared to a standard MINI, and that its regenerative braking feature made it unnecessary to touch the brake pedal except in emergencies. Driving enthusiastically, Trepp reported 95-100 miles of range on a full charge, and he didn’t miss the sound of an internal combustion engine or having to stop for gas.

Living in sunny Southern California, Trepp didn’t get to experience the biggest downside to battery-electric driving: severely reduced range and performance in cold weather. “They were absolutely miserable on cold days,” said Jim McDowell, then head of MINI USA. “If you used the heat, you had a very short range, which meant you had to pick between heat and getting home.”

That deficiency was addressed during the second phase of Project i testing, which would be done not in a MINI but in the BMW ActiveE, a battery-electric version of the 1 Series Coupe. The ActiveE got a much-improved battery developed in collaboration with SB LiMotive, a joint venture between Samsung and Bosch. The battery had its own liquid cooling system to help maintain storage capacity regardless of outside temperatures, and it could be activated while the car was plugged into the power grid. “That will allow you to pre-heat or pre-cool the cabin from your smartphone instead of using the battery of the car,” said Steinberg.

The battery was actually three “energy storage units” located where a normal vehicle would place its engine block, transmission, and fuel tank. The electric motor sat directly over the rear axle, and the car was driven by its rear wheels just like any other 1 Series coupe. Even with better thermal management, however, the ActiveE failed to improve upon the MINI E’s range of approximately 100 miles under normal driving conditions, though that could be extended somewhat using the new ECO PRO mode. The car was heavier than the MINI E, and its zero-to-62 mph acceleration was slightly slower at 9.0 seconds. 

BMW built some 1,000 ActiveE prototypes, of which 700 came to the US for real-world testing. MINI e test driver Trepp had opted to renew his MINI e lease for a second year, which put him at the top of the list for an ActiveE in 2012. He didn’t blog about his experiences with that car, but reported upon taking delivery that the ActiveE had “more refinement, more gadgets, more BMW. The MINI E was great, but the ActiveE is a step up, to be sure.”

Not everyone who tested an ActiveE had leased one from BMW. The cars were also available to those using BMW’s DriveNow car-sharing service, another component of Project i which operated in several European cities as well as San Francisco from 2011 to 2019. (From 2016 to 2019, the program operated as ReachNow in Seattle, Portland, and Brooklyn.) Car sharing was an important part of Project i’s mission, as it would allow BMW to expand its customer base beyond traditional ownership models. Unfortunately, local parking codes made it inordinately difficult to place cars throughout cities, dooming the program in virtually every important market.

With both prototype electric vehicles, BMW of North America and its customers played a major role in the development of a new powertrain, one that was set to take on increasing importance within BMW and throughout the world. The cars also helped develop BMW’s “circular” product economy, as the batteries from cars taken out of service were repurposed to provide stationary energy storage, particularly where solar or wind is used for generation.

Customers helped to perfect the technology, and their feedback also allowed BMW to understand what customers wanted and expected from their cars, and to deliver that when the company’s battery-electric vehicles went into production. “What do they need in terms of range anxiety? What do they need from a public charging network?” Steinberg asked.

BMW also learned about customers’ charging habits, which varied from country to country. “In Europe, they wait until they need to plug in, but American drivers plug in every day,” said Dr. Herbert Negele, who was responsible for electrification projects at BMW AG from 2007 to 2010.  “Maybe it’s the Wild West…you know you need to stock up on water when it’s available!”

Somewhat counterintuitively, that behavior helped alleviate the concerns of utility companies fearful of overtaxing the electrical grid while also encouraging the use of renewable energy sources like wind and solar.“Having a large fleet of EVs across America that could absorb and consume the energy from a renewable like wind is a benefit to the utilities, and vice-versa,” Steinberg said. “If there’s a real peak demand load and there are a lot of EVs plugged in, the grid allows the supplemental energy from these vehicles to flow back into the grid so they don’t have to fire up the plant to generate more energy.”

That sounded almost impossibly futuristic in 2012, and yet it’s become today’s EV reality. A sizable percentage of EV drivers have installed solar panels on the roof of their homes, helping to reduce not just tailpipe emissions but energy consumption overall. That’s been the goal of regulators in California and worldwide for decades, and EVs have been crucial to achieving it.

It’s worth noting that much of that reality was made possible by Tesla, a company that BMW didn’t take seriously even as Tesla was introducing its full-size Model S in 2012. With the Model S—developed using a $465 million loan from the US Department of Energy—Tesla achieved what traditional automakers had long thought impossible: a 300-mile range. That allowed the Model S to roam farther afield than any electric car of its day, even across the US thanks to Tesla’s extensive charging network. More recently, the company has begun offering solar roof tiles that generate electricity for driving and daily life, and battery storage systems for containing it. Regardless of what one thinks of the company in 2025, or its safety record throughout, Tesla Motors deserves credit for making electric vehicles viable, and for furthering the acceptance of EVs among the driving public.

In the meantime, BMW pressed forward with its Megacity Vehicle, the BMW i3, which would share the range limitations of the MINI E and ActiveE. Overcoming those limitations would take another decade, and an entirely new generation of vehicles.

How do you define the essence of BMW? Is it what the car is, or what the car makes you feel?

That question is at the heart of a controversy surrounding a 2010 BMW ad campaign that seemed to abandon BMW of North America’s longstanding The Ultimate Driving Machine tagline for the more nebulous “Joy is BMW.” The move outraged brand loyalists, not least because the campaign coincided with the introduction of cars like the 5 Series GT, aimed not at enthusiasts but at mainstream car buyers looking for a roomy interior rather than scintillating driving performance.

To brand loyalists, and to BMW of North America’s marketing executives, The Ultimate Driving Machine was more than a mere ad slogan. Coined by Martin Puris in 1975, the phrase was at the heart of what they loved about the brand, a perfect expression of their emotions surrounding BMW.

By contrast, those in the marketing department at BMW AG in Munich preferred “Aus Freude am Fahren,” the German tagline coined by the Gramm & Grey agency of Dusseldorf in 1965. In 1975, BMW dropped the “Aus,” reducing the tagline to simply “Freude am Fahren.” That translates most directly to “For the joy of driving,” which became the British tagline “Sheer Driving Pleasure” and the French “Le plaisir de conduire.”

BMW AG tolerated The Ultimate Driving Machine nonetheless, at least while BMW of North America’s sales were skyrocketing in the late 1970s and 1980s. By the end of that decade, however, BMW NA’s sales began falling thanks to Deutschmark-dollar currency fluctuations and a fresh challenge from Lexus. That put new pressure on BMW NA to abandon The Ultimate Driving Machine tagline, as well as the Ammirati & Puris agency that created it.

“Munich felt we needed fresh thinking in terms of advertising, and there was even a request of me to drop The Ultimate Driving Machine,” said Carl Flesher, then BMW NA’s Marketing Director. “I refused. I fought for Ammirati & Puris, saying they are an excellent agency, they have a feel for the brand, and advertising is not going to turn this business around. It’s got to be through product and pricing. They suggested we do the German thing, the Joy of Driving. I said, ‘I’m sorry, but the Joy of Driving just doesn’t land over here the way it does in Germany.’ It really is a linguistic issue.”

In 1992, Flesher was reassigned to BMW Manufacturing in Spartanburg, South Carolina, and BMW of North America put its advertising contracts up for review. Ammirati & Puris declined to participate, but the agency’s short-lived successor retained The Ultimate Driving Machine tagline, as did the Fallon agency hired in 1995 by new VP of Marketing Jim McDowell. Working with McDowell’s team, Fallon created innovative advertising that highlighted BMW’s identity as The Ultimate Driving Machine, as well as the technical sophistication underlying that claim. The Fallon ads used new camera angles, putting viewers in the driver’s seat as a BMW was driven with gusto on a twisty road or dry lake bed.

Those performance-oriented ads had particular resonance in the US market, McDowell said. “The psychographic of the BMW customer is much different here than in Europe. We’ve always had a higher level of specification and standard equipment in the US. In Europe, they sell some low-powered BMWs that we would not think of as being the Ultimate Driving Machine.”

In 2001, the conceptual divide between BMW NA’s advertising and that of BMW worldwide was further highlighted by the Fallon-produced BMW Films, aka The Hire. The films were intensely focused on performance, and they drew massive attention and universal praise for their high quality and emotional impact. Although they were well received in Munich—Board Chairman Dr. Helmut Panke showed them to a massive audience of BMW employees at the Olympic Stadium—the films also prompted BMW AG to exercise greater influence on sales subsidiaries like BMW NA.

In 2005, McDowell swapped jobs with Jack Pitney, taking over as Head of MINI USA while Pitney became VP of Marketing. Pitney was inclined to collaborate more closely with Munich, and also to “humanize” BMW’s image in the US.

“One criticism of BMW’s advertising over the years was that the intense focus on the cars was too cold and clinical,” said Patrick McKenna, then BMW NA’s Department Head for Marketing Communications. “Even dealers would ask, ‘Why don’t we show people in our advertising?’”

In search of a new direction, Pitney put BMW NA’s account up for review. Fallon declined to participate, and the creative account was awarded to Gurasich, Spence, Darilek & McClure of Austin, Texas, better known as GSD&M Idea City. The agency was known for the “Don’t Mess With Texas” anti-litter campaign, and for taking a humorous, offbeat approach to its subjects. Digital marketing would be handled by Kirschenbaum Bond Senecal + Partners of New York, and the two firms would work together to create a coordinated campaign across all media.

GSD&M’s work for BMW kicked off with the “Company of Ideas” campaign that premiered on May 8, 2006. The print ads were almost entirely text-based, such as the one entitled “NO” that declared BMW’s unwillingness to compromise while saying yes to the innovative ideas that make its cars Ultimate Driving Machines. For television, GSD&M used Zaha Hadid’s dramatic architecture for BMW’s Leipzig plant to highlight the firm’s openness to creativity. 

The ads were well received, not only in North America but in Munich, where Board Chairman Helmut Panke was especially enthusiastic about GSD&M’s approach. “When I presented those ads to Panke, he slammed his fist on the table and said, “YES! You’ve managed to share our corporate strategy and make it understandable,’” McKenna said.

The ads resonated with the public, as well. BMW of North America’s annual sales increased from 266,200 in 2005 to 274,432 in 2006, then to an even more impressive 293,794 units in 2007.

It wasn’t to last. In early 2008, the market for mortgage-backed securities collapsed, followed by the stock market as a whole in September. BMW of North America’s sales fell commensurately, to 249,113 cars in 2008 and to 195,502 cars a year later. In response, BMW AG made significant changes at the top of the NA org chart. After nine years as BMW NA CEO, Tom Purves was sent to Britain to head up Rolls-Royce, while his fellow Scot Jim O’Donnell took over as CEO in Woodcliff Lake.

With that, the last bastion of BMW NA’s resistance to “Freude am Fahren” was removed. “Purves always said that ‘joy’ was not the ideal translation for ‘freude.’ He was always pretty staunchly against using the word joy in communications,” McKenna said. 

O’Donnell had no such reservations. Moreover, he was on a mission to contain costs, as was BMW worldwide. Naturally, that would affect the marketing budget.

“When the E46 3 Series launched in 1998, there were 40 different ad campaigns around the world,” McKenna said. “When the company examined that, they just saw so much inefficiency. By 2005, advertising was focused on three main campaigns around the world: Europe, Asia, and the Americas. After the financial crisis, there was an intense focus on having one campaign for the world: Joy. GSD&M was invited to pitch against every major global agency, and they won.”

On May 14, 2009, GSD&M became BMW’s agency of record worldwide. The first of the “Joy” ads began appearing in other markets in June 2009, but BMW NA waited to debut the Joy campaign until February 2010, airing the ads during the Vancouver Winter Olympics and in support of the advertising-themed television series Mad Men.

The ads showed BMW’s cars cruising along sunny seaside streets or frolicking in the snow to an upbeat soundtrack, but the real focus was on those driving the cars, all of whom were smiling. “We realized a long time ago that what you make people feel is just as important as what you make,” intoned the distinguished voice of Will Lyman. “At BMW, we don’t just make cars. We make joy.”

Some of the print ads showed the car only in fragments, emphasizing a small child clinging to the steering wheel above an all-caps “JOY IS IMPATIENT” headline, or a montage of model badges above the words “JOY CAN BE COUNTED.” 

“The idea was largely driven by Jack [Pitney],” McKenna said. “It’s joy, and who doesn’t like joy? Who doesn’t like showing the human, emotional side of BMW?”

Probably no one, but within days the ads had inspired sharp criticism. The Wall Street Journal said that BMW had “parked ‘the ultimate driving machine, at least for a while. The slogan still appears in the ads, but only in small print. Many of the ads also suggest cars aren’t what BMW is offering. The text reads, ‘At BMW, we don’t [just] make cars. We make joy.’”

The Autoextremist’s Peter DeLorenzo was even more scathing. “You don’t just walk away from one of the most memorable and accurately descriptive advertising themes in automotive history ‘for a while’ as BMW says, and expect to blissfully escape any lasting repercussions or long-term effects.”

A month after the Joy campaign got underway in the US, this author discussed it with Pitney at BMW of North America headquarters. Pitney defended the campaign as an antidote of sorts to the popular perception not of BMW itself but of BMW drivers.

“Independent third-party research always seems to say that people have a very good opinion of the brand from a technical competence standpoint, but they equate BMW drivers with aggression and arrogance,” Pitney said. “That’s why we’re working to be more inclusive and add a bit more humanity in the way we talk about the brand, to try to make us a bit more approachable. What’s nice is that it actually has changed perceptions of the brand. It’s made us a bit warmer and more approachable, and it seems to be helping bring more new customers to the BMW family.”

Perhaps, but the ads themselves and the subsequent media coverage had created confusion—and distress—among BMW’s most loyal customers. Some responded by sending Pitney death threats for his supposed “parking” of The Ultimate Driving Machine, even though the tagline was still present on the ads.  As disturbing as that was, Pitney said, “I’d rather have that passion for the brand rather than just send things out there and wonder. This is a good thing. This is a very good thing.”

O’Donnell agreed. “It’s great. It proves that there are passionate BMW loyalists out there,” he said. Nonetheless, O’Donnell acknowledged, minimizing The Ultimate Driving Machine tagline hadn’t been universally appreciated. “I’ve been shocked, almost horrified, by the number of dealers who’ve come up to me and said, ‘What the hell is this? You’re giving up The Ultimate Driving Machine?’ No, we’re not!”

Despite the controversy, and despite having debuted in the midst of a global financial crisis whose effects would linger for years, the Joy campaign helped BMW’s sales increase from 195,502 cars in 2009 to 220,113 cars in 2010. (So did the incentives on auto sales within the American Recovery and Reinvestment Act of 2009, enacted under President Barack Obama.)

Before the yearly sales total could be announced, Pitney was killed in a tractor accident on August 26, 2010—days before he was set to take a new job as head of BMW NA’s Eastern Region. He’d be replaced as VP of Marketing by Dan Creed, promoted by O’Donnell from the Aftersales Division.

Shortly thereafter, GSD&M announced that it would not seek a renewal of its contract with BMW, which was set to expire at the end of 2010. Prior to GSD&M’s announcement, digital media agency KBS+P had been assigned to create BMW NA’s Super Bowl ad for early 2011—a responsibility that normally would have fallen to GSD&M. Following a review, KBS+P was awarded the entire BMW of North America account in September 2011. 

KBS+P’s Super Bowl ad promoted the 335d to the tune of David Bowie’s “Changes.” It juxtaposed other manufacturers’ sluggish, soot-belching diesels with what narrator Chris Pine described as BMW’s “clean, quiet, and powerful”  Advanced Diesels. The word “Joy” was nowhere to be seen, though the 335d’s driver was clearly having fun. Instead, The Ultimate Driving Machine appeared at the end, returned to its rightful place as the ideal descriptor of BMW’s cars.

Though the partnership with KBS+P had been fruitful, BMW of North America put its advertising account up for review in 2018. The contract was awarded to San Francisco firm Goodby, Silverstein and Partners, which had made its reputation with the “Got milk?” campaign. Goodby, Silverstein knows a good tagline when it sees one, and the agency has left The Ultimate Driving Machine where it belongs, in a prominent position in every BMW ad.

Munich. At the IAA Mobility in Munich from 9 to 14 September, MINI will transform the city into its own stage at two well-known locations: an impressive Open Space at Max-Joseph-Platz, and a central brand appearance in the MINI Pavillion at Lenbachplatz, presenting MINI’s brand DNA at the world's largest mobility event. The highlight is the world premiere of two exclusive JCW showcars, created as part of an exciting collaboration.

MINI Pavillion: MINI unveils exclusive JCW showcars.
MINI's racing background is not only evident from its recent success at the 24-hour race at the Nürburgring: motorsport has been part of the brand's essence from the very beginning. As part of the IAA, two unique MINI John Cooper Works showcars are celebrating their world premiere, the result of an inspiring collaboration.
For the duration of the IAA, the MINI Pavillion puts the models centre stage in a spectacular display. The showcars, which combine the brand's unmistakable racing enthusiasm with the spirit of a world-famous lifestyle brand, can be admired at Lenbachplatz. For this, the MINI Pavillion will be extensively remodeled, and dedicated entirely to the John Cooper Works brand.

• MINI Pavillion: Lenbachplatz 7a, 80333 München

MINI at Open Space: Heritage and humour at Max-Joseph-Platz.
A metropolis within a metropolis: With its appearance at the Open Space, MINI brings the vibrant city centre of London to the noble Max-Joseph-Platz in Munich's old town. An elaborately staged backdrop recreates the heart of the city and presents the brand’s British identity, including its humour in many details.

With the Bayerische Staatsoper and the Residenztheater in the background, the focus of Open Space is the all-electric models of the new MINI family, the high-performance MINI John Cooper Works Electric, MINI Service and MINI Experience Modes. 
With the MINI John Cooper Works Electric, MINI Aceman SE and MINI Countryman SE ALL 4, visitors will be able to experience three all-electric MINI models up close. Max-Joseph-Platz is also the starting point for test drives in cooperation with SIXT: true to the motto "Only MINI Can Do", visitors can take all-electric MINIs from the new MINI family out onto the city's streets from here.

• MINI Open Space: Max-Joseph-Platz 2, 80539 München

MINI at the IAA: Community Day unites fans of the brand.
Fans of MINI can also become part of the IAA Mobility this year: at the "Community Day" on 13 September, MINI clubs will come together for a drive with their personal MINIs. Starting at Gut Kaltenbrunn on Lake Tegernsee, the route leads through Munich and ends with an inspiring get-together with music, BBQ and dialogue with the community in the MINI Pavillion.

The IAA: a platform for experts and enthusiasts.
As one of the largest and most important international automotive trade fairs, the International Motor Show (IAA) offers manufacturers, journalists and other enthusiasts a platform for dialogue on the topics of mobility, innovation and technology every two years. The IAA Mobility 2025 is organised under the slogan "It's All About Mobility". As part of the event, innovations and concepts will be presented in four formats - at the IAA Summit, the IAA Conference, the IAA Open Space and the IAA Experience - as well as at MINI in the MINI Pavillion at Lenbachplatz. Over half a million visitors were counted at the last IAA 2023 in Munich.

In case of queries, please contact:

Corporate Communications

Julian Kisch, Press Spokesperson, Product Communications MINI
Phone: +49-151-601-38072
E-mail: julian.kisch@mini.com

Micaela Sandstede, Head of Communications MINI
Phone: +49-176-601-61611
E-mail: micaela.sandstede@bmw.de

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SLIDE 2: BMW Group Half-Year Report to 30 June

Good morning,

Ladies and Gentlemen,

After the first six months of the year, the BMW Group remains on track to meet its full-year targets for 2025.

As expected, tariffs weighed significantly on financials in the second quarter.

Nevertheless, the BMW Group achieved Group earnings before tax of over 5.7 billion euros and a Group EBT Margin of 8.5 percent in the first six months.

SLIDE 3: BMW Group Performance in Q2 2025

In the second quarter, deliveries to customers at Group level increased by 0.4 percent year-on-year.

As of June, BMW Group global sales remained on par with last year.

All-electric vehicles made an important contribution with a share of total sales of 18.3 percent.

The share of electrified vehicles – meaning either a BEV or a plug-in hybrid – even amounted to 26.4 percent.

Group earnings before tax totaled over 2.6 billion euros in the second quarter and over 5.7 billion euros after 6 months.

This resulted in a Group EBT margin of 7.7 percent in Q2 and 8.5 percent in the first half-year.

The operating profit in the Automotive segment reached 1.6 billion euros in Q2 and over 3.6 billion euros after 6 months.

This led to an Automotive EBIT margin of 5.4 percent for the second quarter and 6.2 percent for the year to the end of June – both within our full-year guidance of 5 to 7 percent.

Excluding the depreciation resulting from the purchase price allocation of BBA, the margins came in at 6.5 percent for the second quarter and 7.3 percent through six months.

SLIDE 4: Automotive Retail Units, BEV Units, Auto Revenue and Auto EBIT

Let’s take a look at how the Automotive Segment performed across key metrics.

Between April and June, deliveries of BMW, MINI and Rolls-Royce vehicles to customers were on previous year’s level with 621,000 units.

We saw sales growth in all regions except China.

The BMW brand declined slightly by 2.6 percent compared to the second quarter of 2024.

Outside of China the brand grew by 4.7 percent.

MINI benefitted from the full availability of the entire model range and reported a significant year-on-year growth of 33.2 percent in the second quarter across all regions.

Retail sales in Q2 were especially strong in Europe, with double-digit growth of 10.2 percent year-on-year.

The European order intake for BMW remains strong, with an order bank reaching well into the fourth quarter.

The US reported a growth of 1.4 percent in Q2.

In China, retail sales levels in the first six months of 2025 were down 15.5 percent compared to the previous year.

However, during the second quarter we saw a slight sequential improvement month by month.

Sales of our all-electric vehicles continued to grow.

In the second quarter, we delivered more than 111,000 all-electric vehicles to customers.

Automotive segment revenues decreased moderately by 8.4 percent to 29.4 billion euros in the second quarter.

Adjusted for currency translation effects, the decrease was 5.3 percent, mainly due to lower sales volume in China.

Segment EBIT for the period from April to June totaled 1.6 billion euros.

The EBIT margin came in at 5.4 percent for the quarter and 6.2 percent for the half-year.

These margins include the negative effects from tariffs, which amounted to around 2 percentage points in the second quarter and around 1.5 percentage points in the first six months.

That brings me to my next slide, to take a detailed look at the year-on-year changes in the operational result.

SLIDE 5: Automotive Segment EBIT in Q2

Automotive EBIT declined by around 1.1 billion euros compared to the second quarter of 2024.

More than half of this difference is due to the impact of tariffs, which is included in the position Other.

Changes in currency and raw material positions were neutral in Q2.

In the second half year, we expect a headwind year-on-year.

The net balance of volume, model mix and pricing effects negatively impacted EBIT by 300 million euros in the second quarter, compared to the previous year.

Volume and model mix combined were neutral.

Pricing continues to be a headwind year-on-year, however to a much lesser extent than in the first quarter.

Competitive pressure remains strong, especially in the Chinese market. Here, price levels of the second half of 2024 continued into the first half-year of 2025, as expected.

Research and development expenses decreased by about 200 million euros compared to the prior-year quarter.

Group R&D expenditure as of June totaled 4 billion euros, slightly below previous year.

The R&D ratio according to the German Commercial Code came in at 6 percent after six months.

For the full year, R&D expenditure will be below last year’s level, and it will steadily decrease over the next years.

Selling and administrative expenses also decreased by around 100 million euros compared to the previous year.

The year-on-year headwind of 1.1 billion euros from Other Cost Changes can mainly be attributed to two factors:

• First, higher tariffs in the US and anti-subsidy tariffs imposed by the EU Commission on electrified vehicles from China
• And second, the sale of end-of-lease vehicles. Here, resale income was lower than in the second quarter of 2024, yet remains positive on a portfolio basis

SLIDE 6: Automotive Segment Free Cash Flow in Q2

Free cash flow in the Automotive Segment totaled about 1.9 billion euros in the second quarter.

Segment EBT amounted to 1.6 billion euros, which is 1 billion euros lower than in the previous year’s quarter.

The net change in working capital reduced free cashflow by around 300 million euros.

The net effect from capital expenditure and depreciation had an impact of 200 million euros in the second quarter.

Capital expenditure for the first half-year amounted to around 2.7 billion euros, a significant year-on-year reduction of around 700 million euros.

The capex ratio was 4.5 percent for the second quarter and 4 percent for the first six months.

After the peak in 2024, capex will decrease for the full year 2025.

We expect a capex ratio below 6 percent for 2025.

Changes to provisions negatively impacted free cash flow in the second quarter by around 200 million euros. This was mainly due to the consumption of warranty provisions.

The change in the position Other of around 1 billion euros reflects the development of a set of various topics, including accrued expenses, interest and advance payments received, income taxes and liabilities for tariff expenses not yet paid out.

After the first six months, Automotive Segment free cash flow is on previous year’s level with just over 2.3 billion euros.

For the full year, we are targeting a free cash flow of over 5 billion euros.

Our strong free cash flow generation enables us to further execute our consistent shareholder return strategy.

In May of this year, the Annual General Meeting authorized the Board of Management to buy back up to 10 percent of BMW AG's share capital over the next five years.

Based on this authorization, a third share repurchase program with a volume of up to 2 billion euros was approved.

It should be completed by April 30, 2027, at the latest.

The first tranche of 750 million euros began in May and will be completed no later than December 8th of this year.

SLIDE 7: Financial Services Segment in H1

Let’s move on to the Financial Services Segment.

The number of new contracts, concluded with retail customers in the first half year, reached almost 825,000 contracts, a slight decrease of 3 percent year-on-year.

This is due to the challenging situation on the Chinese market, which led to a moderate decrease in new credit financing business.

The new leasing business continued its dynamic growth in the first six months of the year.

The penetration rate for lease and loan offerings increased by 2.5 percentage points to 43.7 percent.

Driven by a higher average financing amount per contract, new business volume was on previous year’s level despite the slight decrease in new contracts.

Segment earnings amounted to just under 1.2 billion euros, a year-on-year decrease of 19.5 percent.

This results mainly from two topics:

• An addition to provisions following the receipt of a revised operational tax assessment for prior years.
• And the resale income of end-of-lease vehicles, which was lower than in the second quarter of 2024, yet remains positive on a portfolio basis

The credit loss ratio across the entire loan portfolio remained at a low rate of 0.27 percent.

SLIDE 8: Motorcycles Segment in Q2

In the Motorcycles Segment, deliveries decreased moderately by 8 percent year-on-year.

Segment revenues decreased by 2.8 percent.

Adjusted for currency translation effects, they were on par with the second quarter of 2024.

Segment EBIT in the second quarter totaled 136 million euros, with an EBIT margin of 14.2 percent.

SLIDE 9: Outlook 2025

Ladies and Gentlemen,

Our outlook for the full year is based on assumptions, which are described in detail in our half-year report.

Let me briefly mention some key factors for our business development in 2025.

In China, we have been observing increased monitoring of the automotive market by local regulatory authorities since the last two weeks of June.

This also affects commission payments from local banks to dealerships in connection with brokering retail financial and insurance products, payment terms to the supplier base as well as increased scrutiny of price competition.

Dealer commissions were significantly reduced by local banks in June.

We are closely following these developments and their potential impact on the Chinese automotive market.

Ladies and Gentlemen,

As you recall, our guidance given in March included all tariffs in force as of March 12th.

In our quarterly statement for Q1, we had assessed and included all tariff increases announced as of May 7th and confirmed our original guidance based on certain assumptions.

And in today’s half-year report, we maintain our consistent approach and have also incorporated the effects of all latest announcements.

According to the announcements on July 27th, an agreement between the US and the EU regarding the tariff situation is emerging.

Based on published information by the respective authorities, we expect partial reductions of the currently applicable tariffs between the US and the EU from August 1st.

Additionally, tariff negotiations across the globe are ongoing and may result in further changes.

Therefore, the expected impact from tariffs on our full-year results can still only be estimated based on certain assumptions.

For the full year 2025, we currently expect a burden from tariffs of around 1.25 percentage points on the EBIT margin in the Automotive segment, including mitigations.

Based on our assumptions, the full-year outlook remains unchanged.

On a Group level, we are targeting earnings before tax at previous year’s level.

In the Automotive segment, we expect a slight increase in deliveries and an EBIT margin in a corridor between 5 and 7 percent.

The EBIT margin in the Motorcycles Segment should come in at between 5.5 and 7.5 percent.

In the Financial Services Segment, we expect a Return on Equity in the range of 13 to 16 percent.

SLIDE 10: Q2 and H2 Profitability within Full-Year Target Corridor

Ladies and Gentlemen,

The BMW Group is a truly differentiated global player.

We set ourselves apart in the automotive industry with our global footprint and our highly flexible operations.

This strong strategic positioning enables us to mitigate the impact of tariffs and allows us to adapt swiftly to changing market conditions.

The BMW Group has a focused strategy and a clear plan how to effectively navigate our operating business.

As a result, we were able to provide a comprehensive guidance for the year 2025 in March, including the impact of tariffs.

And we delivered an EBIT margin within the full year target corridor of 5 to 7 percent both in the second quarter and for half-year.

At the BMW Group, we are steering our business carefully and in a consistent manner.

During the last years, we significantly invested in the future of our company, in line with our long-term planning.

In 2024, both capex and R&D reached peak levels.

Starting in 2025, we are reducing R&D and capex spending, as planned.

Our operating costs are also decreasing compared to prior year. Just as in Q1, this is again evident in our Q2 figures.

Based on the results of the first six months, we once again confirm our full-year targets for 2025.

And we remain committed to our long-term goals

of premium profitability and capital return to create value

for all our stakeholders.

Thank you.

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Ladies and Gentlemen,

Good morning.

Thanks to the strength and foresight of our strategy, our attractive product portfolio and our global team and operations, the BMW Group is built to weather various conditions.

This is what separates us from the competition. And it underscores that there is not ONE automotive industry – major players are currently performing quite differently.

Through the first half-year, our sales performance demonstrates the appeal of our global brands and the ongoing success of our broad technological approach.

After confirming our original guidance from our Annual Conference after the first quarter results, we remain on track with our financial targets for the year – despite ongoing tariff uncertainty and fluctuations in the Chinese market.

Unpredictability is a longstanding feature of the auto industry and is the norm in today’s business environment. What is decisive is how you deal with it. Because global success is rather predicated on your ability to anticipate developments and to respond rationally and efficiently.

That is fundamental to the BMW Group. And we are building upon our leading position in the industry.

The overall global automotive market is growing. We are always ready to profitably gain market share wherever individual market conditions allow. As dynamics in the industry shift, we know exactly where we are placed with our premium brands and where we can pursue opportunities – maintaining a healthy balance of value and volume.

Over many decades, we have built up a comprehensive and balanced network of sales, production and supply chain operations spanning the major regions. This makes us one of the few truly global players in the industry and our deep roots in global markets offer us many advantages.

First, they allow us to tap into leading-edge developments in the individual markets and understand specific customer needs. Our ties to research universities, our R&D network and IT hubs and our network of local tech partners enable us to leverage key competencies from individual markets for our global products and strategy.

Second, through our extensive footprint in key markets, we remain resilient in the face of geopolitical instability and ever-increasing regulation.

Finally, our strong ties also allow us to engage in direct discussions with key political decision-makers, who value our perspective. Here, it is not just about our individual interests, but rather finding solutions for customers worldwide and driving shared economic prosperity.

The BMW Group welcomes the fundamental agreement between the European Union and the United States to reduce tariffs on both sides of the Atlantic. It’s now important to quickly finalize and implement the agreed measures.

We will continue to advocate for trade between the EU and the US not be hindered by import tariffs. The currently agreed US tariffs also burden European exports, affecting consumers and globally operating companies. Therefore, we urge both sides to continue working towards market openness and the convergence of technical regulations.

Through our global production network and supply chains, we maintain high flexibility to respond to fluctuations. Our production plants are attuned to market demand, allowing us to achieve capacity utilization above the industry standards.

At our largest single plant in Spartanburg in the United States, for example, we produce over 400,000 vehicles annually. Over half of which serve the local market and half of which we export. Across the United States we have created extensive value chains as well as a competency hub for our global X Family of vehicles in Spartanburg, which remain in high demand across the entire globe.

BMW made in America and sold to the world.

This combination of leveraging the competitive advantage of the US market in SUVs with BMW’s brand strength allows us to develop products which speak to customers’ needs in markets worldwide.

For the current financial year, our sales results continued into Q2 in line with our expectations, as conditions continue to vary from market to market. In Q2, we saw a sequential improvement from Q1.

Outside of China, all three of our major sales regions posted growth.

Group sales in these markets combined to grow by 6.3% through the first six months of the year.

Group sales in Europe grew overall by 10.2% in the second quarter and in Germany alone by over 10%, with growth in most markets outpacing the passenger vehicle market. Overall, the BMW brand increased its market share in Europe.

Among the most successful BMW models were those in the business class segment. In the first half of the year, the BMW 5 Series saw growth of more than 40% worldwide compared to 2024.

Other notable models that saw success included the BMW X2 models, which more than doubled sales through June.

With the full availability of the new MINI family, the brand grew in all regions worldwide, including in China. In the first half of the year, more than one in three MINIs sold was a BEV.

Rolls-Royce increased deliveries by nearly 10% in the second quarter, driven by strong sales from the Cullinan Series II*.

Drivetrains and model variants across the portfolio continued to see success in Q2. BMW M sold nearly 106,000 vehicles through June, the best-ever first half-year for the brand.

Sales of plug-in hybrid models from the BMW brand grew by almost 30% in the first six months. Our BEV models continue to be a fundamental pillar of our strategy. In the second quarter, we achieved an important milestone, with the delivery of our 1.5-millionth all-electric vehicle. Across the portfolio, we now offer more than 15 all-electric models.

In Europe, the Group’s BEV share reached 25%. With PHEVs included, the electrified share reached nearly 40%. Across all brands, BMW is the third best-selling BEV brand in Europe.

While we are proud of our position as a leading BEV player, we know that the world is multi-dimensional.

To meet consumer needs, especially in a product as complex and personal as a car, there is no single answer. Our Q2 results show that we can serve multiple preferences simultaneously: BEVs, PHEVs and our M models all achieved growth.

The most effective strategic approach is to use all technologies to reduce CO2 emissions overall. We remain committed to the goals of the Paris Climate Agreement, while advocating for a review of the 2030 and 2035 targets in the EU.

To achieve these goals and create effective CO2 regulations, we must take a comprehensive view across the entire value chain. This would consider all emissions across the entire life cycle and not just tailpipe emissions: from the supply chain to the raw materials used in the car, the production process, the vehicle drive, energy used to power the vehicle, and finally to recycling.

A dependency on a single technology can be damaging to an industry. Putting all your eggs in one basket is just poor asset allocation.

Hydrogen, for example, offers Europe an opportunity to use our expertise and take the lead on an emerging technology that will contribute to our climate goals. And, unlike BEVs, without the need for large amounts of raw materials or battery technology which are not localizable at large scale in Europe.

Beyond drivetrains, there is great potential with alternative fuels. There are more than 250 million vehicles in the EU, which could now immediately contribute to climate protection. But this requires a clear regulatory pathway and targeted investments in the ramp-up of all renewable fuels.

Take HVO100 as an example. While it is already available in markets across Europe, tax schemes and the CO2 fleet targets need to recognize this renewable fueling option to incentivize customer adoption. This would help in scaling an alternative fuel that has a 90% CO2 saving compared to normal fuels and can already be accessed today. For OEMs and customers, this is also a cost-effective way to reduce emissions in the use phase.

For Europe to maintain competitiveness and finance its future, we need to invest not only in new technologies, but also leverage our existing technologies, which can meet customer preferences and still contribute to climate targets.

For the BMW Group, we are now just five weeks away from the next major innovation step, which our entire company has been fully focused on for many years now: the launch of the NEUE KLASSE.

On September 5th, we will celebrate the world premiere of the all-new BMW iX3* at the IAA Mobility here in Munich.

In June we hosted media representatives at the pre-drive event in Miramas in southern France. The initial feedback has been tremendous.

We remain right on time with the launch, including at our new Plant in Debrecen. Construction also continues at our battery assembly facility in Irlbach-Straßkirchen.

With the NEUE KLASSE, we are making great strides in all relevant technology fields – whether in electrification, digital user experience, driving dynamics or sustainability.

The new BMW iX3 will be benchmark in the industry.

The all-electric 6th generation powertrain will set standards in performance and efficiency:

• powered by our battery cells developed in house, with 20% more energy density:
• an electric range of up to 800 kilometers according to WLTP;
• With 400-kilowatt maximum charging, customers will be able add over 350 kilometers to their vehicle’s range in just 10 minutes according to WLTP;
• And with an energy consumption of 15 kilowatt hours per 100 kilometers.

In addition, our revolutionary new iDrive will change the way the driver interacts with the car. With the BMW iDrive, we set an industry standard more than twenty years ago. After the reveal of the all-new Panoramic iDrive at CES in January, we are already seeing the industry follow our lead.

With the technology clusters we have developed for the NEUE KLASSE, we will scale our advanced technologies across the portfolio. We will start in the core segment to build momentum quickly. This is simply smart economics.

By 2027, we will bring 40 new models and model updates with NEUE KLASSE technology and design language on the road worldwide.

Our technology cluster approach also allows us to integrate market-specific features and content. In our major sales regions, we have a variety of local solutions with leading partners. This allows us, for example, to further enhance the digital user experience as well as automated driving functions in our upcoming NEUE KLASSE models.

In China, we are collaborating with Alibaba Banma to develop the next level of intuitive and conversational in-car voice interaction. We will also enhance our BMW Intelligent Personal Assistant with functionality from DeepSeek in our vehicles in China.

In most other countries, the next-gen BMW intelligent personal assistant will be powered by large language model technology from Amazon Alexa.

For driving assistance systems that meet local needs and regulations, we have also sought out partners in different geographies. Always following our philosophy in this area: smart, symbiotic and safe.

Just two weeks ago, we announced a new partnership with Momenta, a leading Chinese ADAS technology provider. The partnership will focus on software development and integration for Chinese road-networks, traffic-conditions and user expectations, utilizing advanced AI algorithms and data driven development methods. We will launch the systems in China starting with our NEUE KLASSE.

In other markets, we continue to build on our already very successful partnership with Qualcomm.

These examples show how adaptive the NEUE KLASSE architecture is.

With a software-defined vehicle, we maintain competency over all systems of the car and can roll them out to markets at the same time across the world. But we also are able to quickly integrate local tech stacks into our own ecosystem to give consumers access to innovations and features they are used to.

And through backward integration of software solutions available for all aspects of the vehicle over the air, we will continuously enhance the customer experience.

This is a huge advantage for us.

Ladies and Gentlemen,

Our consistent strategic approach and continued success is not a coincidence but the result of resolute, long-term planning and orientation. It is a multi-year process in every area of the company.

This is what our stakeholders expect from us.

The BMW brand is a promise. And we deliver on our promises.

We continue to build upon the strong position we are in today.

With the rollout of NEUE KLASSE technologies and products over the next two years, we will bring the company to a whole new level.

Thank you.

Small cars have always been a tough sell in the United States, where they’re typically seen as bare-bones transportation for those on a limited budget rather than as a space-saving, fuel-efficient choice for those who simply prefer a smaller, lighter vehicle. In 2002, the BMW Group upended that notion with the MINI Cooper, a car that was not only small and efficient but fun to drive, premium, and—above all—quirky. The MINI Cooper became a surprise hit in this market, and those who bought it became not just customers but a community. 

Neither of those results could have been predicted when BMW acquired MINI in 1994, as part of its purchase of UK consortium, the Rover Group. Mini—originally in lower case—was one of a slew of British brands included in the deal along with Land Rover, Triumph, MG, Riley, and Wolseley. The sale also included outdated industrial plants, substandard product quality, and labor unrest—problems so intractable that BMW would sell off most of the Rover Group’s assets just six years later.
Though Mini was plagued by some of the same problems faced by the Rover Group overall, it was retained as an essential component of the multi-brand strategy in which the core BMW brand was bracketed by Mini and Rolls-Royce, purchased separately. Rolls would allow BMW to target customers for whom even a 7 or 8 Series wasn’t exclusive enough, while Mini would allow the company to build small cars with the front-wheel drive that was anathema to BMW in that era. 

To distinguish the modern MINI from its antecedent, BMW rendered the name in all-caps. BMW then built what amounted to an all-new plant inside the existing exterior walls of the circa 1912 Morris Motors plant in Cowley, near Oxford, England. Equally important, BMW designed an all-new MINI to replace the classic Mini, which had been introduced in 1959 and updated only incrementally in the decades that followed.

The classic Mini was a ’60s style icon, endowed by Sir Alec Issigonis—coincidentally, the great-uncle of BMW’s then-chairman Bernd Pischetsrieder—with a cheerful demeanor that made it a favorite of musicians, actors, and anyone else aspiring to hip style in Swinging London. The car was a sporting legend, too, having won the Monte Carlo Rally in 1964, ’65, and ’67. (It should have won in 1966, as well, but was disqualified for the color of its headlamps.)
That victory inspired Adrian van Hooydonk—then a young designer at BMW Designworks/USA—to sketch a car he dubbed the Anniversary Concept Vehicle (ACV) 30 in 1997. The sketch impressed BMW design chief Chris Bangle, who approved the creation of a running prototype. With distinctive fender creases and stunning red paint with white stripes, the ACV30 was described by Bimmer magazine’s Jay Jones as “pure adrenaline in a small package.”
Van Hooydonk’s concept didn’t make it into production, and neither did an economy-focused concept from the Rover Group. Instead, BMW opted for a design by Frank Stephenson based on a theoretical evolution of the Mini over three decades.
Under the skin, the MINI got modern mechanicals designed via a rather complicated collaboration between Rover engineers and those at BMW. The car got BMW’s signature MacPherson strut front and multilink rear axles, along with state-of-the-art electronics—including Cornering Brake Control, Dynamic Stability Control, and Electronic Brake Distribution—shared with the latest BMWs. For motive power, the MINI Cooper used a transverse-mounted four-cylinder engine built in Brazil, at a plant owned jointly by BMW and Chrysler.
The new MINI made its first huge splash in Paris, and it didn’t disappoint those who drove it at the international press launch. Writing for Bimmer magazine’s October 2001 issue, Ian Kuah said the new MINI “redefines handling and ride in small cars, bringing unprecedented mechanical refinement to the supermini class. It’s also chic, well-built, good value for money, and downright desirable.”

At the time, the MINI hadn’t been announced for the U.S. Behind the scenes, however, a small group of employees at BMW of North America had spent the previous six years setting the stage for its arrival.

When the MINI was first mooted, BMW of North America was led by President Victor Doolan, a native of Great Britain. Doolan had always liked the original Mini, and he knew that U.S. sales volumes would be crucial to the MINI’s success worldwide. “The problem was the cost of the vehicle, which made it too expensive to be a viable project in the U.S.,” Doolan said.
To overcome that obstacle, BMW NA optimized the wholesale-retail relationship, allowing MINI dealers to share back-end services and administration with their BMW franchises while selling MINI from dedicated showrooms. To further enhance profitability, the BMW NA’s product planners—namely Rich Brekus and Bert Holland—pursued a premium strategy in which the base MINI offered in the U.S. would not be the 89-horsepower MINI One but the 113-horsepower MINI Cooper. Above that, the 168-horsepower MINI Cooper S and 197-horsepower MINI John Cooper Works would complete the lineup.

That strategy was approved by BMW NA’s then-CEO Helmut Panke, but it came into doubt in February 1996, when Panke left Woodcliff Lake for Munich and a seat on the BMW AG Board of Management. Panke’s replacement as BMW NA CEO, Dr. Heinrich Heitmann, insisted that MINI would never work in the U.S.

Nonetheless, Heitmann supported the investigations then underway, while other key players within BMW of North America remained committed to MINI. That group included Stefan Krause, then CEO of BMW Financial Services. Krause assigned Rich Steinberg—one of the prime architects of BMW NA’s captive leasing program and a longtime enthusiast of British cars—to research the financial aspects of bringing MINI to the US.

As the policy differences between Panke and Heitmann demonstrated, changes in company leadership can lead to abrupt shifts in strategy, particularly when they occur on the board level in Munich. That’s exactly what happened in February 1999, when fallout from the disastrous Rover acquisition saw Pischetsrieder ousted from the chairmanship. When the supervisory board chose to name Joachim Milberg chairman rather than R&D chief Dr. Wolfgang Reitzle—the second time Reitzle had been passed over for the chairmanship—Reitzle left BMW for Ford. Two months later, BMW NA experienced a similar upheaval: Doolan resigned as President to join Reitzle at Ford, while CEO Heitmann left Woodcliff Lake for Munich and a seat on the BMW board.
On May 1, 1999, Tom Purves arrived at BMW NA as a replacement for both Doolan and Heitmann, taking the newly consolidated position of Chairman and CEO of BMW (US) Holding Corp. A native of Scotland, Purves had been in charge of sales at Rover while the new MINI was under development, and he was eager to bring MINI to the U.S.
In December 1999, MINI USA became a corporate division of BMW NA, with Steinberg tapped as its first employee. Alongside Steinberg, Andrew Cutler would handle communications for the new brand. “In both the pre- and post-launch stages, we relied heavily on PR, with media activations that helped get buzz around the brand even though we didn’t have a big marketing budget,” Cutler said.

MINI now had official status within BMW NA, but bringing a premium hatchback to the U.S. remained a risky proposition. Full-size SUVs were ascendant, and the unmet sales expectations for the 318ti hatchback were still fresh in BMW NA’s institutional memory.
Even so, BMW NA needed MINI to succeed: The car would return better fuel economy with lower emissions than the larger BMW-badged models, reducing BMW NA’s Corporate Average Fleet Economy (CAFE) rating and helping the company avoid fines like the record $28 million it paid in 2001.
“On a worldwide basis, we have to be involved with building more cars with smaller engines in order to comply with legislation,” Purves said. “We also know that we have to keep in touch with younger customers, who one day will be 7 Series customers. The MINI does all of those things for us.”
Since those younger customers tended to live in cities, Steinberg’s team focused on urban areas when soliciting some 70 MINI dealers from BMW’s 350 or so dealerships nationwide. “Our colleagues from overseas put together a traveling roadshow, which included two classic Minis and a PowerPoint presentation,” Steinberg said. “We went to all four regions and told the BMW dealers what the franchise was about, what the car would look like, the kind of investment we were looking for, with a stand-alone selling environment and corporate ID. We invited proposals, which we evaluated to make sure that the MINI brand values would be properly represented.” 

As MINI USA was putting together its dealer network, the division got a new leader when Purves appointed Jack Pitney to the position in January 2001. Pitney was certain the MINI could succeed in this market, and he’d developed his own launch plan for the brand while serving as BMW NA’s Head of Corporate Communications. 
“Jack had been a PR guy, and he was really good at it,” Steinberg said. “He managed media communications better than I could, and he also managed dealer relations and internal relations, which were definitely needed. He was the right guy at the right time.”
Shortly thereafter, MINI USA completed the long search for an ad agency, naming the Miami-based firm Crispin Porter & Bogusky its agency of record on February 13, 2001.
“Crispin had been unknown to me, and unknown to most of America, for that matter,” Steinberg said. “Crispin completely blew our doors off. They pitched us with the ‘Let’s Motor’ tagline, and The Book of Motoring, which basically explained what the brand represented. It was so easy for us to move forward with them, even though they’d never had a car account before.”
CP&B had plenty of work to do prior to the car’s on-sale date in March 2002. BMW NA’s preliminary market research had shown that only two percent of potential U.S. customers had even heard of the old Mini, much less BMW’s new MINI.
On a modest $25 million budget, CP&B worked with Kerri Martin, MINI USA’s Senior Director of Marketing, to introduce MINI to the American public. CP&B’s ad campaign avoided television in favor of print, emphasizing removable “tear-away” magazine inserts that could be shared among potential customers. The agency placed billboards in urban areas, with slogans like “The SUV Backlash Starts Now” reinforced by a MINI mounted on the roof of an SUV and driven on city streets to emphasize the vehicles’ contrasting dimensions.
CP&B’s print ads—placed in general-interest magazines like The New Yorker, Rolling Stone, and The Atlantic more frequently than in automotive magazines—emphasized an entirely different set of virtues than BMW’s usual power and performance. “LET’S SIP, NOT GUZZLE,” read one ad. “Let’s leave the off-road vehicles off road. Let’s stop pretending we live in the jungle. Let’s stop intimidating each other. Let’s not use the size of our vehicle to compensate for other shortcomings. Let’s reclaim our garage space. Let’s be nimble. Let’s be quick. Let’s be honest. LET’S MOTOR.™”
The campaign was wildly successful. “By the time the MINI made its debut in March 2002, more than 50,000 people had logged onto its website, miniusa.com, to express interest in buying one. By the end of the year, brand recognition in the United States had risen to 53 percent,” reported The New York Times. “Sales of the MINI reached 30,000 in the first year, about 10,000 more than the company had anticipated, defying conventional wisdom that consumers would not pay a premium price for a tiny car.”
MINI’s actual sales total was 24,590 in 2002, followed by 36,010 in 2003, MINI’s first full year on the U.S. market. Both figures could have been higher: With the Oxford plant still ramping up, many customers had to wait months for their cars to be delivered. (The vast majority were—and remain—ordered to the individual customer’s taste where color, upholstery, wheels, and other accessories were concerned.) Rather than bemoan the delays, MINI created a sense of excitement around them.
“We started a campaign called ‘Make Waiting Fun,’ in which customers who ordered a MINI could track its journey from the production line, to the boat, to the port, and to the dealership,” Steinberg said. “A lot of companies do it now, but we pioneered it.”

Once they got their cars, MINI owners joined an enthusiastic community of like-minded individuals, one that recalled that of BMW 2002 owners in the late 1960s. This, too, was part of the award-winning marketing plan created by CP&B and Martin.

“The Book of Motoring had rules like, ‘MINI customers need to wave to other MINI drivers.’ It created this community that we’re so fortunate to have, in which MINI is not just transportation but part of their lives,” said Patrick McKenna, who became MINI’s Head of Product Planning and Consumer Events in 2008.
CP&B’s ads encouraged MINI owners to explore the country’s vast open spaces. “LET’S SEND GREETINGS FROM MILE MARKER 73. Let’s lose radio reception. Let’s make it on fumes. Let’s hold it until the rest stop. Let’s beat our postcards home. LET’S MOTOR.™”
MINI owners took that message to heart: In 2006, some 4,000 MINI drivers joined the first-ever MINI Takes the States, a 17-day cross-country journey from New York to San Francisco. The event evolved out of a challenge faced by Jim McDowell shortly after he took over as head of MINI USA in 2005, following a job swap in which Pitney became Vice-President of Marketing for BMW NA. 

“Munich had committed us to sell 200 identical MINI John Cooper Works GPs,” McDowell said. “What is a brand based on individualization going to do with 200 identical cars, and at a higher price? Maybe we could get each dealer to take one car. Okay, that’s 70. What will we do with the other 130? We could have an American Tourist delivery program, maybe at Laguna Seca. But what about people on the East Coast? Maybe we could do the same thing at Lime Rock. That’s where MINI Takes the States came from.” 
As McDowell and Pitney were swapping jobs, Crispin Porter & Bogusky resigned the MINI account to pursue Volkswagen. For McDowell, CP&B’s departure presented an opportunity. “We wanted to be able to move into new directions,” McDowell said. “We weren’t going to be able to advertise on billboards forever.”
After a brief search, the contract was awarded to Sausalito, California agency Butler, Shine, Stern and Partners. The firm redesigned MINI’s brand image and expanded MINI’s experiential marketing with “Motortober” events in dealerships over Halloween. For the third Motortober, rock band KISS helped raise money for disaster relief through the sale of co-branded MINI-KISS merchandise.
In 2009, BMW chose MINI for its first foray into electric mobility. The car’s size was similar to that of the forthcoming i3 city car, and MINI drivers were eager to help BMW develop a battery-electric powertrain. “The MINI e was exhilarating in terms of performance,” McDowell said, “but it was absolutely miserable on cold days. If you used the heat, you had a very short range. You had to pick between heating and getting home!”

McDowell retired at the end of 2013, the year MINI sales hit a record 66,502 cars. He was succeeded in turn by David Duncan (who’d set up the original MINI dealer network with Steinberg), Thomas Felbmair, and now Michael Peyton, who’s run the division since 2019. Over the ensuing decade, MINI sales have ebbed and flowed with gas prices and customer preferences.
The model lineup has expanded and contracted over the ensuing years, as have the dimensions of each MINI. The portfolio has been rebalanced under Peyton’s direction, with 11 models variants in four body configurations – a two-door, four-door, convertible, and compact SUV—available with internal-combustion or battery-electric powertrains.

MINI USA remains a small but enthusiastic team within BMW NA, giving each member opportunities for creativity and flexibility.  “We had six people running an entire marketing department for the whole U.S.,” said Tom Salkowsky, who joined MINI as Head of Marketing Communications in 2010. “Everybody’s doing two or three jobs, and we’re going to get it done. I think back to an infamous Jack Pitney quote, ‘There’s nothing we can’t solve with a few beers and a couple of pizzas in the conference room.’ That exuberance permeated the company.”

It still does. More than 20 years after its introduction to the U.S., MINI remains “a small, fun-to-drive car with a big heart” as Peyton describes it. MINI USA continues to host customer-focused events like MINI Takes the States, and to collaborate with hip, design-based organizations like Pantone, for which it wrapped a MINI Cooper Convertible in 2025’s Color of the Year, Mocha Mousse.

 
Most importantly, MINI continues to inspire enthusiasts to motor: taking road trips, enjoying the scenery, and coming together as a community of like-minded individuals.

Although invented in France, V8 engines have been indelibly associated with American cars—and American tastes—since 1914, when Cadillac introduced its “L-head” V8. Since then, a V8 engine has been de rigueur for any automaker hoping to sell cars to American customers, lest its automobiles be seen as underpowered, underequipped, or simply unappealing.
BMW is no exception. In 1956, BMW introduced its first V8, the Oldsmobile-inspired M502, in several cars aimed squarely at the US market. When that engine went out of production in 1965, BMW powered its small cars with inline four cylinder engines, its larger and more upscale cars with the company’s signature inline sixes. Unfortunately, the latter engines reached their limitations just as new V8-powered cars from Lexus were taking the US by storm, forcing BMW to counter with its first new V8 in nearly four decades. In 1992, the M60 V8 debuted in Europe with the 530i, 540i, and 740i; two years later, it would arrive in the US powering all three models.
In Garching, BMW’s M division was facing a similar conundrum. Throughout the early 1990s, the M5 and M6 were still powered by a variant of the 277-horsepower M88 inline six that debuted in the 1978 M1. The engine had evolved considerably—in the second-generation E34 M5, the catalyst-equipped, 3.8-liter S38 delivered 340 horsepower—but it had reached its developmental limit. Moreover, its performance was nearly matched by the lighter and smaller S50 (later S52) six that debuted in the 1992 E36 M3.
As the M division began planning the E34 M5’s successor in 1993, it was clear that a new engine concept would be required for the E39 M5. “We had two opportunities: a V8 or a turbocharged six-cylinder,” said Alex Hildebrandt, the E39 M5 Project Leader and Head of Product Management for the M division then led by Karlheinz Kalbfell.

 
It wasn’t easy to choose between the two. “We were at the end of the energy crisis in Europe, and there was some doubt about whether this kind of car would find further demand on the market,” Hildebrandt said. “Kalbfell was eager to play this card of fuel efficiency, which didn’t mean we wouldn’t have powerful engines but that the efficiency of the engines should be outstanding in comparison to the power. There was no way to come to that with a V8, because in the end, eight cylinders have to be fed. We had a lot of discussions about turbocharging, but at the time turbocharging mainly added fuel consumption and power at the upper end of the rev range, rather than torque in the middle.”
While discussions about the M5’s engine configuration were getting underway, BMW of North America was debating whether to continue offering M cars in this market. The US market had absorbed over 50 percent of E28 M5 production, or 1,227 cars, but BMW NA had struggled to sell its costly successor, the E34 M5 with its mechanically complex S38 engine. Ultimately, BMW NA moved just 1,476 E34 M5s, or 13 percent of total production. That scenario—together with limited sales for the even more complex E30 M3—had seen BMW NA reject the E36 M3 as too expensive and too high-maintenance for the US, and to consider abandoning the M cars altogether.
The US market was important to M’s overall viability, however, and Kalbfell was eager to find an alternative powertrain that would allow the E36 M3 to be sold in the US at a more affordable price while better suiting American driving conditions. In August 1993, BMW NA agreed to an engine that sacrificed the “pure” M engine characteristics—high revs and top-end horsepower, resulting in high technical complexity—in favor of an engine with nearly as much torque, significantly lower manufacturing cost, vastly reduced maintenance requirements, and a more affordable retail price. The US-spec E36 M3 began arriving in late 1994, and the response exceeded expectations handily. By the end of 1995, enthusiasts had snapped up 8,515 examples.
That car’s success demonstrated the appetite for M cars among American customers, and it offered a convincing argument for an M5 built along similar lines. Even so, Kalbfell continued to advocate for a six-cylinder engine throughout 1994 and 1995, eager to retain this crucial link to BMW’s heritage. 
“Kalbfell believed that the heart and soul of BMW was the inline six-cylinder, and that’s what he wanted as the image leader for BMW, not a V8,” said Rich Brekus, then Head of Product Planning for BMW NA. “I guess he saw the V8 as an American thing, too large and wasteful, but I don’t think anyone could figure out how to have better performance with a six than what they had with the S38.”
They certainly tried, considering not only a turbocharged inline six but a V6, which would have been a total outlier within the BMW engine universe. “In the end, the company was not prepared to spend the money to develop an engine for only 2-3,000 cars a year,” Hildebrandt said. “So this idea was buried, but we’d lost two years of development, a lot of time.”

Eventually, Kalbfell had to concede that a V8 presented the best technical solution for the M5, and that such an engine would suit the car’s character, too. “We wanted to create a sports car for gentlemen, and the V8 was a natural choice,” Hildebrandt said. “And in the end, it was the only choice to bring the car to market in a reasonable time. We were two years behind a regular development process, and if we had gone even later there would have been no profit in the project.” 
Once the V8 concept was established, Hildebrandt took it to Dr. Wolfgang Reitzle, then Board Member for R&D and Sales, for final approval. “The economic figures were quite on the edge, and we were projecting around 8,000-8,500 units over the rather short lifetime of the model,” Hildebrandt said. “But Reitzle said to his sales executives, ‘Okay, guys, this car is good enough to put 10,000 in the books.’ That was really the point where the E39 M5 finally came to life.”
The compressed timeline already limited the development time available for the V8 engine that had aroused so much discussion; moreover, BMW had no racing V8 on which to base the M5’s powerplant. That forced the M engineers to modify the series-production M62 V8, which had superseded the M60 in 1996 with more displacement, higher torque output, and improved fuel economy.
To turn the M62 into the S62, and to do so quickly, the M division had to set aside one of its most treasured virtues. “M’s philosophy at the time was high-revving engines, which we couldn’t achieve with the V8 concept we had,” Hildebrandt said. “We just said, ‘Okay, for this generation M5 we’ll forget about that, if we find other ways to reach the 400-horsepower level.’”

Under the leadership of engine designer Wolfgang Kreinhöfner, the V8’s redline increased slightly nonetheless, from 5,700 rpm to 6,600—“a level where we felt safe,” Hildebrandt said—while displacement increased from 4.4 to 5.0 liters within a redesigned block with Alusil-plated cylinders. The cylinder heads retained the production M62’s hydraulic valve tappets, marking the debut of this maintenance-reducing feature on an M engine, with revised porting for the flow of gases into the combustion chambers. In true M fashion, the S62’s intake system was equipped with eight throttle bodies, one per cylinder, controlled not by a linkage but by an electronic servomotor that also functioned as a cruise control, top-speed limiter, and idle speed governor. 
Most importantly, the S62 got an upgraded oil system to eliminate oil starvation under hard cornering. “If you did a quick right-hand corner [with the M62], all the oil went to the left cylinder bank,” Hildebrandt said. “The engineers created a torque-controlled oil pressure system to ensure the oil supply to both cylinders, and we also experimented a lot with the oil-control rings on the pistons. We only had half the time to develop the engine, and then two months before the start of production one of the long-term test engines blew up. The team had to work really hard to eliminate the mistake, but in the end we made it. And then we used this engine for the Z8, as well.”
The S62 V8 was mated to the standard 5 Series’ driveline, including the Getrag 420G six-speed manual transmission that was rated for engines producing up to 368 pound-feet of torque: exactly the amount delivered by the S62, along with 400 horsepower. The transmission was followed by a limited-slip differential, which was augmented by Dynamic Stability Control that could be switched off altogether by the driver.
The M5 also got stronger suspension components front and rear, stiffer springs and dampers, and larger brakes than the standard 540i. Those upgrades made the M5 a formidable weapon around the Nürburgring Nordschleife, which it could lap in just eight minutes, 20 seconds with a skilled driver at the wheel. That driver was usually Gerhard Richter, who took over the M division in 1997, when Kalbfell was promoted to lead BMW’s global marketing department. Richter had been Head of BMW M Technical Development since 1994, and he performed final testing of all of BMW M’s automobiles. “There aren’t a lot of race drivers who have as many laps around the Nordschleife as Gerhard Richter,” Hildebrandt said. “He had some strict ideas about what an M car should feel like, including making the suspension as stiff as possible to make the car’s steering and reactions as precise as possible.”
To ensure stability at speed, the E39’s exterior styling (by Joji Nagashima) was given subtle but effective aerodynamic upgrades from Marcus Syring, who also designed the car’s unique 18-inch M Double Spoke wheels. Syring gave the M5 a front spoiler inspired by that on a proposed Z3 coupe race car, which provided downforce as well as increased airflow to the S62 engine; this was matched to a small Gurney flap on the trunk lid.
While the car was under development, Brekus was working to persuade BMW NA President Vic Doolan that a new M5 could succeed in the US. “Doolan was adamant that he didn’t want to repeat the disaster of the E34 M5, but agreeing with Germany on a reasonable price point [$69,500] for the E39 M5 helped convince him, as did the fact that the E39 was a great car even as a non-M,” Brekus said. “I think Carl-Peter Forster deserves a lot of credit for making the E39 platform so good from the ground up.” BMW NA signed on, and the E39 M5 debuted at the Geneva Auto Salon in March 1998. Global production began that October, with production of cars for the US slated to start in September 1999. In the meantime, BMW NA’s product planners worked to define the car’s specifications for this market. “BMW AG offered the US market a wide array of options, which we tried to cull into a more simplified offering for BMW dealers and showroom staff,” said Scott Doniger, who replaced Erik Wensberg as BMW NA’s M Brand Manager shortly after the Geneva show. (After European launch, Hildebrandt left BMW M, too, with Albert Biermann completing the M5’s development for the US.)

All M5s got heated sport seats, an M steering wheel and M instruments, plus features like Xenon headlights and satellite navigation that were optional on other E39s. The M5’s interior was beautifully appointed, with extensive leather in a variety of color combinations, including three two-tone options. Combining those features with superb performance—the M5 could accelerate from zero to 60 mph in just 4.8 seconds—yielded what Doniger called “a superbly balanced and responsive luxury sports car, something new that had never existed before.” 
“It’s one thing to throw a V8 into a four-door sedan and make it go fast in a straight line,” Doniger said. “A heavy front end typically unbalances a sedan, but the M5 didn’t feel like a heavy sedan. The package just worked holistically, with phenomenal handling balance under acceleration or braking, and especially in cornering.”

About two months after the E39 M5 launched in the US, Doniger left BMW NA for other opportunities. He was replaced as M Brand Manager by Tom Salkowsky, who witnessed the M5’s incredible success in the US market. “One of our biggest challenges was allocation: We couldn’t get enough production to meet consumer demand,” Salkowsky said. “One of our best talking points was the six-speed manual gearbox, which was a major differentiator to the Mercedes E55 and Jaguar XJR. The pairing of a manual transmission and near 400 horsepower [394 in US spec] was pure magic, and customers loved that thisM5 was built for enthusiasts, for drivers who were skilled enough to master a manual transmission and nearly 400 horsepower.”
To ensure all M5 buyers had those skills, and to demonstrate the car’s true capabilities, the $69,700 list price of every new M5 included a day at BMW NA’s newly-opened Performance Center in Greer, South Carolina. Driving BMW-owned M5s on the Performance Center’s track, customers could discover their new cars’ capabilities in relative safety.
The E39 M5 arrived in the US shortly after the E36 M3 went out of production following a five-year run of extraordinary success in this market. “The sales momentum was building, the energy and excitement around these dynamic M cars was growing, and it helped the US gain a stronger voice in Munich,” Salkowsky said.
It hadn’t been deliberately designed for the US—indeed, its “American” V8 had come about organically, as the answer to a technical problem rather than a marketing concern—but the E39 M5 seemed tailor-made for the US market. By the time production ceased in June 2003, US enthusiasts had snapped up 9,198 examples—nearly half of the 20,482 E39 M5s built for worldwide consumption.
Even more surprisingly, the M5’s production-based S62 V8 engine made its way to the racetrack. With the six-cylinder S50 no longer competitive, Tom Milner’s engineers adapted the S62 V8 to the Jet Racing E46 M3 for the Grand-Am series. At the 2001 Daytona 24 Hour race, the car ran a competitive fifth in the GT class until an air filter clogged with water. Later, Steve Dinan would build S62-based racing engines for Daytona Prototypes; Chip Ganassi’s BMW-powered Rileys won the Daytona 24 in 2011 and 2013, along with the Grand-Am engine manufacturer championships in both years. 

It was an impressive record for a production-based M engine, and it offered a powerful endorsement for the V8 engine concept that would drive subsequent M5s as well as the E9X M3. Those cars might not have been built if the V8-powered E39 M5 had failed to catch on among US enthusiasts. “Without the V8, we wouldn’t have had a chance to get the US on board,” said Hildebrandt, “and without US volumes the project wouldn’t have been profitable at all.”
Along with the E36 M3, the E39 M5 turned the US into the world’s largest market for M cars worldwide, helping to ensure the M brand’s future within BMW worldwide. Moreover, the V8 engine helped catapult the E39 M5 into a higher echelon of performance, setting the stage for all the M5s that have followed. “The E39 positioned the M5 as a thoroughbred super-sedan, and it created a great foundation on which future M5s—the E60, F10, G30, and now G60—could build upon and elevate,” Salkowsky said. “And overall, it helped BMW M position itself as a brand that blended ultimate performance, innovation, and technology with refinement.” 
                                                   —end—

Woodcliff Lake, NJ – July 17, 2025… BMW of North America in partnership with the Petersen Automotive Museum announced the opening of “The Ultimate Racing Machine. 50 Years of the BMW 3 Series in Motorsports” exhibit in the Phil Hill Legends Room of the museum’s recently reimagined James H. Frank Family Vault.

“For 50 years, the 3 Series has embodied the spirit of competition and innovation that drives the automotive world forward. This exhibit offers visitors a rare look at how BMW’s motorsport DNA has evolved—both on the track and on the street." Said Terry L. Karges, Executive Director, Petersen Automotive Museum.

“We are excited to celebrate 50 years of BMW 3 Series in partnership with the Petersen Automotive Museum with this special exhibit.” Said Thomas Plucinsky, Head of BMW Group Classic USA. “The original BMW 3 Series and now the BMW 3 Series with its ‘fraternal twins’, the 4 Series, are the core of the BMW brand. ‘The Ultimate Racing Machine’ exhibit brings together seven of the most successful and important race cars—one from each generation.” The exhibit traces the evolution of the iconic BMW model line through all seven generations, showcasing its impact on motorsport and the marque’s heritage. The core group of race cars has been combined with three wonderfully preserved street examples of the 3 Series including one of the three remaining V8 powered M3 GTR Straßenversion (homologation street version).

The featured models include:

First Generation (E21)

1978 BMW 320i Group 5

In December 1976, BMW decided to contest the Under 2-Liter Class in the World Championship for Makes and approved the development of the E21 3 Series into a Group 5 specification race car. Just three months later, the BMW Motorsport engineering team had transformed the 3 Series into a lightweight exotic race car with titanium coil springs, magnesium uprights, an all aluminum roll cage and wheel hubs. Everything from the engine and transmission, to the driver seat was repositioned for optimum weight balance, and the steel bodywork was replaced with fiberglass shaped in the wind tunnel. The engine for the E21 320 would be the 340 hp M12/7 four-cylinder based on the production M12 and used in Formula 2. This engine also formed the basis of the turbocharged engine developed by McLaren Engineering in the USA for the 1977 320i Turbo that raced in IMSA.

Championship: 1978 World Championship for Makes 

Prepared by: Team Faltz Essen

Driven by: Dieter Quester, Derek Bell, Hans-Joachim Stuck and others

Results: Class Manufacturer Champion, Class Win at Mugello, Class Win at Watkins Glen

1983 BMW 320i US Version

In 1975, BMW introduced the 320i, the first of a long line of models known as the 3 Series.  The car had an updated version of the strong overhead cam engine used in the 2002 incorporating Bosch fuel injection. The MacPherson strut front suspension, semi-trailing arm rear suspension and front disc brakes were also improved 2002 components.  The new 3 Series featured more interior room, a stiffer chassis and improved ergonomics, all in a stylish body. The 320i was sold through the 1983 model year.  The car on exhibit is a low mileage, unrestored, late US model example.

Second Generation (E30)

1990 BMW M3 Group A DTM

The second generation E30 3 Series came to market in 1982 and was homologated as the ‘M3’ in March 1987 for the popular and growing Group A racing rules. Among the prerequisites for homologation was the production of 2,500 BMW M3s for the street, built within the calendar year. Of those, 45 cars were shipped to BMW Motorsport for conversion to race cars. At the BMW Motorsport workshop in Garching, they were fitted with a welded tubular roll cage that tripled the chassis structural rigidity, the interior was removed and added a lightweight Kevlar racing seat and 110 L fuel cell. The rest of the parts needed for racing were included in a BMW Motorsport racing kit.

The car on exhibit was campaigned by Team Bigazzi in the Deutche Tourenwagen Meisterschaft (DTM) championship for British driver Steve Soper. Then 38 years old, Soper had joined the BMW factory squad in 1989. This chassis was built to the final Evolution specification and saw action in DTM during 1991 and 1992 seasons. It is powered by last evolution of the 2.5 liter S14/3 inline 4-cylinder engine, featuring slide throttles, a carbon fiber intake plenum and a BMW Motorsport electronic engine management. It develops upwards of 374 bhp at 8500 RPM and is mated to a 6-speed transmission.

Championship: 1992 Deutche Tourenwagen Meisterschaft (DTM)

Prepared by: Team Bigazzi

Driven by: Steve Soper

Results: P9 in Championship, Two wins, 13 top ten finishes.

Third Generation (E36)

1996 BMW M3 GT-2

Based on the popular high-performance M3 coupe, this purposeful machine was equipped with race-tuned versions of the 3.2-liter inline 6-cylinder production engine.  Removal of normal road equipment such as air conditioning, audio system, anti-lock braking system, sound insulation, interior etc. reduced vehicle weight to 2,350 pounds contributing to a favorable power-to-weight ratio in their racing class.  Engine power reached a peak of 425 hp; with top speeds ranging up to 175 mph, according to gearing selected for specific racetracks.

The car on exhibit is one of the Team PTG prepared BMW M3 race cars that won both the 1997 and 1998 Drivers’ and Manufacturers’ Championships in SportsCar GT-2 category for production-based cars. This car and its teammates won 17 straight races over these two seasons. PTG Team Principal, Tom Milner named each chassis of the program and this chassis, “Greta”, is the most heavily developed version. It won its class at both the 12 Hours of Sebring in 1998 and the 24 Hours of Daytona in 1997. 

Championship: IMSA GT-2

Prepared by: Team PTG (Prototype Technology Group)

Driven by: Bill Auberlen, Mark “Simo” Simonaitis, Boris Said

Results: 1997, 1998 Driver and Manufacturer Championships GT-2 Class

Class win at the 1997 24 hours of Daytona,

Class wins at both the 1997 and 1998 12 hours of Sebring

1995 BMW M3 LTW

BMW of North America’s product planners have always looked for ways to bring exciting cars to their customers and to create limited-production models aimed squarely at performance enthusiasts. The first of these was the 1995 BMW M3 LTW (Lightweight) conceived as a ready-to-race model for the then-popular showroom-stock IMSA Firehawk series. Built with no radio, no air conditioning and aluminum doors, the M3 LTW was 225 pounds lighter than the regular E36 M3. In keeping with its racing purpose, several parts designed for track use such as a taller rear wing, a BMW Motorsport oil pan and a dual-pickup oil pump were shipped in the trunk. In total 126 example were produced. The car on exhibit is a low mileage, unrestored example.

Fourth Generation (E46)

2001 BMW M3 GTR

The most unique feature of the M3 GTR was its powerplant—the first M3 in the history of the company to feature a V8 engine. Designated “P60”, the 4.0-liter engine was the first engine designed and constructed by BMW Motorsport specifically as a race engine. This unique engine was smaller and weighed 30 pounds less than the inline 6-cylinder of the regular M3, despite adding two cylinders. The engine featured a dry sump for optimal lubrication at high cornering loads. A “flat plane” crankshaft was also utilized, allowing for more efficient exhaust scavenging without the need to have header primaries cross over from one bank to the other enabling optimal flow at high rpms. This combination resulted in a very reliable 444 horsepower at 7500 rpm in race trim. In addition to the BMW Motorsport-developed 4.0-liter V8 power plant, the GTR had such signature features as the two openings in the hood for a radiator ducting system that maximized engine cooling without adding aerodynamic drag, an almost completely smooth underbody, a step-up differential to minimize rear axle angles and a carbon fiber roof panel.

The BMW M3 GTR was a dominant competitor throughout the single season that it contested. Bill Auberlen, Boris Said and Hans J-Stuck capped off the season for Team PTG and BMW North America by winning the 2001 Petit Le Mans finale. As a tribute to a grieving nation and to those who lost their lives on September 11^th, Team PTG owner Tom Milner had created the patriotic “Stars and Stripes” design specifically for this race. As a result of the win and the special livery, this car became a legend for BMW racing fans in America.

Championship: 2001 American Le Mans Series (ALMS)

Prepared by: Team PTG

Driven by: Bill Auberlen, Hans J. Stuck, Boris Said

Results: 2 wins, 4 podiums in 6 races. Win at the 1000km Petit LeMans 2001

2001 BMW M3 GTR Straßenversion

One of three remaining M3 GTR Straßenversion (road version) produced to homologate the racing M3 GTR. The M3 GTR Straßenversion was developed in parallel with the racing program by the special vehicles department of the BMW Regensburg Plant. The road car used a detuned version of the P60 racing engine rated at 350 horsepower at 7,000 rpm – complete with dry-sump lubrication and sharply canted radiator with hood venting. Power was transmitted through a racing style twin-disc clutch to a 6-speed manual gearbox and variable locking M differential.

The M3 GTR featured an extensively stiffened chassis and a very sporty suspension setup. The M3 GTR was dramatically lowered compared to the stock M3, additional bracing was fitted between the firewall and strut towers as well as between the rear shock towers. The extended and redesigned front and rear fascias and the rear wing optimized the aerodynamics of the M3 GTR by reducing lift. 

The M3 GTR road car benefited from extensive weight reduction measures. The roof, rear spoiler, hood vents, front fascia and rear fascia were all constructed of carbon fiber reinforced plastic (CFRP) – just as on the race version. The interior of the GTR was also reworked with an eye on light weight. Leather-covered Recaro racing seats were added, the rear seats were removed, and special M3 GTR sill plates finished off the interior changes.

A total of ten cars were completed before the program was terminated. Seven of those were engineering development cars that were later recycled. Three production level examples were produced, and these survive as part of the BMW Group Classic collection. The road car debuted simultaneously at the Dubai importer and the Road Atlanta paddock during the 2001 Petit Le Mans event. The GTR road cars have been cloaked in mystery and have been part of M3 lore ever since.

Fifth Generation (E92)

2011 BMW M3 GT

Based on the fourth-generation street BMW M3 (E92), the 2011-2012 M3 GT race car was developed by BMW Motorsport for the American Le Mans Series / Intercontinental Le Mans Cup rules and was campaigned as a partnership between BMW of North America, Rahal Letterman Lanigan Racing and BMW Motorsport. In developing the BMW M3 GT, BMW Motorsport engineers produced a high technology car that could win against pure sports cars in the ultra-competitive GT racing class. Results soon spoke for themselves both in ALMS and in the ILMC series in Europe (with almost identical sister cars running under the same race numbers). At the end of the 2011 season, the BMW M3 GT had completely swept the ALMS championships: Driver (Müller/Hand), Team, Manufacturer and the Michelin GreenX efficiency challenge.

The car on exhibit, Chassis #1101, raced as the No. 56 driven by Joey Hand and Dirk Müller for the 2011 and part of the 2012 seasons. It has several podiums to its credit in 2011 and 2012 including two dramatic Sebring 12hr wins in 2011 and 2012.

Championship: 2011-2012 American Le Mans Series (ALMS)

Prepared by: BMW Team RLL

Driven by: Joey Hand, Dirk Müller, Jonathan Summerton

Results: Winner ALMS Driver, Team, Manufacturer and Micheling Green X Championships 2011

Class wins at both 2011 and 2012 12 hours of Sebring

Sixth Generation (F82)

2020 BMW M4 DTM Class 1

The 2020 BMW M4 DTM Class 1 represented the pinnacle of development of the Deutche Tourenwagen Masters formula before the series adopted FIA GT3 type cars in 2021. The 2019-20 Class 1 cars were the most technologically advanced closed roof race cars ever produced. With a carbon fiber chassis and body, a weight of 2,163 lbs and powered by the BMW P48 2-liter TwinPower Turbo 4-Cylinder engine, the BMW M4 DTM could accelerate from 0-62 mph in 2.5 seconds, had a top speed greater than 185 mph and could achieve corner loads up to 3g’s. The Class 1 rules introduced features like Push-to-Pass that temporarily added 30hp and a rear wing with DRS (Drag Reduction System) that could be activated under specific conditions to increase top speed.

The car on exhibit was raced in the 2020 season by BMW Team RMG with Timo Glock as the driver. It is the only BMW DTM Class 1 race car in North America.

Championship: Deutche Tourenwagen Masters (DTM)

Prepared by: BMW Team RMG

Driven by: Timo Glock

Results: 0 Wins, 1 Podium, 18 Races, 15 Top Ten Finishes

Seventh Generation (G82)

2023 BMW M4 GT4

The BMW G82 M4 GT4 makes the third generation of customer race cars built to the FIA GT4 rules. The M4 GT4 is the second step for BMW race car drivers working towards racing in the top level GT3 category. The M4 GT4 achieves its outstanding performance through the newest state of the art technology from pure racing and the production model. The latest generation BMW M 6-cylinder TwinPower turbo engine capable of up to 550 horsepower (allowable power output is regulated by the race series) mated to a 7-speed paddle shifted transmission provides a competitive and very reliable powertrain. Several Motorsport systems such as the limited slip differential and the production model’s 10 stage traction control keep the BMW M4 GT4 planted on the track.

The car on exhibit is one of six being used by the BMW Performance Center West in Thermal, California, for advanced driver training and racing driver coaching.

Championship: Eligible for IMSA Michelin Pilot Challenge, SRO GT America Series

prepared by the BMW Performance Center West

Driven by: N/A

Results: N/A

The Ultimate Racing Machine. 50 Years of BMW 3 Series in Motorsport will run through June 2026. The Petersen Automotive Museum is located at 6060 Wilshire Blvd. Los Angeles, CA and is open daily from 10am – 6pm. General admission tickets are $21, and Vault tickets are an additional charge of $28. Tickets are available at petersen.org/tickets.

                                               # # #                                                        BMW Group in the United States.

BMW of North America, LLC was established 50 years ago to support the sales, marketing and distribution of BMW automobiles in the U.S. BMW Motorrad was brought into the fold in 1980. In 1993 BMW Group Financial Services NA, LLC was founded, and one year later BMW Manufacturing Co., LLC began assembling vehicles in South Carolina. In 2002 and 2003, BMW Group established MINI USA, and Rolls-Royce Motor Cars NA, LLC relaunching two iconic brands and rounding out its product portfolio.

Today, the BMW Group has a nationwide corporate footprint in the U.S. which consists of nearly 30 locations in 12 different states. Beyond the National Sales Company and Financial Services headquarters in Woodcliff Lake, NJ, its manufacturing plant in Spartanburg, South Carolina, and numerous other operational facilities, BMW Group in the U.S. also includes Designworks, a strategic design consultancy in Santa Monica, CA, BMW Group Technology Office USA, a technology research and development center in Silicon Valley, and BMW i Ventures, a venture capital fund, also in Silicon Valley.

BMW Group Plant Spartanburg is the largest single BMW production facility in the world, and the global center of competence for BMW Sports Activity Vehicles including the X3, X4, X5, X6, X7, and XM. The plant assembles more than 1,500 vehicles each day, and up to 450,000 annually. Since 1994, Plant Spartanburg has assembled over 7 million BMW vehicles in the U.S.

The BMW Group sales organization in the U.S. is represented through a network of 350 BMW retailers, 144 BMW motorcycle retailers, 105 MINI passenger car dealers, and 38 Rolls-Royce Motor Car dealers. The company’s activities provide and support over 120,000 jobs across the U.S. and contribute more than 43.3 billion to the U.S. economy annually.

# # #

Journalist note: Information about BMW Group and its products in the USA is available to journalists on-line at www.bmwusanews.com www.miniusanews.com and www.press.bmwna.com

As anyone with a brother or sister knows, the most intense rivalries are always between siblings. Any perceived advantage can stoke deep resentments, while any perceived disadvantage can provide a powerful motivation for one to surpass the other.

In 2001, the sibling rivalry between Munich-based BMW Motorsport and the BMW of North America team fielded by Prototype Technology Group played out on the racetracks of the American Le Mans Series. Fielding the E46 M3 in not-always-equal configurations, the two teams battled not just Porsche but each other for GT-class dominance.

In the second half of the 1990s, dominance was the name of the game for BMW NA in the International Motorsport Association’s GT class. Motorsport manager Erik Wensberg had hired Prototype Technology Group to run BMW NA’s E36 M3 racing cars, and a learning season in 1995 was followed by an incredible win record from 1996 to 1998. Along with winning fully half of all the races contested, the PTG M3 GTs captured the driver’s titles for Pete Halsmer and Bill Auberlen and team/manufacturer’s titles for PTG and BMW of North America.

Despite those accomplishments, PTG got little respect in Munich. “[BMW Motorsport director] Paul Rosche thought we had a hick NASCAR team running our M3 program,” said Rich Brekus, then Head of Product Planning and Strategy at BMW NA. “It was a constant refrain that BMW Motorsport should run it, but I defended [PTG principal] Tom Milner, and Karl-Heinz Kalbfell on the corporate side was supportive.”

In 1999, the E36 M3 was eclipsed by Porsche’s new water-cooled 996, specifically the water-cooled 911 GT3 homologation special and its full-race counterpart, the $270,000 GT3R equipped with a 405-horsepower 3.6-liter engine. The PTG M3s took two early-season wins, but Porsche took six, and the championships. 

BMW needed a new car, but the E46 M3 would share many of its predecessor’s disadvantages against the Porsche; namely, more frontal area and aerodynamic resistance, and a 3.2-liter inline six-cylinder engine that put out just 338 horsepower. The engine’s 0.4-liter displacement deficit was significant, Brekus said, because of IMSA’s limits on intake airflow. “Restrictor racing is a displacement game, because the higher the displacement, the earlier you develop torque, and the faster you can come off a corner.”

In 2000, IMSA became the American Le Mans Series, and the PTG E46 M3 GTs won just one race—at tight and twisty Sears Point, a traditional BMW stronghold—while Porsche took the other eleven.

It was a similarly difficult season for the BMW Motorsport Team Schnitzer V12 LMRs. Having dominated Le Mans and the IMSA prototype class in 1999, the V12 LMRs won just two races in 2000 against nine for the Audi R8. Audi was clearly ascendant, and BMW Motorsport shut down its prototype program at the end of the 2000 season.

By then, BMW was racing in Formula One with Williams, and power was shifting within BMW Motorsport in Munich. Kalbfell was losing influence to Mario Theissen, who’d been named co-director with Gerhard Berger in April 1999, Brekus said, and Theissen had very different ideas about how racing should be run worldwide. “Theissen was very much of the opinion that sales subsidiaries like BMW NA should only market motorsport, not run it,” Brekus said. “I basically said we’re not going to do it that way. We have a great race team, and I don’t like the way you guys run racing. You basically freeze everybody out, and you’re not very good with fans. I still had enough support within BMW that I was able to make that stick, but Theissen didn’t like it at all.”

Having ensured the survival of BMW NA’s own racing program with PTG, Brekus and his team knew they needed “a killer M3,” preferably one with a V8 engine rather than the roadgoing M3’s S54 inline six. The idea of a racing V8 had been hatched a few years earlier, when BMW was contemplating a foray into the Indy Racing League as an engine supplier. BMW Motorsport had tested the concept with a V8-powered Riley & Scott prototype in the 1998 World Sportscar series, but the outsourced P62 engine proved fragile. The car won just one race, in pouring rain that Brekus said prevented the car from making enough traction to break the motor.

BMW abandoned the V8 in favor of the V12 engine in its Le Mans Prototype, but it resurrected the configuration for the E46 M3 that would race the American Le Mans Series in 2001. Finally, the M3 would have enough power to compete with Porsche’s GT3R.

Interestingly, the new P60 V8 was designed by Reinhard Könneker, who’d come to BMW from Porsche. In Weissach, Könneker worked on the 917 and other racing projects under Hans Mezger, who’d designed the engine in the GT3R that constituted the M3’s principal rival in ALMS. At BMW, Könneker worked on Formula One engines; like those V10s, the P60 had a cylinder block and heads cast in aluminum at BMW’s state-of-the-art Landshut foundry. Unlike an F1 engine, the P60 had undersquare bore x stroke dimensions of 94 x 72mm, which emphasized torque rather than high engine speeds to help the M3 accelerate off corners, and to optimize performance with the ALMS-mandated air restrictors in place. So configured, the P60 made some 493 horsepower at 8,000 rpm and 354 pound-feet at 6,500 rpm. Its dimensions were more compact than those of the S54 inline six, too, which allowed BMW Motorsport to lay out the cooling system for optimum efficiency—an important advantage in multi-hour ALMS races.

The P60 was a pure racing engine, and it hadn’t been homologated by the FIA for use in production-based racing. In lieu of that, BMW petitioned the governing Automobile Club de l’Ouest (ACO)—which made the rules for the 24 Hours of Le Mans and the ALMS—to allow its use based on Porsche’s use of a full-race engine in the GT3R. As Peter Brock reported in Bimmer magazine, “The ACO had to agree that BMW was also entitled to use a special engine for its proposed ‘limited production’ GT racer in 2001.” To be fully compliant, BMW was required to create a parts fiche for the car and make all parts available, print a sales brochure, and offer the car for sale on three continents. The ACO’s intention, Brock noted, was to give Porsche some real competition in both the ALMS and the 24 Hours of Le Mans in 2001.

Just as interesting was BMW Motorsport’s decision to give PTG some real competition by fielding its own Team Schnitzer cars in ALMS GT for 2001. “Theissen had agreed to do the V8 M3, but he didn’t think PTG was capable of developing the car and that Schnitzer needed to run it,” Brekus said. “I said, ‘All right, but we’re keeping PTG, and you have to supply the exact same cars to PTG that you supply to Schnitzer.’ They agreed, and so did Albert Biermann, who was responsible for all non-F1 racing.”

The Schnitzer team would have an obvious advantage in being closer to BMW Motorsport than PTG, and despite the assurances given to Brekus it would have an equipment advantage, too, at least initially. For the first four races, only the Team Schnitzer cars would be powered by the P60 V8, while PTG made do with the S54 inline six until the series reached Sears Point for round five in July. Adding to PTG’s potential disadvantage, the team ran on Yokohama tires while Schnitzer used Michelin, which also supplied BMW in Formula One and was considered the dominant force in race tire development.

The P60 V8 wasn’t ready for the first round of the 2001 season at Texas World Speedway on March 4, so the two PTG entries and the sole BMW Motorsport Team Schnitzer car ran with the well-established six-cylinder engine developed by PTG’s Brian Krem (and which Team Schnitzer purchased from PTG for that purpose). The Alex Job Porsches finished 1-2, but PTG’s Hans Stuck and Boris Said took third, with Team Schnitzer car driven by Jörg Müller and JJ Lehto in fifth and the second PTG car of Bill Auberlen and Niclas Jönsson in seventh.

Two weeks later, the 12-hour race at Sebring saw the Alex Job Porsches again finish 1-2, but this time the third step of the podium was occupied by the Team Schnitzer’s Lehto and Müller—now racing with the P60 V8 in what BMW Motorsport considered a test for the new engine. Lehto and Müller might have won but for an eleventh-hour pit stop to change the brakes; they’d been controlling the race since lap four, and they set a GT lap record during the race. The fastest PTG entry of Said, Stuck, and Peter Cunningham, meanwhile, finished six laps behind in fourth, while the other PTG car as well as a second Team Schnitzer M3 DNF’d.

With that, the Team Schnitzer BMWs flew across the Atlantic for two rounds of the European Le Mans Series, for which both cars would be equipped with P60 V8 engines. Following a double DNF at Donington, the Schnitzer cars scored a promising 1-2 finish at Jarama before returning to the US.

At Sears Point on July 22, all four M3 GTRs would be equipped with P60 V8s, setting up a battle royale against theoretically equal teams. “[PTG boss] Tom Milner had a lot to prove, and [Team Schnitzer’s] Charly Lamm had a lot to prove,” Brekus said. “The expectation was that PTG wasn’t the same caliber as Schnitzer, and that Schnitzer would always win.”

Schnitzer did indeed win at Sears Point, beating the top PTG car by a lap. Not far behind, the second PTG car was set to finish third until Hans Stuck was tapped into a spin by Schnitzer driver Frederick Ekblom in the final corner, relegating him to fourth. It was emblematic of the rivalry between the two teams, and their drivers. “You can’t put two roosters in the henhouse,” said PTG driver Bill Auberlen. “All we wanted to do was beat them.”

“Charly was telling [the Schnitzer drivers] to do whatever it takes, and Tom was telling his drivers to do what it takes,” Brekus said. “And if you’re Boris or Hans, you’re going to show these guys. Our drivers tended to be older and more experienced, while the Schnitzer team had younger BMW factory drivers. In endurance racing, a lot of times you win races by knowing how to pick your fights and stay out of trouble, not by being fastest around the track, and Boris and Hans were really good at that.”

The Schnitzer M3’s win had implications that went beyond the BMW pits. Schnitzer driver Dirk Müller had driven the second M3 around Sears Point two seconds faster than he’d lapped the previous season in a Porsche, which set alarm bells ringing in the Porsche garage. Peter Brock reported that Porsche “called in the generals,” meaning its best engineers, for the next race at Portland.

Despite Porsche’s best efforts, and those of Team Schnitzer, PTG’s Stuck and Said won at Portland on August 5. Two weeks later, the Schnitzer team would have its revenge, going 1-2 at Mosport after collisions with both PTG cars. Two more Schnitzer 1-2s would follow at Mid-Ohio and Laguna Seca, raising suspicions that Schnitzer engineers were tampering with the engine management software used by the PTG cars.

“I don’t think so,” Brekus said. “Honestly, a lot of the difference in performance between the two cars was the tires. Yokohama was a fantastic supporter of ours, but for sure the Michelin race tires were better.”

The final showdown was set for October 6, and the 1000km (10 hour) Petit Le Mans race at Road Atlanta. The race was doubly important, as a win would guarantee entry at the 24 Hours of Le Mans the following season.

It nearly didn’t happen. On September 11, terrorists hijacked jetliners to attack the World Trade Center and the Pentagon, and much of normal life came to a halt. After much debate, Petit Le Mans went on as scheduled, but every car was decked out with an American flag sticker to show their support of the host country. Milner went a step further with the Team PTG M3s, replacing the Black/red/white Yokohama livery for a field of blue with white stars on the hood, roof and deck lid that turned the entire car into an American flag.

It was an emotional race for all concerned, but especially for US-based Team PTG and its drivers. The lead PTG car driven by Stuck, Said, and Bill Auberlen had been running neck-and-neck with the Team Schnitzer M3 of Dirk Müller and Jörg Müller throughout the race, but it all fell apart for the Schnitzer car in one of the final pit stops. “The driver is allowed to help the next driver get into the car and get his seat belts fastened, but he can’t work on the car,” Brekus said. “Jörg Müller decided to clean the windshield, so they got a drive-through penalty.”

PTG won by a lap over the nearest Schnitzer car, with the fastest Porsche third and the second Schnitzer M3 in fourth. (The other two PTG entries DNF’d.) “It was unbelievable,” Brekus said. “It was a hard-fought race, and I’ll have to give Charly credit. He was a racer, first and foremost, and he came over and congratulated Tom sincerely. By then, he’d recognized that PTG wasn’t some bunch of buffoons.”

BMW Motorsport Team Schnitzer won the GT championship, ahead of the Alex Job Racing Porsche team and PTG in third. Schnitzer’s Jörg Müller won the driver’s title, with Said the top PTG driver in fifth.

It had been a fantastic season for BMW, and it should have been followed by another fantastic season in 2002. Unfortunately, on November 25, 2001 the ACO issued a ruling declaring the P60 V8 illegal unless BMW built 1,000 examples. That number fell short of the 1,868 911 GT3s built by Porsche from 1999 to 2001, but it was far more than the 163 full-race GT3Rs, and well in excess of the number of roadgoing M3 GTRs that would have been feasible for BMW to build. Like the racing M3 GTR, the roadgoing version had been designed by Albert Biermann, and ten prototypes had been built in anticipation of a limited production run. In accordance with ACO requirements, the roadgoing M3 GTR had been shown at Petit Le Mans, where a price tag of €250,000 was announced.

In the wake of the ACO’s decision, BMW killed the V8-powered M3 GTR road car program, and it withdrew from ALMS racing for 2002. Porsche would go undefeated that year, and every season until 2006, when Risi Ferrari finally won four races and the GT2 championship.

In 2004, BMW brought its racing M3 GTRs out of mothballs, swapped the V8 engines for the original 3.2-liter inline sixes, and promptly won the Grand-Am GT championship. “The cars were then banned by Grand-Am because the chassis was too trick, so they were parked once again for 2005,” said Larry Koch, who ran BMW of North America’s motorsport program in 2005 and 2006 and then again in 2011 and 2012. “In 2006, we returned to the ALMS with the 2001 M3 GTR, this time with a 3.4-liter engine and a weight reduction. They were five years old, but they were fairly competitive, finishing on the podium at Lime Rock but otherwise having a midpack season. It’s kind of funny that the two PTG M3s won championships in ALMS and Grand-Am and were subsequently banned by both series!” 

BMW wouldn’t return to ALMS until 2009, when it campaigned the E92 M3 GT2 with Team Rahal Letterman Lanigan. Like its 2001 M3 GTR counterpart, that car was powered by an all-new P65 4.0-liter V8 engine based on the roadgoing S65 V8. In 2010 and 2011, the E92 M3 GT2 would beat Porsche once again, a decade after the E46 M3 GTR had done the same.

“The M3 GTR was the best-handling GT car ever,” said Auberlen. “The engine was so light, and so small, and the way it put power down was exactly matched to the tire. You were right on the edge of adhesion all the way up the powerband, and it drove away like a rocket.”

It still does. The Petit Le Mans-winning PTG M3 GTR was restored by BMW Classic USA in 2015, and it makes regular appearances at vintage races and charity events throughout the US. Wherever it goes, it reminds spectators of a fantastic ALMS season in 2001, and of PTG’s incredible victory at Petit Le Mans in the wake of 9/11.

It’s hard to imagine in today’s connected environment, but the internet wasn’t always the go-to medium when a carmaker wanted to reach a new audience. In the 20th century, ad campaigns premiered via the long-established triumvirate of radio, print, and television, which had guaranteed audiences and familiar formats. As the 20th century gave way to the 21st, however, the new medium of the internet began to offer enticing possibilities…if marketers were daring enough to try it.

In Jim McDowell, BMW of North America had a Vice-President of Marketing and Product Strategy who was nothing if not daring. McDowell had followed a degree in behavioral psychology with a master’s in public policy at Harvard, then went to work conducting social science research for the RAND corporation. After a stint at Porsche Cars North America, he moved to Stuttgart to become director of marketing for Porsche AG, in both cases working with Minneapolis-based Fallon McElligot as Porsche’s advertising agency of record. In 1993, he was lured to BMW by Helmut Panke—first in Munich and then at BMW NA—and within two years he’d replaced BMW NA’s ineffective agency with Fallon. 

At the time, BMW of North America was still climbing out of a slump that had seen sales fall by nearly half during a dreadful five years—from 96,759 cars in 1986 to just 53,343 in 1991. A performance-oriented product push from BMW NA President Vic Doolan and Product Planning Manager Rich Brekus was helped by Fallon’s effective advertising, and BMW NA sold 105,761 cars in 1996. In the year 2000, sales climbed to 189,423 cars.

BMW was on a roll, but its progress was threatened by a lack of new cars in 2001. “It was such an interesting time in our history, because there was no new product,” said Patrick McKenna, who’d joined BMW NA’s marketing team in 1997. “It was a lull, so we decided to do a brand campaign.”

BMW’s previous ads had always been well-polished, but they promoted individual products rather than the BMW brand as a whole.

“Because our marketing budgets were so small, all we did was launch cars,” McDowell said. “We never had money to run a brand campaign, and we weren’t very good at coming up with ideas for one. Finally, [Marketing Communications Manager] Baba Shetty drafted this document that basically said to Fallon, ‘We want to bring across the essence of the BMW brand, bring across the BMW chromosome.’ They came up with this idea that we could get a really good director to do a 15-minute film.”

BMW NA had already experienced great success with product placement in several James Bond films, starting with 1995’s GoldenEye. That film served as the public debut of the Z3 roadster, and it inspired Fallon to create Bond-themed ads for the car. It also expanded the notion of how a BMW could be used in film, which had previously been subject to strict rules from BMW’s legal department. “They became very cautious after the California lawsuit [regarding BMW’s claim of ‘friction-free motors’ in an ad by the Mullen agency], so they examined every storyboard and proposed ad to ensure there was no speeding, reckless driving, or unsafe driving,” McDowell said. “Every driver had to be photographed with the shoulder harness engaged, even in a non-moving car. Film had to be made at an accurate speed, and all acceleration and braking claims had to be documented. They were stringent, because advertising was an implied promise to potential customers.”

Movies, on the other hand, carried no such promise. They were purely entertainment.

“We had learned from the James Bond films that we could break the rules about allowing the cars to be involved in collisions, driven off parking garages, etc., as long as everyone was safe,” McDowell said. “A lot of destruction was possible in film, which made it really exciting, and you could drive really fast. The lawyers approved the scripts, and there were discussions about anything reckless or unsafe. But the filmmakers were there to tell a story, and BMW couldn’t prevent that. They just wanted to ensure that the car was driven in heroic ways, not evil ways, to foil the bad guys and protect the innocent. The lawyers were still involved, but they measure the films against entertainment standards instead of advertising standards.”

Given that additional latitude, McDowell and his marketing team liked the idea of a 15-minute film, especially once Fallon suggested that the featured BMW be more than a mere prop or accessory. “When we were telling Fallon what we wanted, we told them it needed to be cinematic, it needed to be cool, and that we wanted people to be talking about it at work on a Monday morning,” said Patrick McKenna, who worked intensely with Fallon on the project. “They looked at The French Connection, Le Mans, Ronin, and said, ‘What if we could make the car the star?’ It started with that premise.”

The project would be audacious, not to mention expensive, but McDowell signed off on it immediately, McKenna said. “You could make a television commercial for $1 million, but viewers may or may not pay attention. Whereas we knew that if you came and watched a film we’d have your undivided attention for several minutes.”

It was doubtful that a short promotional film could get enough in-theater exposure to make it cost-effective, so BMW and Fallon decided to release its new campaign—which by then had evolved into not one but a series of short films, dubbed The Hire—on the internet. It was a new, relatively untested medium, but BMW’s research had shown its customers to be early adopters of new technology. So was BMW NA, which had partnered with Apple Computer for the “BMW Cyber Drive” in 1997. By registering at bmwusa.com, participants could take a virtual test drive of a BMW in the Napa Valley wine country, for instance, or explore the other “cool sites and wonders of the world” over the 21-day promotion. “It almost ruined marriages and drove people to drink,” McDowell said. “Getting everything to work right was a problem.”

Four years later, the internet was far more capable, and so were the computers and connections people used to access it. YouTube hadn’t yet been created, so Fallon developed its own video player to deliver the films. “That was well and good, except for the poor soul who had AOL, which took about five to eight hours overnight to download a five-minute film,” McDowell laughed. “But people tried it, and with every film there was more interest.”

Some of that interest was derived from the novelty of watching a film on one’s computer, but far more was generated by the top-flight directors recruited to the project by executive producer David Fincher. [Fincher had already directed Seven, The Game, and Fight Club, and he’d go on to make Zodiac, The Social Network, and The Girl with the Dragon Tattoo, among other features.] “His motivation was to have a feature film in miniature,” McKenna said. “He was instrumental in getting A-list directors involved, including John Frankenheimer, who was 71 years old but had always wanted to work with David Fincher.”

Frankenheimer was legendary in the automotive enthusiast community for Grand Prix as well as the three films cited by Fallon in early discussions about the project. On April 26, 2001, the Frankenheimer-directed “Ambush” became the first of The Hire films available for streaming or download. Like the films that would follow, it starred Clive Owen as The Driver, an unnamed character hired to drive BMWs—in this case the E38 740i in its final year of production—through a variety of precarious situations that allowed for exciting action sequences.

“Ambush” was followed by “Chosen,” directed by Ang Lee fresh from his highly acclaimed work on The Ice Storm and Crouching Tiger, Hidden Dragon. Released on May 10, 2001, it highlighted the E39 540i.

Two weeks later, BMW Films released “The Follow,” directed by Wong Kar-Wai shortly after the release of In The Mood for Love. Unlike the first two films, which featured Owen with little-known actors, this one starred Mickey Rourke, Adriana Lima, and Forest Whitaker, as well as the E46 330Ci and the Z3. The film touched on domestic abuse, a serious subject normally avoided in automotive marketing campaigns.

The Hire was gaining new followers—and more kudos from critics of film and advertising—with each successive release, but neither BMW nor Fallon were prepared for what followed the release of “Star” in June 2001. Directed by Guy Ritchie, previously known for music videos as well as Lock, Stock, and Two Smoking Barrels, “Star” put Owen behind the wheel of an E39 M5 with pop star Madonna as his self-absorbed passenger. The film was hilarious, especially when Owen used the M5’s performance to give Madonna her comeuppance.

“With the Madonna film,” McDowell said, “all heck broke loose. All of a sudden, we were on every program that would interview people. We were in Time magazine. We were everywhere. People went back and started looking at the entire series, which in the meantime had become far more watchable. We had a plan for how we would add servers, but that plan was very inadequate given the level of demand, so we really had to scramble adding servers. But in the end, jillions more people saw this stuff than we ever dreamed.”

Advertisers have complicated metrics by which they measure success, but by all accounts The Hire had achieved its goal. “It was five times as effective in terms of cost per BMW minute than showing an ad during the Super Bowl,” McDowell said. “But the difference was that our cost per BMW minute was per screen, and the Super Bowl was per viewer. To the extent that multiple people watched The Hire on the same screen, that was even better. I’ll never forget: One day I walked into the Condé Nast building for a meeting, and there was absolutely no one on the floor. I turned the corner and found everyone in the lounge, watching The Hire.”

Following “Star,” The Hire concluded its first season with “Powder Keg,” a hard-hitting film about a war photographer played by Stellan Skarsgård, who’s driven away from a firefight in an X5 3.0i. “Powder Keg” was directed by Alejandro González Iñárritu, then little known outside his native Mexico but already well regarded for Amores Perros.

The BMWs were certainly present in each film, but the directors didn’t linger on the roundels, or luxuriate over the car’s features. “Jim said it was like a great Western movie where BMW was simply the horse,” McKenna said. “It’s a big part of the story, but not the entire story.”

Even so, The Hire is credited for helping BMW NA’s annual sales crest the 200,000 mark for the first time in 2001, with 213,127 cars sold—an increase of nine percent over the previous year’s figure. After an additional three films from John Woo, Joe Carnahan, and Tony Scott were released in 2002, BMW’s annual sales reached 232,032 cars.

“BMW Films was an excellent instrument,” McDowell told Bimmer magazine in 2002. “The people who came to BMW Films were bright, curious people who were adept at using technology—exactly the demographic that buys our cars. At least 75 percent of the people who came to the site were prospects, and our goal was to plant the seed of future BMW ownership, to have people who saw the films dream of BMWs and maybe purchase one in five or six years. Having said that, we’ve been very pleasantly surprised by the number of viewers who have immediately purchased vehicles after seeing the films.”

Commercially and creatively, The Hire was an unqualified success, seen by some 100 million viewers and enshrined in the permanent collection of the Museum of Modern Art in New York. It was copied by other automakers, including Nissan and Mercedes-Benz, but none of the imitators had the power of the original.

Within BMW NA’s marketing department, The Hire proved a tough act to follow. “When we went back to conventional advertising, we were finding ourselves needing to push and push to try to get something that breaks through the clutter,” McKenna said. 

Even if that proved difficult, what BMW NA had achieved with The Hire was undeniable. “I think it gave us license to be more daring in all of the content that came later,” McKenna said. “It opened some minds and raised the bar for what’s possible.”

The life cycle of an automobile has three distinct phases. First, it’s new, exciting, and perhaps expensive. A decade later, it’s out of date, with little value or allure unless it survives to the third phase. At this point, the automobile

becomes ‘vintage’, and values rise once again as it becomes a treasured survivor. This is true of many BMW models, and it is especially true of race cars, which lose most of their value the moment they’re no longer competitive.

Racing has always been essential to BMW of North America’s marketing program, and its factory team had a race-winning history in IMSA going back to 1975 and the 3.0 CSL. Its CSLs were turned over to Peter Gregg for the following season, and the subsequent 320i Turbo, M1 IMSA Group 4, and March prototypes—including the M1/C, one of the first cars with ground effects bodywork—were put in storage once their racing days were done.

In 1985, those groundbreaking race cars were on the verge of being destroyed forever when BMW NA’s newly-hired Motorsport Manager Erik Wensberg received some surprising news. “I can recall the very day, because I’d only been with the company for about three months,” said Wensberg. “I was at Lime Rock and was told that our race team, DM Engineering, had a bunch of our stuff gathering dust in a barn next to their shop in Danbury, Connecticut. I had no idea what they were talking about, but I said I’d come up and see.

“I opened the door of this barn, turned on the single light bulb hanging in the middle, and I was stunned. There’s the 320i Turbo with no wheels, sitting on the dirt floor. There’s the March M1/C, on its side. Two M1s, and a bunch of other stuff, wheels and boxes everywhere.”

Wensberg was told that BMW was going to donate the entire lot to a trade school “so that kids could learn to drill and cut. I said, ‘The hell it will! You lock this door and don’t open it until I tell you.’” He returned to Woodcliff Lake and found Hans Riedel, BMW’s Vice-President of Marketing. “I said, ‘Hans, this is a crime. All of our racing DNA is sitting in a pile of dirt in Connecticut, and they’re going to give it all away. We’ve got to restore these cars, bring them out, and show them as elements of pride in our history.’”

Crucially, Wensberg also expanded the collection, trading a spare M1 to Richard Conway in exchange for CSL #2275985—the car driven by Sam Posey and Brian Redman to second place at Riverside in 1975, to second and third with Stuck at the Lime Rock doubleheader, and second with Posey at Mid-Ohio.

All of the cars had been raced hard and put away wet, so to speak, and all were in need of restoration. With no budget for that purpose, Wensberg and Riedel got creative. “Riedel would bring me into every planning meeting where we were talking about a new production car and he’d say, ‘Erik, I think we need a vintage car here! What should we do?’ And I’d say, ‘Well, we could put the CSL there, but I need $45,000 to [have Jack Deren] restore it.’ ‘Okay, give Erik $45,000!’ We restored five or six cars one after another, and displayed them to great acclaim. We did a whole campaign with the enthusiast books, talking about a commitment to performance that dates back decades rather than months.

The 320i Turbo and the March M1/C and GTP (86G) prototypes had raced with turbocharged M12/13 engines that were problematic and expensive to keep running. Although they are all “display-only” now, Erik was able to restore the 320i Turbo and the BMW GTP as running examples. In 1992, they appeared at BMW Motorsport’s 20th-anniversary celebration, organized by Conway at Moroso Raceway in Florida. Four years later, they had a star turn when BMW was the featured marque at the Monterey Historic Races, an even bigger gathering in California.

Wensberg left BMW NA in February 1998, and his replacement was equally keen to maintain and expand the collection. Two years earlier, Larry Koch had helped Wensberg organize BMW’s presence at Monterey, and his first act as Motorsport Manager was to purchase a BMW 2002 race car from Vasek Polak’s shop in Los Angeles, which was being liquidated following Polak’s death. Later, he’d buy both of the E34 M5s campaigned by Ed Arnold Racing, including the one raced by David Donohue to the 1994 IMSA Supercar championship.

“The goal was to promote BMW performance and the M brand, and to show goodwill towards the BMW Car Club of America and various charities,” Koch said. “I added passenger seats to as many race cars as possible so we could provide rides, and I also started running the cars each year at the Monterey Historics, Lime Rock, and other vintage races, with the driver who drove the car when new if possible. We even took the March 86G and CSL to Goodwood, with Marc Surer and (then BMW NA CEO) Tom Purves driving in 2002 and 2003. It was all great fun, not ridiculously expensive, and it gained a lot of good press.”

From the mid-1980s through 2020, BMW NA began retaining its factory race cars, which has certainly helped to preserve the cars within the collection. Over the last two decades, BMW NA has retained at least one example of each body style raced by Prototype Technology Group in the American Le Mans Series from 1995-2006. That includes the most highly-developed E36 M3 that won Daytona in 1997 and Sebring in 1998, and two E46 M3 GTR race cars, one of which has been restored to its 2001 specification complete with its exotic P60 V8 engine as well as the Stars and Stripes livery in which it won Petit Le Mans in October 2001; the other runs the six-cylinder engine with which it won the Grand Am championship in 2004.

The most spectacular car of the era is the Sebring-winning 1999 V12 LMR, and the most unusual is one of a pair of 2006 335d race cars that competed in the 25 Hours of Thunderhill to promote BMW Clean Diesel. Driven by Car & Driver staffers, the cars used superior fuel economy to finish fourth.

At the end of the 2006 season, BMW NA took a hiatus from racing—officially, for lack of an appropriate venue in which to race its M3s, though Koch says the move had a financial motivation, as well. “The value of the dollar dropped a lot [against the Euro that had replaced the Deutschmark in 2000] between 2006 and 2008, impacting BMW NA’s profit margins,” he said. “Budgets were cut even before the economy crashed in late 2008, which is why the motorsport program was cancelled for 2007 and 2008.”

With no racing program to oversee, Koch shifted his attention to production cars as part of his role as BMW NA’s Mobile Tradition/Classic Manager. He acquired one of each generation of 3 Series for BMW, as well as an E28 M5 and Alpina V8 Roadster. “After the 1996 BMW celebration at Monterey, I wrote a paper that basically said we should use BMW’s heritage to promote the brand, and to differentiate BMW from the Lexus/Infiniti/Acura brands that had no heritage,” Koch said. “A subsequent consumer survey showed that brand heritage was the third most important factor in BMW purchases at that time, so we embarked on a heritage campaign—you’ll notice references to it in the TV ads of the time. It was also very popular with the BMW CCA, whose members were great extensions of the brand.”

In 2007, BMW NA began a new partnership with Rahal Letterman Lanigan Racing, which handled the vintage cars until BMW returned to the ALMS in 2009. Developed in the wake of BMW’s withdrawal from Formula One, the E92 M3 GT was a showcase for aerodynamic and drivetrain developments.

When Koch retired in 2012, responsibility for BMW Group heritage worldwide had shifted to the Corporate Communications area of the company, so it made perfect sense for the BMW NA classic collection to be transferred to Tom Plucinsky, then Head of BMW Group Product Communications. “For me, it’s an honor and a privilege to be able to curate and preserve the heritage of BMW NA through the classic collection,” Plucinsky said.

“When I took over in late 2012 the E92 M3 GT racing program was just ending, and I inherited all the assets,” he continued. “We finished the 2012 season with two good cars, but unfortunately the chassis with the most provenance (#1101) had been crashed mid-season, and once the tub was repaired, it had remained as the spare chassis. My first order of business was restoring #1101 back to its 2012 Sebring-winning specification and livery. I also had to negotiate with BMW Motorsport to keep a couple of sets of the proprietary aerodynamic wheels that were used for the long races.”

Chassis #1101 with drivers Joey Hand and Dirk Müller won the ALMS titles for drivers, team, manufacturers, and Michelin Green-X Challenge in 2011, making it an especially important car within the collection.

“My second task was to rebuild #901, which was the very first M3 GT2 built and the 2009 Team and Manufacturers Championship-winning car,” Plucinsky said. “Again, both Team Principal, Bobby Rahal and BMW Motorsport were very supportive, finding the early parts and devoting the time needed to restore that car.”

For 2013, BMW NA and BMW Motorsport switched to the Z4 GTLM for IMSA racing in the US. In total, five examples of the Z4 GTLM were produced, of which the BMW NA collection holds four and BMW AG holds the fifth.

BMW NA also kept all four of the M6 GTLMs raced in 2016-2017, including the priceless John Baldessari Art Car (#1502) and the #1705 in “Bill Power” livery that took a GTLM-class victory in the 2017 Petit Le Mans, Bill Auberlen’s last race as a full-time BMW NA factory driver. The latter car is preserved as it took the checkered flag, complete with all of the dirt and debris it accumulated over ten hours at Road Atlanta.

In 2018, the M6 was replaced by the spectacular F92 M8 GTE, of which BMW intends to keep the cars that won Daytona (#1706) and Laguna Seca (#1802) in 2019 as well as a show car (#1705); the other three will eventually be sold. As BMW M Motorsport’s customer racing program has developed worldwide and race car engineering and parts support is available, BMW M Motorsport determined that it would be able to sell and provide support for the BMW M8 GTE. As a result, the 2020 Daytona winner has been sold to a private collector, and two others are ready to be sold for classic racing.

That’s a sizable collection of race cars, and maintaining it represents a substantial investment on the part of BMW NA. Since 2024, responsibility for the collection has been delegated to a new department: BMW Group Classic USA, led by Plucinsky.

Like Koch and Wensberg, Plucinsky ensures that the cars show off BMW’s heritage at concours events like Amelia Island, Legends of the Autobahn, and Pebble Beach. He’s also loaned them out for exhibits like Heroes of Bavaria and The Power of M at BMW CCA Foundation’s Ultimate Driving Museum, and to the Petersen Automotive Museum in Los Angeles. Along with static events, some of the cars like the ALPINA 2002—now restored in its original Alpina orange livery—and the CSL get to race at the Rolex Monterey Motorsports Reunion.

Along with that impressive fleet of race cars, BMW Classic USA maintains a fleet of roadgoing BMWs collected initially by Koch and Kenn Sparks, each of whom preserved BMW’s road cars for different purposes.

While Koch was collecting cars like the 2002 tii, E28 M5, Alpina V8 Roadster, and every generation of 3 Series, Sparks was ensuring that BMW Manufacturing preserved its own history in Spartanburg. As part of his job directing internal communications for the plant, Sparks became responsible for the Zentrum, the plant’s welcome center and history museum. “At the time, BMW Mobile Tradition was just getting underway, and BMW chairman Bernd Pischetsrieder instructed Christian Eich to give the Zentrum a selection of BMWs that would show off the history of the company,” Sparks said. “We also built our own historical exhibit with the models being assembled at the plant, like very first 318i ‘signature car’ and the James Bond Z3 from GoldenEye.”

Sparks preserved a coterie of interesting Z-cars assembled at Spartanburg, including the last Z3 M roadster built, a Z3 M coupe in rare Laguna Seca Blue, and an export-only Z4 Alpina Roadster S. He saved plenty of X-vehicles, too, including an X5 with American flag paintwork done as part of the BMW STEP program for body and paint students that has served as a powerful symbol of BMW’s engagement with the US.

Finally, the collection includes several classic Minis, a few BMW Group era MINIs, a number of motorcycles and some additional artifacts such as design models. The motorcycles include several from the Butler & Smith era (1954-1980) acquired by Fred Jakobs of BMW Group Classic for display at the Zentrum. Many of the bikes were featured in the BMW CCA Foundation’s 2023 exhibit, BMW Motorcycles: A Century of Innovation.

Now that all the individual collections have been brought together under BMW Group Classic USA, the division can take a more strategic view of what should be added to the collection. “Koch and Sparks had done a great job of acquiring vehicles that would be important to the histories of BMW NA and Plant Spartanburg,” Plucinsky said. “Now it’s my job to fill in some missing vehicles and to plan for the addition of current vehicles that will tell the story of the company’s history 10, 20, 50 years from now.”

As a case in point, last year Plucinsky was able to purchase a V10 powered E60 M5 with a manual transmission—a combination that was only available in North America. More recently, BMW Group Classic USA added the five millionth and six millionth vehicles assembled at Plant Spartanburg: an X5 M in Toronto Red and an X6 M in Java Green, respectively. “We chose the models because of the 5M and 6M right in the names, and we chose them in those colors because wanted to memorialize that the plant can now paint BMW Individual colors,” Plucinsky said.

In May 2025, the plant’s seven millionth vehicle was added to the collection. This time it was an ALPINA XB7 in ALPINA Green, marking the end of the independent ALPINA era and the beginning of a new BMW ALPINA era next year.

 “Today, the vehicles in the collection are used for a variety of communications initiatives,” Plucinsky said. “For example, last year was the launch of the new BMW M5 and M5 Touring, so examples of previous-generation M5s were in high demand for marketing and PR communications and events. This year is the 50^th Anniversary of the BMW 3 Series, so both the street and racing versions of these cars are in high demand. Finally, for my favorite classic activation this year, BMW NA celebrated the grand opening of its new headquarters on its 50^th Anniversary, and what better way to cut the ribbon than with the model that started it all for BMW in North America: the BMW 2002tii!”

For more than a century, the Santa Clara Valley was known as “The Valley of Heart’s Delight” for the abundant fruit orchards that filled this alluvial plain at the southern end of San Francisco Bay. By the 1980s, nearly all of the fruit trees were gone, replaced by the corporate headquarters and manufacturing facilities of the semiconductor industry that had given the area a new nickname: Silicon Valley. It’s where our digital world was first envisioned, where computers and networks evolved from highly specialized US Department of Defense projects into everyday tools for communication and entertainment.

As digital devices became ever more entwined with our lives—containing our calendars, our telephone and address books, and our music libraries, among other things—BMW of North America CEO Helmut Panke (1993-’95) recognized that they would find their way from our homes and offices to our cars. His colleagues in Munich agreed, and BMW opened its Technology Office in Palo Alto, California on November 18, 1998, in a ceremony at Stanford University.

“Before we opened the office, people would talk about how there was so much innovation coming from the West Coast. What is so special out there? Does it happen accidentally, or is there a reason for this? Do they do something differently than how we do it here in Germany? Let’s expose our people to this environment and see what happens,” said Dr. Joachim Stilla, who’d run the Technology Office from 2003 to 2005.

BMW’s newest think tank would be headed initially by 46-year-old Dr. Mario Theissen, who’d begun working in BMW’s engine department after completing his undergraduate degree in engineering in 1977. In 1991, two years after completing his doctorate, Theissen assumed a series of roles that put him at the cutting edge of BMW’s research and development: Head of Product Concepts, Head of Advanced Powertrain Development, and Managing Director of BMW Technik GmbH (the company’s first in-house think tank, established in 1985).

In 1998, Theissen was named Head of BMW’s Product and Technology Development Centers. From that position, he began to set up BMW Forschung und Technik GmbH, aka the BMW Technology Office, in downtown Palo Alto, California. This new outpost wasn’t far from the corporate headquarters of tech giants like Google and Apple, nor from world-class universities like Stanford and the University of California-Berkeley. The Tech Office was also within a few hours’ drive of BMW DesignworksUSA and BMW’s engineering center in Oxnard, California; together, the three offices became known within BMW as the “California Innovation Triangle.” While connected to the BMW mothership in Munich, they were able to take advantage of California’s innovation-focused culture, in which failure was an accepted result of experimentation.

“At Palo Alto, we have the freedom to try things out. This is one of the most flexible places in the BMW world,” said Stilla in 2005.

The Technology Office’s mission was, and remains, “to explore, evaluate, and transfer cutting-edge technologies primarily from non-automotive US industries to our partners within the BMW Group.” That includes “continuous technology exploration; identification of upcoming trends; the study, evaluation, and application of technology; the building of prototypes to prove feasibility; the development of promising innovations into products; and technology transfer.”

It didn’t take long for technology transfer to occur. In September 1999, less than a year after the Tech Office opened, BMW revealed its Z9 Concept at the Frankfurt Auto Show. Designed by Adrian van Hooydonk, the Z9 introduced not only the new BMW design language—which went into production with the E65 7 Series in November 2001—but also the revolutionary iDrive controller, which replaced a dashboard’s worth of knobs and buttons with a single knob on the center console. Using iDrive, a BMW driver could operate the audio system, climate, and navigation, all of which were displayed on a central screen.

“The basic idea [for iDrive, as the system became known] comes from two graduates of Stanford University, who originally developed the multifunctional control element in 1999 as a smaller version of control sticks for flight simulators,” declared a 2001 BMW press release, which revealed that the Tech Office had scouted the program that gave the controller its mechanical feel. “We didn’t invent iDrive, but we had a contribution,” Stilla said.

The E65 7 Series also marked the debut of Connected Drive, an in-car internet portal that could update the navigation system’s routes with real-time traffic information, and which could also be used to operate the mobile phone. Where short-range connectivity was concerned, the Tech Office was instrumental in bringing Bluetooth into BMW cockpits; this wireless interface arrived in 2002, and it’s ubiquitous today.

Those features were developed at the Tech Office using a vehicle dubbed the T-X5, which also served as a mobile testing lab for voice activation—another collaboration with researchers at Stanford—as well as the head-up display that projected navigation and vehicle information onto the car’s windshield. The latter technology was just making its way from military aircraft into production automobiles, with Chevrolet the first to adopt it. BMW wouldn’t put a head-up display into its production cars until 2003, by which time the Tech Office had already adapted it to the helmets worn by BMW-Williams Formula One drivers, and the sunglasses worn by sailors on the America’s Cup yacht of BMW-Oracle Racing. (Not coincidentally, Dr. Mario Theissen had left Palo Alto in 1999 to become BMW Motorsport Director, leading BMW’s efforts with Williams in Formula One.)

The BMW Technology Office’s early products weren’t exclusively electronic. Palo Alto and the nearby towns are also home to a cluster of aerospace companies, including NASA’s Ames Research Center, Lockheed Martin, Northrop Grumman, and RTX. “Thanks to NASA branches and companies in the aircraft industry, there are also a wealth of material technology and production-related developments here,” said Holger Jeebe, who led the Technology Office from 2000 to 2002. Collaborations with the aerospace industry helped BMW equip its M cars in particular with ceramic brakes, whose base material was first used by NASA as a heat shield, with lightweight but strong carbon fiber driveshafts, and with pedestrian-protecting hoods made of thin sheets of aluminum strengthened with a honeycombed core.

Perfecting the human-machine interface has always been integral to the Tech Office’s mission, and in 2004 the Technology Office bridged the connectivity gap between BMW and Apple’s iPod music player. Drivers had long been able to connect the iPod by cable from the headphone out jack to the audio system’s AUX port, with another cable and adapter providing power from the cigarette lighter, but that was both cumbersome and inelegant in a way that offended Apple Computer’s iPod manager Stan Ng.

“He took a picture of all these white cables and said, ‘I don’t want this. I want to connect the iPod to the head unit and put the iPod in the glove box,’” said Patrick McKenna, then a manager within BMW’s Marketing Department. “We put Stan together with our tech engineers, and they found the solution pretty quickly. It was called iPod Your BMW, and it basically fooled the head unit into thinking there was a six-disc changer in the glovebox, but it could only access six BMW-labeled playlists.”

Closer integration followed, and soon an iPod could connect directly to the BMW’s audio system via Apple’s 30-pin cable, which allowed full access to the device’s contents through the head unit. “iPod Your BMW really opened the doors to a regular, continuous dialogue with Apple from that point forward,” McKenna said.

As the iPod gave way to the iPhone—which wasn’t merely a mobile phone but a hand-held computer that could be configured to provide everything from email to calendars to music to navigation and beyond—the smartphone revolution was upon us. At the Tech Office, integrating the smartphone with the automobile became the crucial task at hand, according to Stefan Durach, who led the Tech Office from 2008 to 2011, taking over from Stilla’s immediate successor Dr. Bernardo Lopez.

 “In the past, you would buy your BMW, and it would have a certain feature set that would remain stable over its lifetime. The features and the interaction with the car never changed, and it was the same with phones from Nokia or other players,” Durach said. “When the iPhone hit the market, it was a completely different game. You just get a piece of hardware, and you customize it over time. You get new features, new products, new experiences. We wanted to participate in this, offering new features in the car, and we thought the phone might be a good bridge to get access to the music apps, and all the stuff they built at that point in time.”

Doing so would involve more than simple engineering. It also required Durach and the Tech Office to bridge two disparate cultures when it came to product development and production timeframes.

“The automotive industry, and BMW in Munich, is dominated by precise planning, because you have to prepare your manufacturing to assemble the cars for a seven-year lifecycle: to build up stock of parts, to build the mechanical tooling, etc. It takes time,” Durach said. “The tech industry side has a super, fast-turning way of developing product, and if you want to work in the auto industry and technology at the same time, you have to define the right environment where you can experiment, try things out. If you want to integrate the latest and hottest features, you can take this decision only a couple of months before, not three years in advance.”

Initially, the problem was solved by using Apple’s standard interface, just as BMW had done with iPod Your BMW. Soon, that was replaced with CarPlay, a software solution that BMW was first to integrate into an automobile on the OEM level. This, in turn, allowed customers to stream music from companies like Pandora, or to use social media products from Facebook, from their BMW or MINI’s central screen. “If we had done that on the normal development cycle of a car, we would have had Friendster in the car instead of Facebook,” Durach said.

The Tech Office provided the crucial link between Silicon Valley’s smartphone technology and the automobile, Durach said. “The idea was, how do we enable the customer’s personal digital ecosystem, which he uses daily, and make it usable in the automotive content frame? We weren’t going to build the next music app, but we wanted to integrate a great music service like Pandora into the car. We were the first to do that, and with the hottest service on the market.”

While smartphone integration provides the most visible evidence of the Tech Office’s influence on BMW’s automobiles, the division was also crucial to the development of technology related to battery-electric cars, which began reaching customers as the MINI e and ActiveE prototypes in 2009 and 2011, respectively. The Technology Office developed an app that would let ActiveE drivers monitor their vehicle’s charge status, locate charging stations nearby, and pre-condition the cabin for heating or cooling. Such specialized apps were largely unknown in 2012, but the ActiveE app has since been followed by a number of vehicle-monitoring apps, including today’s all-encompassing My BMW app.

Despite the Technology Office’s extensive collaborations with Silicon Valley firms, BMW didn’t always adopt the latest innovations wholesale. Fully autonomous driving technology, for example, was deemed inappropriate to The Ultimate Driving Machine, so BMW chose to employ its radar and Lidar sensors as well as cameras to enhance safety through features like Lane Departure Warning and Active Cruise Control. Other aspects of autonomous driving technology were used to augment the car’s GPS system to improve fuel economy or range. “We started this at Palo Alto and now our friends at Munich have taken over,” said Dr. Stilla.

Not everything developed in Palo Alto was electronic. The Tech office also worked to bring new nanotechnology-infused upholstery to BMW, with fabrics that repelled dirt and offered exceptional durability. “Nanotechnology deals with particles and surface structures where the layer thickness is so small that they’re measured in 10 to the minus 10th,” Stilla said, noting that the Tech Office was also investigating high-strength materials that reduce internal engine friction.

In 2011, having outgrown its small space in downtown Palo Alto, the Technology Office moved to Mountain View, to a much larger facility between those occupied by tech giants Intuit and Google. Regardless of its location, the Technology Office has been instrumental in making BMW a truly global company with respect not only to production, but also where design and technology are concerned. The Northern California outpost has been joined by a similar technology hubs elsewhere: in Munich; Seoul (established in 2024 to focus on display technology); Shanghai (where the company explores the human-machine interface, AI, and hardware-software integration since 2023); Tel Aviv (where BMW has connected to startups and research universities since 2019); Tokyo (which develops sensors, hydrogen technology, and the BMW Holo-Active Touch system); Greenville, South Carolina (where IT research is conducted at Clemson University); and Singapore (which explores blockchain for BMW).

The Technology Office has influenced nearly every aspect of today’s BMW Group automobiles, and the cars have evolved in ways that might not have been possible without a BMW presence in Palo Alto or Mountain View. “There’s so much innovation happening in Silicon Valley on a daily basis, but you really have to build a network of people you know on a personal basis with whom you can discuss topics long before they’re getting to a product level,” Durach said. “It’s about being there, meeting these people and having a constant exchange with them at the breakfast meeting, the lunch meeting, or the evening event, where you can say, ‘Okay, I have an idea,’ or ‘I would be interested in…’ You can’t have this kind of discussion remotely.”

— ends —

On September 8, 1994, the first car rolled off the line at BMW Manufacturing, and the North American BMW world began spinning on an unlikely new axis in Spartanburg, South Carolina. Shortly after the plant opened, enthusiasts began congregating at the Zentrum, the plant’s museum and welcome center, and in 1999 the BMW Car Club of America relocated its headquarters to nearby Greenville. For those who love driving, the best was yet to come, and it arrived in 2000, when the BMW Performance Center opened right across the highway from BMW Manufacturing.

The Performance Center’s gestation began in 1997, when BMW NA president Vic Doolan and vice-president of aftersales Hans Duenzl asked the Professional Development department (now BMW Group University) to put together a plan for a “BMW Academy and Delivery Center” that could be established alongside BMW Manufacturing in South Carolina.

“The vision was to create a facility where we could conduct technical and non-technical training for our dealers, as well as have an opportunity to drive all of our cars in addition to being a destination for owners to take delivery of their new BMWs,” said Tom Salkowsky, who joined the Professional Development group that year and currently serves as Department Head of Pre-Owned within BMW Financial Services. “The idea of the Performance Center came alive within that team.”

In the fall of 1999, the as-yet-unnamed facility hosted all US dealers for the introductory ride-and-drive of the first-generation E53 X5 built across the highway at BMW Manufacturing. In early 2000, the newly-christened BMW Performance Center welcomed its first customers.

 “I had just started as M Brand Manager, and we had just launched the E39 M5,” said Salkowsky. “At that time, within the MSRP of the M5, all of the owners were invited to the M5 Driving Experience, which brought owners to our facility and got them behind the wheel of a fleet of our M5s. One owner described it as a Field of Dreams: You built this, and now we get to come here and learn about what the M5 is capable of, as well as BMW’s new footprint in America.”

The M5 Driving Experience was followed by a similar program for Z8 owners and another for those taking delivery of their Neiman Marcus X5s. All three programs echoed those conducted “on a much smaller basis” by Doolan during his tenure as president of BMW South Africa from 1978 to 1987.

Doolan left BMW NA in 1999, just as the Performance Center got rolling, but his successors were equally keen to utilize the facility, which was the only one of its kind in the US. “Nothing demonstrates why you want a BMW better than getting behind the wheel of a BMW,” said Jim McDowell, BMW NA’s Vice-President of Marketing and Product Strategy from 1993 to 2005. 

At the Performance Center, BMW put customers behind the wheel on a purpose-built, 1.5-mile course. Following the success of the M5, Z8, and X5 programs, the Performance Center—managed initially by Tom Troy—began offering one- and two-day car control clinics as well as courses for newly-licensed teenage drivers.

BMW had been conducting its Fahrer [Driver] Training programs under the auspices of BMW M GmbH in Germany since 1977, so the concept was well known within the company. Rather than import BMW Fahrer Training directly to the US, the Performance Center contracted with AlémWerks, a Colorado-based motorsports and marketing firm that today runs the Porsche Driving Experience, established in 2015 along similar lines to the BMW Performance Center. “Dan McKeever at Além and Tom Strahs put the curricula together originally,” said Mike Renner, who joined the Performance Center’s instructor ranks in 1999. Later, instructors with ties to the Skip Barber racing school brought elements of that school’s curriculum to the Performance Center.

To promote the programs, BMW aired informercials on international flights to the US. “As you were flying in to JFK or ATL, you’d hear my voice talking about everything that BMW was doing in the US, the factory tours, the new Performance Center driving school,” said Kenn Sparks, then a communications manager at BMW Manufacturing. “It was the first time that BMW had branched out of typical advertising into something so totally non-traditional as in-cabin audio.”

Between effective advertising and word-of-mouth from those who attended its driving programs, the Performance Center became a bona fide hit. “It was overwhelmingly successful for customers who made the trek to South Carolina and then got to experience what BMW was all about,” Salkowsky said. “They could learn a bit of history at the Zentrum, go on a tour of a modern, clean manufacturing facility, then come across the street and drive these wonderful machines.”

From the initial car control clinics and teen driving schools, the Performance Center’s programs quickly expanded to include the M cars, with one- and two-day M Schools. Initially, the M Schools used the Performance Center track on day one, then moved to the higher-speed Michelin testing facility in nearby Laurens, South Carolina for day two.

For its Advanced M Schools, the Performance Center took students to Charlotte Motor Speedway, Virginia International Raceway, or Road Atlanta, all top-notch facilities that allowed drivers to reach higher top speeds and experience the full performance of the M cars.

In 2004, with the Performance Center’s programs exploding in popularity, Troy headed west to find a suitable location for second facility—one that could host the Advanced M Schools as well as the lower-speed programs. To head the Performance Center in Spartanburg, BMW NA tapped its assistant controller for marketing operations, Dan Gubitosa, to take over operations that also included a workshop to service all of the 8,000 or so vehicles used by BMW Manufacturing.

In 2006, Gubitosa put his business background to good use, securing approval to expand the Performance Center track. “I made the business case that this is one of our most popular programs, one that generates significant revenue and pays for itself,” Gubitosa said. “I think it was only half a million dollars to expand the track by about three-quarters of a mile, and now we have a pretty long back stretch where you can get an M car up to a proper speed.”

The longer track allowed the Performance Center to host all but the Advanced M Schools, in an environment that would challenge both car and driver. “It has a fair amount of elevation change, and lots of nuances,” Renner said. “The main braking zone is downhill, which allows us to talk about the effect of weight transfer on the car, and other areas have a slight banking. It has compromise corners that illustrate how to set up the car for the next section of track, and off-camber sections. It’s designed to be challenging, fun, and safe.”

In 2015, the Performance Center’s West Coast counterpart opened in Thermal, California, just outside Palm Springs. “The great thing about Thermal is that we have access to three real race tracks,” Gubitosa said. “We can do many more high-speed programs, including the Advanced M School, and we can run our M4 GT4 race cars there.”

The M4 GT4 program is a new addition to the Performance Center curriculum, but it’s already proving popular. “There aren’t many places where Joe Smith can drive an honest-to-God factory- race car on a track,” Renner said. “A lot of people don’t think they could drive a race car, but if you’ve driven our M4, you’d be familiar with the controls. The cars have paddle shifting, stability control, and ABS, so it’s a great experience for a race-car novice even though it’s exciting and challenging. We also have private coaching for people who want to buy an hour or two with an instructor, and that’s popular.”

Interestingly, the Performance Center West also offers an SCCA licensing program for those who wish to go racing, though that takes place in M4 street cars rather than in the GT4s. “It’s a niche, but it’s good to offer it,” Gubitosa said.

Another niche experience offered at Thermal is the M Mixed Reality Experience, which uses virtual reality goggles to add a digital track layout atop an open track area. “It’s a unique event that blurs the boundaries between technology and reality,” proclaims BMW’s marketing for the program.

Regardless of what they’re driving, BMW enthusiasts appreciate the opportunity to join Performance Center programs on either coast. In 2024, about 10,000 customers took part in programs at Thermal, with another 18,000 visiting the Performance Center in Spartanburg. The latter number gets a boost from the 2,000 customers per year who take delivery of new BMWs at the Performance Center, which includes a driving school that puts them behind the wheel of a BMW similar to the one they’ve just purchased.

That’s true even if the vehicle in question is an X-vehicle, which customers have been able to experience on the Performance Center’s Other Roads course since 2002. BMW’s off-road motorcycles have their own home at the Performance Center, where the BMW Rider Academy stages programs using BMW’s popular GS motorcycles; on-road motorcycle courses are held on the regular Performance Center track.

Regardless of what they drive or ride, those who visit the Performance Center become loyal and vocal customers, Gubitosa said. “Only a small percentage of BMW customers take part, but those who do become brand ambassadors. We try to measure it, and we think there’s an additional ten percent conversion based on word of mouth. People tell their friends that BMW took great care of them, that it’s an awesome company and an awesome car. We know it works.”

It works for its employees, too, as evidenced by the long tenure of instructors like Renner and managers like Gubitosa. “The customers make it fun, and I get to see happy customers every day,” Gubitosa said.

While BMW of North America was busy fending off its new premium-class rivals Lexus and Infiniti, the company found itself challenged by yet another new rival: Ford, whose Explorer had become an immediate sensation following its 1991 introduction.

Conceived as a modest redesign of the long-running Bronco II, the Explorer lured American drivers from their sedans and minivans into what Ford dubbed a Sport Utility Vehicle—a station wagon-style body atop a four-wheel drive truck chassis. When Jeep followed a year later with its luxurious Grand Cherokee, it solidified the hold of these high-riding SUVs on the car-buying public.

BMW’s own lineup was limited to sedans and wagons, but the company had already recognized the need to diversify its offerings with new body styles. The Z3 roadster was under development in Munich, but BMW preferred to get on the SUV bandwagon via a different route: by purchasing Land Rover, a company well known for its off-road vehicles.

Brand acquisition was a common theme in the early 1990s. Ford acquired Volvo, for example, while Chrysler took on Jeep and Dodge, General Motors purchased Saab, and Volkswagen acquired a slew of brands including SEAT and Skoda.

Not to be left behind, BMW did the same. Led by a new chairman of the board—Bernd Pischetsrieder, who replaced longtime chairman Eberhard von Kuenheim in May 1993—BMW offered British Aerospace £800 million for its 80 percent share of the Rover Group on January 26, 1994. Shortly after, BMW would acquire the remaining 20 percent from Honda, and with that BMW became the owner of 15 British brands including Rover, Mini, MG, Triumph, and Riley, the latter a particular favorite of Pischetsrieder.

The Rover acquisition would allow BMW to sell off-road capable vehicles under the Land Rover nameplate, competing with Ford and Jeep while preserving the purity of the BMW brand for use on sporty, high-end passenger cars.

Land Rover had introduced its P38A Range Rover in September 1994, but the car was outdated even before it launched. In 1995, BMW began designing its replacement, the L322. The initial phase of that project would take place in Munich at the Special Vehicles department led by Dr. Burkhard Göschel.

Göschel was well aware of the burgeoning popularity of SUVs, and he believed he could build one that embodied BMW’s traditional virtues of high performance and agile handling. While working on the L322 Range Rover, Göschel decided to build an off-road capable BMW alongside it. “Mr. Pischetsrieder was totally against this,” Göschel said, “but I told him there is a difference between both brands that you can realize.”

Within BMW of North America, president Vic Doolan was already asking Munich for a BMW that could complete with the Explorer and Grand Cherokee, and so was Rich Brekus, who’d been hired as head of product planning in June 1994.

“When I was being interviewed for the job,” Brekus said, “Vic asked me one critical question, and I still don’t know if it was a serious question or if he was testing me. He said, ‘Munich is thinking about doing a minivan. Do you think we should do a minivan?’ I said, ‘You’d be out of your mind to do a minivan, but you need to do an SUV. Not an off-road SUV, but an on-road SUV. That’s where the market’s going.’ You could see it at the time, with the Cherokee and Explorer selling like crazy but never going off-road.”

In meetings with Munich executives, Doolan presented photos of what he called The BMW Garage, with a 3 or 5 Series sedan parked side-by-side with an Explorer. “They were photos of real garages,” said Brekus. “We said, ‘We want to own the garage,’ and that became a mantra. Why should we let anybody else in the garage?”

Ford was hardly a rival for BMW’s sedan business, but Mercedes and Lexus certainly were. As was well known within the automotive business, both companies were developing their own SUVs for release in 1997: Lexus the RX, Mercedes the M-class.

“Owning the garage was paramount to us, and I saw a real risk to BMW if we did not enter the [SUV] segment,” Doolan said. “If our owners could add a competitive vehicle to their multi-vehicle garage, that would give Mercedes dealers access to our owners. As the M-class was near launch, we changed the renderings to show a 7 Series and a Mercedes ML next to it, illustrating the risk that the 7 Series would be replaced by an S-class.”

Doolan and Brekus put Bert Holland in charge of strategy for a BMW SUV project. Holland assembled the necessary data and analysis, product attributes, and the visual materials needed to make NA’s case for an SUV. Doolan told the board that BMW had two choices. “We had two choices. One, we could combine BMW and Land Rover dealerships, so each marque could retain its identity and create a cross-sell opportunity,” Doolan said. “The alternative was to introduce a BMW SUV.”

Doolan met with BMW board member for research and development Wolfgang Reitzle and Land Rover’s John Russell shortly after Thanksgiving 1995. At a Marriott hotel near New York’s LaGuardia airport, Doolan presented an artist’s rendering of the combined BMW-Land Rover facility. “Russell dismissed that with the phrase, ‘Over my dead f*ing body,’” Doolan said. “Reitzle called an immediate end to the meeting, and he, Helmut Panke, [BMW NA chief financial officer Dr. Karl] Sommer, and I went to dinner. I again pushed for a BMW SUV, and Reitzle said, ‘You will get it.’”

In his own discussions with BMW management, Brekus had insisted on specific attributes for such a vehicle. “I told them I didn’t want a truck. I wanted the form factor of an SUV, but I wanted it to drive like a car,” Brekus said. “This was all about on-road performance, and I didn’t care about off-road. They said, ‘Mercedes is looking at this, too!’ I said, ‘Yeah, but they’re going about it all wrong. The M-class is body-on-frame with a two-speed transfer case. Nobody wants that.’”

In other words, Brekus wanted an SUV that would fulfill the promise of The Ultimate Driving Machine. “Reitzle began to see that, and maybe became intrigued by the technical question of how to build an SUV that drives like a car,” Brekus said.

At Special Vehicles, Göschel was trying to answer the same question. Having handed final development of the next-generation Land Rover over to his counterparts in Solihull, England, he experimented with SUVs based on BMW’s 5 Series wagon. “Everybody thought BMW was going to do a high-roof wagon, and all the BMW enthusiasts were appalled,” Brekus said.

Indeed, the idea of a BMW truck was considered heretical by BMW traditionalists, who underestimated Göschel’s ability to turn an SUV into an Ultimate Driving Machine. Toward that end, Göschel borrowed chassis elements like the MacPherson strut front/multilink rear suspension from the 5 and 7 Series sedans, executed in steel rather than aluminum for added durability. He also borrowed a crucial piece of technology from Land Rover: Hill Descent Control, which used the car’s anti-lock braking system to limit speed while going downhill. HDC allowed Göschel to eliminate a four-wheel drive’s heavy transfer case, with the low range normally used for that purpose. In a further stroke of genius, ABS could replace the usual locking differentials at the front and rear axles, saving still more weight and eliminating mechanical complexity in favor of electronic control through the ASC+T (Automatic Stability Control + Traction) and DSC 3 (Dynamic Stability Control) systems.

Doolan had insisted that the SAV be not only a great-handling vehicle, but a good-looking one. At Designworks/USA, Chris Chapman penned stylish bodywork that combined elements of the then-new E39 5 Series with attributes of an SUV. In the modeling phase, Frank Stephenson contributed a BMW-esque interpretation of the C-pillar. “Both Chris and Frank made scale models and went to Italy to develop the full-sized model at G Studio, pairing off on the sides,” said Chris Bangle, then head of BMW Design. “As time went on, the command of the design went to Chapman, but the major contribution of Frank—the station wagon-styled C-pillar with the BMW dogleg—remained. Chris’s original design had a more classic SUV C-pillar known as a ‘6,’ but his had the overall balance and surfacing the car was born with.”

As designed, however, Doolan identified a flaw that would be corrected for production. “We fought hard to expand the rear luggage space, which was far too small in the first iteration,” he said. “The X5 wasn’t designed to cart stuff, but to enable our owners to enjoy their activities. Therefore I thought it logical to call it a Sport Activity Vehicle rather than a Sport Utility Vehicle.”

Doolan’s phrase proved a stroke of marketing genius, but the X5 still needed a compelling business case to be approved for production. “The eventual deciding factor was providing a volume vehicle for the Spartanburg plant,” Doolan said. “Z3 sales were easing, and building the 3 Series there would demand investment in additional tooling. The X5 was the solution.”

By the spring of 1998, BMW had confirmed its plans to assemble a Sport Activity Vehicle in South Carolina, and spy shots were circulating in the press. Pischetsrieder said the vehicle would be built on the basis of the 5 Series wagon, and that it would have the tall ride height and ample cargo space of a typical SUV while handling more like a passenger car than a truck.

On January 9, 1999, BMW unveiled “the world’s first Sports Activity Vehicle” at the Detroit motor show. In its press release, BMW said that the X5 “is characterized by those well-known BMW features typical of the brand: aesthetic design, dynamic styling and performance, and superior safety. In addition, the X5 is characterized by a completely new sense of driving, especially by the high seating position and the exceptional handling on roads of any kind throughout the world.”

At the urging of Doolan and Brekus, the X5 was introduced with a 286-horsepower, 4.4-liter V8 engine, which allowed the 4,828-pound SAV to scoot from zero to 60 mph in 7.5 seconds. A 3.0-liter inline six was also available, including a diesel version for markets outside the US, and either of the smaller engines could be paired with the five-speed manual transmission that wasn’t offered with the V8.

Along with the manual transmission, the six-cylinder X5 3.0i was available for a much lower price than the V8-powered X5 4.4i, which was offered for $49,400 at its launch. “The initial pricing was critical in ensuring the success of the X5,” Doolan said. “Our proposal was $38,900 for the six-cylinder. The finance people wanted the price to be significantly higher, but thanks to a powerful argument delivered in English by Dr. Reitzle, we prevailed.”

In the fall of 1999, BMW introduced the X5 at an international press launch in Spartanburg, South Carolina. After driving the X5 4.4i (the 3.0i wouldn’t go into production until April 2000) on the street, journalists tested the vehicle’s off-road capability on the muddy dirt trails and steep inclines of Little Creek Farms. “It had been an off-road site for testing Land Rovers, and the Germans were concerned that the X5 wasn’t strong enough to handle it,” said Kenn Sparks, who began working in the BMW Manufacturing press department the week of the launch. “Well, it handled it phenomenally! I remember driving through mud so deep we just knew it was going to sink, but it kept going, even in reverse. Then, while the journalists were having lunch, the vehicles were washed, and we drove the very same vehicles to Road Atlanta. After doing this pretty serious off-roading, the next thing you know you’re racing through the chicane at Road Atlanta. That blew everyone away.”

Shortly after the X5’s launch, two of its biggest champions left BMW. As the purchase of Rover was proving so disastrous as to threaten BMW’s autonomy, Bernd Pischetsrieder was ousted as chairman, replaced by production director Joachim Milberg. Having been passed over for the top spot for a second time, R&D chief Wolfgang Reitzle resigned from the BMW board. He was quickly picked up by Ford, which then purchased Land Rover from BMW for $2.9 million—Rover itself was sold to the Phoenix consortium for the nominal sum of $16—and tapped Reitzle to run it as part of Ford’s new Premier Automotive Group that included Lincoln, Jaguar, Aston Martin, Jaguar, and Volvo. Reitzle, in turn, hired BMW NA president Victor Doolan to be the Premier Automotive Group’s executive director. The X5’s engineering mastermind, Burkhard Göschel, ascended to the board in 2000, responsible for research and development.

BMW’s first Sports Activity Vehicle went on to become a huge success, with 616,867 examples of the first-generation E53 X5 assembled in Spartanburg between September 1999 and September 2006. Of those, more than half were exported, helping BMW Manufacturing become one of the largest automotive exporters in the NAFTA region, and the largest overall in terms of value.

“The X5 transformed BMW,” Doolan said. “It facilitated the growth of Spartanburg into the largest plant in the BMW world, spawned a complete range of SAVs enabling tremendous growth of the BMW range globally, and enabled the sale of Land Rover to Ford, generating much-needed cash and getting rid of the albatross that was Rover.”

Now in its fourth generation, the X5 remains the centerpiece of BMW’s X-vehicle lineup, which ranges from the compact X1 through the full-size X7 and high-performance XM—all Sports Activity Vehicles, not SUVs.

In the mid-1990s, Harley-Davidson’s laid-back V-twins were among the most popular motorcycles in America, inspiring countless imitators from Japanese and Italian manufacturers. Even sport-oriented Ducati got into the cruiser act, after which it was only a matter of time before BMW did the same.

“The cruiser segment was doing so well, and it kept growing, especially in the U.S.,” said Phil Capossela, Vice-President of BMW of North America’s motorcycle division since August 1991. “We asked if BMW could do something that would be competitive, and BMW Motorrad was open to it.”

Rather than build a Harley clone, BMW created a cruiser with a distinctly Bavarian twist. Where other cruisers were defined by their V-twin engines, BMW featured Munich’s traditional boxer twin, here surrounded by an innovative design created under the leadership of American native David Robb.

As BMW’s first designer to work exclusively on the motorcycle side, Robb had been tasked by BMW Group Design Chief Chris Bangle with modernizing BMW’s two-wheelers. As part of that process, Robb wanted to liberate the company’s designers to explore new niches beyond the familiar touring and GS categories.

“The talent was there,” Robb said. “In the past, that talent wasn’t always given the opportunity to push the boundaries.”

The cruiser project would allow BMW designers to do exactly that. It began at Designworks/USA in Southern California, where Richard Kong sketched a bike that was refined for production by BMW Design’s Dietmar Finger. Finger, in turn, supervised the creation of a styling model by Stefano Ardagna and Saverio Spadone at Studio Torino in Italy.

Where an automobile cloaks its mechanical elements in a sheet-metal skin, a motorcycle often leaves those elements exposed, emphasizing its raw functionality. BMW’s cruiser made the most of that design opportunity, using a bespoke frame with a cast aluminum front section that was as much sculpture as structure. An all-new Telelever front suspension employed the rakish geometry typical of a cruiser, here executed in bright aluminum. “We said, ‘Let’s not hide the function of the Telelever,’ and it became a work of art,” Robb said.

The then-current Paralever rear suspension wouldn’t work, so the designers reverted to the older Monolever design, lengthened by more than three inches and with a reinforced tube to contain the driveshaft. The single-sided Monolever set the cruiser even further apart from its competition, giving its left side a minimal appearance in which the rear shock was clearly visible along with the suspension linkage.

That was a nice retro touch, as were the swept-back handlebars, polished valve covers, stubby exhaust pipes, spoked wheels, a deeply valanced rear fender, solo saddle with passenger pad, chrome headlight, and gauges mounted on the triple clamps. Following the Harley model, BMW offered a wide range of customization options that increased the bike’s versatility, enhancing its touring capabilities or altering its appearance to suit its owner’s preferences.

In the midst of those unfamiliar design flourishes, BMW’s traditional boxer engine gave the cruiser an unmistakable Bavarian identity. With 1,170cc of displacement, the A63 engine was BMW’s largest oil-head boxer, and it would be available exclusively in the bike designated as the R 1200 C for the duration of its production run.

With its fuel injection system hidden behind nicely detailed panels, the A63 delivered 61 horsepower at 5,000 rpm and 72 pound-feet at 3,000 rpm. Its torque-biased output was a clear shot across Harley’s bow, as well as a nod to the R 1200 C’s mission as a bike for relaxed travel over moderate distances rather than high-speed canyon carving or cross-country adventures. As such, the bike drew criticism from BMW’s traditional clientele, who questioned its authenticity after its launch in 1997.

“We’d never had such a thing, so there were questions whether this was really a BMW,” Capossela said. “But once people started riding it, they did embrace it, and so did the dealers, who were getting a totally new product in a totally new segment.”

Just as the R 1200 C was arriving in dealerships, it received valuable exposure as the second BMW to appear in a James Bond film. Thanks to a product-placement agreement negotiated by Tom McGurn of BMW’s Corporate Communications department, James Bond had driven a pre-production Z3 roadster in 1995’s GoldenEye. It was set to be followed by another BMW sports car, but the company had nothing suitable in the pipeline when the Bond producers arrived in Munich in the fall of 1996. Perhaps a motorcycle would do?

“I presented this still-new bike, the R 1200 C, which wouldn’t be released until the fall of ’97,” Robb said. “Polite compliments about the bike and the presentation were exchanged. After that, plus the narrative that their film had no motorcycles in it, they flew back to Southern California.

“A week before Christmas, our marketing department got a call from Hollywood. The company would like six of the motorcycles early next April, plus a fleet of BMWs and Range Rovers. They had rewritten the script around the bike, and now we had to knock out half a dozen of these motorcycles by hand!”

Tomorrow Never Dies premiered on December 9, 1997. The film put Pierce Brosnan and Michelle Yeoh, hand-cuffed together, in command of the R 1200 C for a chase scene. That gave the bike a big promotional boost shortly after its launch, and later that year the Guggenheim Museum included the R 1200 C in its The Art of the Motorcycle exhibit.

The R 1200 C had broken the mold for what a BMW motorcycle could be, it brought in new customers to the brand and added significantly to BMW Motorrad’s volume in the USA. From 1997 to 2004, BMW sold a total of 40,218 examples, most of which were sold in North America.

“I thought that number was pretty good, and developing a totally different motorcycle was a good step to take,” Capossela said. “I think the Harley people were laughing at first, but then they weren’t. They realized it was a pretty damn good motorcycle.”

The R 1200 C had no direct successor, but in 2020 BMW re-entered the cruiser segment with the retro-style R 18. Like the R 1200 C, it used BMW’s largest-displacement air/oil-cooled engine, this time a massive 1,802cc boxer twin. Its distinctive styling—by a team led by Ola Stenegard, working under Motorrad design chief Edgar Heinrich—took inspiration from the R 5 that had revolutionized BMW in 1936. Like the R 5, the R 18 used a frame made of steel tubes of varying thicknesses, mated to a swingarm that mimicked the look of a hardtail. The driveshaft was plated in nickel and left fully exposed just like BMW’s traditional bikes from Munich. At the front, the R 18 eschewed the Telelever in favor of traditional telescopic forks like those pioneered on the R 5. Spoked wheels and a single round headlight completed the vintage look, the latter with modern LED technology and optional adaptive turning. Other contemporary features included keyless operation and three riding modes—Rain, Roll, and Rock—for throttle and traction control.

The R 18 launched in the middle of the Covid pandemic, a difficult time for vehicle sales worldwide, yet it helped BMW record its second-best sales year to date in 2020. BMW Motorrad delivered 169,272 motorcycles to customers that year, about half of which were boxer-engine bikes including the R 18. Now offered in three model variants, the R 18 helped Motorrad sell 209,257 motorcycles in 2024, a record number in its 101^st year of producing 2-wheeled BMWs.

—End—

BMW has been building motorcycles for police and the military since the early 1930s, and its bikes are widely used by police departments from Europe to the Far East. In the US, however, BMWs have always been somewhat rare compared to the Harley-Davidsons favored by patrol officers on the East Coast or the Kawasakis preferred out West.

BMW first challenged both of those well-established marques in 1984, when it sold about 150 of its R 100 RT motorcycles to the San Francisco Police Department. Although that program was considered successful, BMW withdrew from the authority market after Kawasaki lost a $10 million liability suit related to the death of a Houston officer while on duty. A few years later, the introduction of anti-lock braking on the K 100 and K 75 led BMW to reconsider.

“We started dipping our toes back into the police business with the K 75,” said Frank Stevens, then BMW Motorrad USA’s National Sales Manager. “We did some test sales, but the K 75 was not an ideal police motorcycle because of its riding position, its saddlebag design and storage. It was expensive if you dropped it or fell over, because the protection system wasn’t very good.”

The California Highway Patrol had a fleet of about 400 motorcycles, of which it replaced about 150 each year. In 1994, the organization agreed to purchase 20 ABS-equipped BMW K 75 RT-Ps to test against the Kawasaki KZ1000P, which constituted the majority of its fleet but hadn’t been updated since 1982.

 “ABS was generally perceived by the CHP as a real benefit, but they couldn’t find any statistical way to prove it, and because of that they couldn’t mandate it,” Stevens said. Nonetheless, BMW used data from the K 75 RT-P test to improve its forthcoming R 1100 RT-P, which would be equipped with not only ABS (and the K 75’s adjustable windscreen) but better protection bars and other features to suit the CHP’s needs. That included a second battery with linked charging from a more powerful alternator, and an auxiliary fan behind the oil cooler that allowed the bike to idle for extensive periods without overheating—a huge advantage over Harley, in particular. Its handling was more stable than that of the K 75 RT-P, yet the R 1100 RT-P also had greater agility, including the essential ability to make a U-turn within 16 feet.

The new R 1100 RT-P was significantly better than its K 75 RT-P predecessor, and it easily outperformed the Kawasaki and the Harley. Unfortunately, its price of $15,828—as reported by the San Francisco Chronicle—was more than twice the $7,871 price for a Kawasaki. The R 1100 RT-P’s maintenance costs per mile were lower than those of the KZ1000 P, but BMW still had to get creative in order to secure the CHP contract.

 “We didn’t want the liability of a lease, so we sold the motorcycles with a buy-back clause,” Stevens said. “The perceived useful life of the motorcycles was 60,000 miles, but we knew the motorcycle had a tremendous amount of life beyond 60,000 miles. California agreed to pay much more up front because their total cost would be less, if the motorcycle survived to the end of the term.”

BMW agreed to re-purchase the bikes for $9,928 each, reducing the net cost to $5,900—$100 lower than the price of the Kawasaki that the state would typically auction for $600-1,800 after three years on the road.

It was the first time California had been able to include a buy-back clause in its cost calculations, and Stevens credited Jerry Haleva’s lobbying firm, Sergeant Major Associates, for getting it done. “It was our idea, but Jerry got it signed off,” Stevens said.

That wasn’t the end of the process, however. The initial approval of the R 1100 RT-P had been made by a sergeant at the CHP Academy who’d left in the interim, and his replacement had to confirm that the bikes being delivered met the standard established during testing. While riding the bike at the CHP’s test track, the new sergeant detected a wobble after crossing a drainage rut. Stevens flew to California to investigate but found nothing wrong; indeed, the bike was functioning as-designed, self-correcting after the disruption. When the CHP sergeant refused to accept that explanation, Stevens called his counterpart in Germany, Fritz Leitner.

 “He said, ‘You need to change to radial tires and use cast wheels from the civilian side,’ but we’d already proofed out run-flat bias-ply tires on spoked wheels that were really good on potholes,” Stevens said. “Thank goodness [local Sacramento dealer] A&S had a bunch of RTs in the showroom. We grabbed the wheels and installed the Dunlop tires with the stiffest sidewalls, so they’d pass the run-flat test, but then the speedo drive was wrong, the center stand was wrong, and the side stand was wrong, so we had to change all that, too. It passed the test, and they loved it, but I told them they were going to bend some wheels hitting potholes. They said they didn’t care, but after they’d bent about 150 wheels, they started to rethink that!”

A&S had been a BMW dealer since 1988, and the firm had won the contract to supply the CHP with motorcycles thanks in part to its location in Roseville, just outside Sacramento. “There were only a couple of dealers that had the capability of doing that contract,” Stevens said. “You have to have a lot of staffing, a big facility, and a lot of money to buy these things and wait for the state to pay you.”

A&S delivered the earlier K 75s to the CHP, then fulfilled the larger order of R 1100 RT-Ps. “We built all of the original bikes, like 25 a month,” said Howard Pine, son of A&S founder Sheldon Pine. “We loaded up truck after truck, and we never had a bike damaged in transit.”

Following delivery, A&S’ role was like that of any BMW dealer in California. “Each CHP office had their bikes serviced by local dealers, and BMW NA handled the buy-back operation,” Pine said. “Every dealer had the option to buy those used bikes from NA for local sales, so they got spread across the state.”

Though the BMWs required less maintenance than the Kawasakis—fluid changes took place every 6,000 miles rather than 3,000 or 3,500 miles, while shaft drive eliminated the need for chain adjustment or replacement—that was mitigated by the significant mileage each bike accumulated. “I think the record was 60,000 miles in 17 months,” Stevens said. “A lot of the bikes would reach the 60,000-mile limit in 24 or 30 months, so they moved the limit to 80,000 miles, then 100,000 and 120,000.”

The need for frequent maintenance was a boon to local BMW dealers. “It’s a wonderful boost to the dealer service business,” Stevens said. “If officers were fortunate enough not to pick up a nail, they’d still wear tires out within 4-6,000 miles, depending on how the officer rode, and they’d have to look at the brake pads at every service, because they go through brakes much faster.”

BMW could sell plenty of parts, which helped to make the program profitable despite the buy-back clause. The program also brought new customers to the marque, as the officers who rode BMWs on duty bought BMWs as personal transportation.

“They discovered how well BMW dealers take care of their customers, which created a bond of loyalty that certainly didn’t exist with Kawasaki,” Stevens said, noting that CHP officers were also given a discount on BMW’s civilian bikes. “They experienced a relationship that radiates through all of the people within their orbit of influence, and it really did contribute noticeably to sales of motorcycles in California.”

In 2001, the civilian R 1100 RT models were superseded by the R 1150, which itself was followed in 2004 by the R 1200 RT and in 2019 by the current R 1250 RT. Each of those was offered as an RT-P Authority bike a few years later, with upgrades to its chassis and drivetrain that benefitted officers just as they had civilians. (Though BMW offers a full range of Authority models, including scooters, US agencies prefer the boxer-engine RT-P over the parallel twins or scooters used elsewhere.) Electronic engine management, for instance, allows the BMWs to use regular fuel where the Harleys and Kawasakis require premium. “The officers have to buy fuel from retail stations, and BMW’s knock sensors allow it to tolerate regular fuel that saves thousands of dollars a year in fuel costs,” Stevens said.

The bikes have also benefitted from improvements to their police-specific equipment, much of which was designed by Stevens in New Jersey and then tested by BMW Motorrad in Munich or Berlin. In 2003, for instance, Stevens persuaded the CHP to stop reusing its old sirens and lighting systems in favor of modern, better-integrated equipment, as well as updated wiring systems for radio and radar. “They loved that idea, and we were really able to bump our volume with sirens and lights,” Stevens said. A freewheeling alternator, meanwhile, improved the longevity of the drive belt, while a throttle stop prevented cables from breaking when officers twisted the grip too forcefully. More recently, Stevens developed holsters that allowed CHP officers to carry not just their duty pistols but their duty rifles on their motorcycles as well.

The California Highway Patrol loved the BMWs, but the program didn’t continue without interruption. Under Governor Arnold Schwarzenegger, the CHP began buying Harley-Davidsons, newly equipped with ABS. Even so, the CHP continues to add new BMWs to its fleet, though the buy-back provision no longer applies. So do other agencies throughout the US, many of which piggyback on the State of California’s approval process when supplying their own fleets. Today, about 3,500 R 1250 RT-P motorcycles are in service in this country, used by more than 500 state and local police forces including the Los Angeles Police and Sheriff’s Departments, the City of Phoenix and the Arizona Department of Public Safety, the City and County of San Diego, the cities of Anaheim and Fresno, and the Honolulu Police Department. 

—End—

In the 1930s, the sporty and sophisticated 328 made BMW synonymous with roadsters. Sixty years later, the Z3 made BMW synonymous with roadsters once again, with sporty performance and styling that recalled its legendary predecessor. It became one of BMW’s best-loved cars, bringing new enthusiasts to the marque and inspiring pilgrimages to the factory in South Carolina where it was built.

The Z3 wasn’t BMW’s first roadster of the modern era. That distinction belongs to the Z1, a concept car from BMW Technik that became a surprise hit after it was approved for limited production. Built from 1989 to 1991, the Z1 boasted futuristic styling, an aluminum chassis, and a list price that equated to about $45,000, yet BMW had no trouble selling 8,013 examples in its European markets.
The Z1’s success proved the viability of the roadster segment, at least among well-heeled enthusiasts. At the other end of the spectrum, Mazda’s Miata did the same at one-third the price. Following its debut at the 1989 Chicago auto show, the peppy Miata caught on quickly. In 1989, Mazda sold 45,236 of its diminutive Miatas in the US, and in 1990 it sold 95,640 more.
While Miatas were flying out of dealer showrooms, BMW designers in Munich were engaged in a styling exercise dubbed “Fun Car.” That prompt inspired 33-year-old Joji Nagashima to sketch a two-seat roadster. “It looked a bit like a 328, a retro design,” Nagashima said. “I don’t think a roadster can be a modern type of car.”

Nagashima’s sketch became a clay model, and then it was selected for further development alongside another concept from BMW Motorrad. The motorcycle division was then led by Dr. Burkhard Göschel, an engineer with a knack for blending tradition with innovation. Motorrad’s roadster took its four-cylinder engine and chassis parts from the E30 3 Series, but it was otherwise unconventional. “It was a basic roadster with detachable door side panels and a detachable trunk cover,” Göschel said. “You could have used it as a roadster pickup!” 
The success of the Miata had bolstered the business case for a new BMW roadster, which found a strong champion in Dr. Wolfgang Reitzle, then BMW Board Member for Research and Development. In 1992, Reitzle presented three models—Nagashima’s Fun Car and the Motorrad concept, plus one other—to his fellow board members. The board chose Nagashima’s car for its styling and Motorrad’s for its creativity and passion; for production, the two would be combined.
Though it wouldn’t be as cheap as a Miata, the Z3 would be built on a limited budget and sold at an affordable price. “I was told to do the car as a ‘first BMW,’ not as a serious sports car,” Nagashima said. “The car was supposed to be a compact, fun-to-drive city commuter for DM 40,000 ($25,000).”
Göschel received the same brief. “The approach was unchanged from that of BMW motorcycles. It should be a fun-to-drive, entry-level BMW. Cost should be kept low, since it’s only for fun, and we needed to make it simple and easy to handle.”
That meant a four-cylinder engine, at least in the beginning, and a chassis based on the new E36 3 Series but with a ten-inch shorter wheelbase. Rather than the E36’s new multilink Z-axle, the roadster would use the more compact (and cheaper) semi-trailing arm rear suspension from the outgoing E30 3 Series, which provided less mechanical grip. “Using the E30 suspension/axle concept made the Z3 a lot of fun to drive,” Göschel said.
While the Z3 was under development in Munich, the question arose of where it would be produced. The Miata’s success in the US indicated a strong market for roadsters in this country, and BMW just happened to be setting up a new production plant in South Carolina.

“That car pops up, and [Bernd] Pischetsrieder was the Chairman of the Board,” said Carl Flesher, BMW Manufacturing’s first Head of Public Relations. “He said, ‘This looks like what we should be building over there. Adding to the brand, not just repeating what we’re already building. Make it sporty and fun.’ That ended up being the right decision.”

With that, Göschel was put in charge of the entire Z3 project. “I got the whole responsibility of developing the car, setting up production, creating a totally new supply base, and integrating it into BMW,” Göschel said.

The first Z3 rolled off the production line at Spartanburg in September 1995, and two months later it made its public debut in GoldenEye, the first film in which James Bond traded his Aston Martin for a BMW. It was an ingenious bit of product placement negotiated for BMW by Tom McGurn during his stint as BMW’s West Coast Communications Director.

“We had a product placement agent in Southern California, Norm Marshall and Associates,” McGurn said. “One day he asked if I’d been reading that James Bond was coming back after a five-year lag between Bond films. He said, ‘Why don’t we give it a go?’ It was as simple as that.”

The fictional British agent had long been identified with Aston Martin, but the producers were intrigued by the prospect of a switch when McGurn showed them a photo of a BMW roadster concept. “We talked about how it was a new Europe, one in which borders didn’t matter. The European Community had been formed in 1993, and they could use a European car that was going to be built in America.”
BMW had never paid for product placement, and the company had no intention of doing so even in a Bond film. “[V.P. of Marketing] Jim McDowell got involved, and we said, ‘We’re not going to spend any money to place the car in the movie, but what we will do is incorporate it into the launch campaign for the car: TV and print, and a number.’” McGurn said. “It was significant enough for them to go ahead with it.”
BMW had script approval to ensure the film would express BMW’s brand values, and it wouldn’t be involved in accidents, and the producers accepted the “minor tweaks” McGurn suggested. In the spring of 1995, the Z3 was shipped under wraps to Puerto Rico, where it would be driven by Pierce Brosnan as James Bond. The car was only on screen for a few minutes, but they were good minutes. “It was a bit of a tease strategy,” McGurn said. “We wanted to expose it but  not overexpose it, and it was perfect in the driving scenes through lush vegetation, with the top down.”

The film premiered at Radio City Music Hall on November 13, 1995. The Z3 wouldn’t go on sale until the spring of 1996, but BMW dealers were able to display several show cars while screening the film for their customers. “Most did it, and there was a tremendous number of pre-orders, something like six months of production,” McGurn said.

“Automotive News called it the best product launch in recent history.”

That December, one hundred lucky customers were offered the chance to purchase an exact replica of James Bond’s Z3 1.9—in Atlanta Blue over a Beige Nappa leather interior, and with “007” on the dash plaque and floor mats, but minus the Stinger missiles and parachute installed by Q in the film—from the Neiman Marcus Christmas catalog.
“In the first five minutes, they had taken over 200 orders, and we had to immediately stop selling” McDowell said. “I remember going to Panke and saying, ‘Well, our idea worked! It worked a little too well, and now we need 200 of those cars [only 100 Bond edition example were ultimately produced]. It was indicative of the extent to which people were getting excited about what BMW was doing in the United States. I think James Bond's new car really repositioned BMW in people's minds as a great driving car, as a brand that was moving forward, and as a brand that was accelerating.”
By the end of 1996, BMW had sold more than 15,000 Z3 roadsters in the US, and the car had inspired a level of devotion not seen since the 2002 erupted onto the scene in 1968. Many who bought Z3s had come to BMW from other marques, but they soon became enamored of the brand as well as the roadster. That year, BMW of North America’s annual sales hit 105,761, topping the 100,000 mark for the first time in company history.
In 1997, the Z3 faithful began making pilgrimages to the Spartanburg factory for the annual Z3 Homecomings organized by Amy and Wayne Lester. Amy had been a BMW owner since 1976, when she purchased a slightly used 2002 that she traded for a 3.0 CS a few years later. She restored that car with Wayne, and it still looked showroom-fresh in 1996, when the Lesters drove it to the Euro Auto Festival at BMW Manufacturing’s Zentrum. It attracted the attention of engineers at the factory, and it provided a strong introduction when the Lesters approached communication manager Walt Behnke about holding an event for Z3 owners over Labor Day weekend in 1997. 
The Lesters didn’t yet own a Z3, but they’d become so obsessed with the car that they formed the Z3 Car Club of America in 1996. “I thought we could get 60 cars, but we had 160 register for it!” Wayne said. They’d promoted it using a new communication tool called the World Wide Web, and a Z3 message board on the Roadfly website.

Where Behnke had assumed the plant would host perhaps two dozen Z3 owners for a plant tour and lunch, it quickly became apparent that a major event was in the works.
“We started planning a party and tech sessions to let engineers and assembly workers see how the cars were doing,” said Kenn Sparks, another Communications Manager who served as event host. “We had a couple of clinics to find out what customers liked and didn’t like, finding out that the sun visors were too small, that the gearshift knob could be better quality, etc. The rework guys put on their own clinic, where they could analyze problems and do a quick repair. BMW started to gain tremendous insight from its customers, and the customers loved the attention.”
So did BMW’s associates and executives, who were treated like rock stars by those who owned the cars they’d created. “I remember introducing Dr. Göschel to a cafeteria full of happy Z3 owners,” said Flesher. “Once they knew he was there, they all ran out to their cars to get the owner’s manual so he could sign it. He sat there until after midnight and signed them all, then he looked at me and said, ‘Americans!’”
The Z3 Homecoming turned into an annual event, renamed the Roadster Homecoming in 2003, when the Z3 was superseded by the Z4 roadster. Well before the last event in 2012, it had become so popular that attendance was capped at 600 cars, and tickets sold out within minutes. “For a long time, it was the largest annual customer event at BMW, and there was nothing else like it anywhere in the world,” Sparks said.

As Homecoming demonstrated, the emotional connection between the Z3 and its owners was profound. “We invited the roadster owners to speak after dinner, and they often told stories about how the little BMW had literally saved their lives,” Sparks said. “One had driven under a tractor trailer in a horrible collision, but was able to get out of the car. We also heard people talk about how much that little car meant to them. One guy had been ill with cancer, and driving his Z3 with the top down helped him overcome it in a way that nothing else had been able to. For those of us in the company, it was a heavy experience, but it was also a tangible demonstration of the value of our work.”
The Lesters got a Z3 of their own in time for the second Homecoming: a six-cylinder Z3 2.8i in the rare color known as Sundown. “It was a limited-production color, with only five cars made and only one a 2.8,” Amy said. “We bought that car in 1998, after it had been a factory VIP and press car for about 8,000 miles.” Twenty-six years later, their Sundown Z3 has covered more than 410,000 miles, as acknowledged in a 2021 exhibit at the BMW Museum in Munich.
It’s probably the highest-mileage Z3 among the 297,088 Z3 and M roadsters and coupes built, and offers a strong testament to the build quality of the cars produced at Spartanburg right from the start. Likewise, the Z3 and Roadster Homecomings offer strong testament to the affection these cars inspired, for BMW and the plant that built them.

“The Homecoming had an enormous effect all across the US, and it was one of the best marketing events even though it wasn’t actually a marketing event but was totally spontaneous,” Sparks said. “It was absolutely authentic and genuine, and it got customers talking about these BMWs that were made in the US.”
—End—

In 1975, Ammirati & Puris proclaimed BMW “The Ultimate Driving Machine,” setting off one of the greatest ad campaigns of all time. The synergy between the agency and BMW of North America saw BMW’s US automobile sales increase nearly fivefold over the next decade, a remarkable achievement. As the 1980s wore on, however, the fabric began to fray. The rising value of the Deutschmark made German cars more expensive in the US just as a wave of affordable luxury cars was arriving from Japan. From a high of 96,759 cars in 1986, BMW of North America’s sales fell to just 53,343 cars in 1991.

Was advertising to blame? Probably not, but any creative relationship can become stale over time, especially when it’s subject to pressure from above. BMW NA’s advertising independence had never sat well with the parent company in Munich, which had long defined its cars with “Freude am Fahren,” or “Driving Pleasure” and preferred its subsidiaries to do the same.

“The request to get rid of Ammirati & Puris was emanating from Munich,” said Carl Flesher, then BMW of North America’s Vice-President of Marketing. “They felt we needed fresh thinking in terms of advertising, and there was even a request of me to drop The Ultimate Driving Machine [tagline]. I refused. I fought for Ammirati & Puris, saying they are an excellent agency, they have a feel for the brand, and advertising is not going to turn this business around. It’s got to be through product and pricing.”

Nonetheless, Flesher knew that advertising remained critical. “I had Harvard do a study on what happens when companies put an enhanced effort into their marketing when sales are off like that. They showed unequivocally that when demand goes down, companies that invest in themselves the most come out first, and go higher.”

With sales dropping precipitously, BMW of North America made major personnel changes in its executive suites. Flesher left NA to become Head of Public Relations for the nascent BMW Manufacturing, and he was replaced as Head of Sales and Marketing by Victor Doolan, CEO of BMW Canada since 1987. “Soon after I arrived in the US, Karl Gerlinger, who was President at the time, was clearly instructed by BMW AG to replace the agency,” Doolan said. “As I was in charge of Sales and Marketing, I agreed to tell the agency.”

On October 27, 1992, Doolan and McGurn went to the Ammirati & Puris offices in Manhattan.

“Only Marty [Puris] was there, and we told him we were putting the account up for review,” McGurn said. “He reacted fairly calmly, matter-of-factly. Then, as we were leaving, Ralph [Ammirati] came in. We were preparing to announce the review the next day, and we had invited journalists to the BMW Gallery in Manhattan. That night, or first thing the next morning, Ammirati & Puris had resigned the account, very publicly.”

Puris called BMW’s move a “blindsiding,” and he told The New York Times that his firm wanted nothing to do with a review. That left the field wide open for new candidates, which by mid-December had been narrowed from 30 agencies to five: Earle Palmer Brown in Bethesda, Maryland; McCabe & Company in New York; McCaffrey & McCall in New York; Mullen in Wenham, Massachusetts, and TBWA in New York. McGurn told The New York Times that the agencies would be asked to develop a campaign to introduce “an undisclosed new BMW model that is scheduled to be introduced next summer.”

In February 1993, Mullen was announced as the winner. “Everyone I’ve spoken to says it was Jim Mullen himself who won the account,” said Patrick McKenna, who worked on the BMW account as a young marketer at DeWitt Media. (Following the split with Ammirati & Puris, BMW NA divided the media and creative responsibilities between two agencies.) “His office was like a former convent, and he had his classic car collection out front. Supposedly he was crying as he made his pitch—that’s how emotional he was about the account.”

Alas, Mullen’s emotion couldn’t compensate for unexceptional work from his 150-person staff, who might not have been as passionate about cars as Mullen. “They didn’t have the creative chops the brand needed,” McKenna said. Doolan concurred. “They worked hard, but the magic was missing.”

The relationship lasted just 25 months before Mullen was dropped as BMW NA’s agency of record, effective July 1, 1995. The move was announced by BMW NA’s new Vice-President of Marketing, Jim McDowell, who’d taken that post when Doolan was elevated to President in 1993. In explaining Mullen’s dismissal to The New York Times, McDowell was diplomatic: “Mullen was instrumental in moving BMW away from its late-1980's ‘yuppie’ imagery to the industry-leading ‘smart choice’ reputation the company enjoys today.”

Indeed, BMW of North America had begun to climb out of its sales slump even before Mullen took over, but McDowell credited the firm with helping BMW NA increase its annual sales from 78,010 cars in 1993 to 84,501 in 1994. That was a good start, he told the Times, “but now we’re talking more about integrated marketing, interactive marketing, and for that we need some additional skills."

McDowell found those skills in Minneapolis, at the Fallon McElligott agency he’d encountered as Porsche Cars North America’s planning director from 1985 to 1990, and after that as Porsche AG’s Director of Marketing. In March 1993, McDowell was lured to BMW by Helmut Panke, then Head of BMW AG’s Group Planning Division in Munich. A month later, Panke replaced Gerlinger as CEO of BMW (US) Holding Corp., and he brought McDowell with him to New Jersey.

Mullen’s advertising for BMW NA may have been effective, McDowell told The New York Times, but it had “seemed at times a little too distant, a little too aloof. We want to make it a little more accessible in a friendly way."

Making BMW less aloof meant making BMW’s advertising funnier, a task to which Fallon McElligot was perfectly suited. “They had a great sense of humor, and they were prepared to be a little bit in-your-face” McDowell said, “A lot of people there were very familiar with the product already—there were probably five times as many BMWs in the car park as Porsches—and everyone on the creative side had gasoline in their veins.”

The agency’s appointment coincided with the debut of the all-new Z3 roadster in the James Bond film GoldenEye. Fallon McElligot took the opportunity to lampoon British institutions with an ad entitled “Parliament,” in which bewigged lords express outrage that “Bond is driving a BMW…on the wrong side of the road!” In another television spot, various Brits were seen reading classified ads for Bond’s old Aston Martin, complete with missiles and ejector seat. “I wonder what he’s getting instead?” they ask, as the ad cuts to Pierce Brosnan as Bond, driving a Z3 in GoldenEye.

The GoldenEye connection allowed Fallon McElligot to create Bond-themed material for use by BMW dealers and direct-mail campaigns to customers. Additional Bond tie-ins were presented via BMWUSA.com, then a relatively new medium that Fallon McElligot redesigned “to perform like a BMW,” according to the agency’s President of Integrated Marketing, Mark Goldstein. That included downloadable sound effects, one of which was a recording of the M3’s engine.

“Fallon was brilliant, creatively brilliant,” said McKenna, who joined BMW NA’s marketing team in 1997. “They were also their harshest critics. They looked at their ads for the Bond Z3 and said, ‘We need to do better. We need something uniquely BMW.’”

One of the first ads to result from that self-criticism was created with cutting-edge digital effects from Northern California studio Industrial Light & Magic. The ad showed a penguin trying to scale an icy hill but sliding backward before reaching the top. Shaking its head after a second attempt, the penguin disappeared, an engine fired up offscreen, and the penguin’s wing turned on the radio on a BMW dashboard. To a Latin beat, a 3 Series sedan climbed the hill with ease. “BMW traction control. Because we all have places to go.”

The ad was clever, as McDowell had intended, but Fallon’s next series of ads traded humor for a different kind of emotion. Stunningly filmed in black and white and backed by up-tempo electronic music, the ads highlighted the connection between a BMW and its driver. An ad for the Z3 declared, “Science. Technology. All worthless. Unless they make you feel something.” An ad for the 5 Series proclaimed the “love triangle” between the car, its driver, and the road.

“The ads were shot from the point of view of the driver on windy roads,” said McKenna, who was on hand during production. “The camera technique gave the ads a visceral feeling that had never been captured before, and each one was a work of art. They were created at a lot of expense, shot in California, and retouched in London. Every line in the copy was labored over. They paid painstaking attention to every detail.”

Fallon McElligot was outlandishly creative, and the agency found a synergy with BMW that surpassed even that of Ammirati & Puris. “They really understood the marque, and it was epitomized, at least for me, with the Z3 ad that said, ‘Happiness is not around the corner. Happiness is the corner,’” Doolan said.

Along with shooting ads from the point of view of the driver, Fallon McElligot changed the notion of who that driver might be. “Another thing we started doing is showing women driving the cars in the advertising,” McDowell said. “Back in the days when we sold 50,000 cars a year, a huge plurality of them were to men. We were perceived as a man’s car. Subtly opening up to things like having women in the photography and advertising in places that women would notice without being overly pandering were important. As we went beyond 100,000 cars per year [in 1996], a huge part of that growth was women.”

In 2001, the relationship between BMW NA and Fallon reached its apex with BMW Films, a groundbreaking series of eight short films by A-list directors like John Frankenheimer, Guy Ritchie and Wong-Kar Wai. Starring Clive Owen as The Driver ferrying celebrities including Madonna, BMW Films premiered over the World Wide Web, then only a decade old and barely capable of handling the download of each film. The Hire pushed the limits of the Web, and it expanded the boundaries of what automobile marketing could be. BMW Films were immediately recognized as works of marketing genius, and they helped propel BMW NA to annual sales of 213,127 cars in 2001.

It was a tough act to follow, even for its creators. “When we went back to conventional advertising, we were finding ourselves back into that cycle of needing to push and push to try to get something that breaks through the clutter,” McKenna said.

In early 2005, McDowell left his post as Vice-President of Marketing to swap jobs with Jack Pitney, the first Head of MINI USA. Despite the excellence of Fallon’s work, Pitney put BMW NA’s advertising account up for review that June. “Jack was so focused on change” McKenna said. “and I think when you come in as a new Chief Marketing Officer, there’s definitely a desire to put your own thumbprint on the brand.”

In addition, McDowell said, BMW AG was pressing NA to participate in a global marketing campaign rather than create its own. “There was a strong desire to have more worldwide unity, and it became increasingly likely that we would be sharing materials with Germany and other markets,” he said.

Like Ammirati & Puris in 1992, Fallon—by then known as Fallon Worldwide, having become part of the Publicis group in 2000—declined to participate in the review process. Thus ended one of the most fruitful creative partnerships of the late 20th century, and the second in BMW of North America’s thirty-year history.

—End—

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SLIDE 2: BMW Group Quarterly Statement to 31 March 2025

Ladies and Gentlemen,

Good Morning.

In a highly dynamic environment, the BMW Group has delivered sales and profitability for the first quarter in line with expectations.

Our core business has a strong foundation of highly attractive products and is well diversified. With a balanced presence in our sales regions, we have a strong competitive position and are able to deliver a consistent performance.

In the first quarter, the BMW Group proved this once again.

SLIDE 3: BMW Group Performance in Q1 2025

Let’s take a detailed look into the key figures for the first quarter.

Group earnings before tax totalled over 3.1 billion euros.

Based on Group revenues of 33.8 billion euros, this resulted in a Group EBT margin of 9.2 percent.

The EBIT margin in the Automotive segment came in at the upper end of our 2025 annual target corridor with 6.9 percent.

Excluding the depreciation resulting from the purchase price allocation of BBA, the margin was 8.1 percent.

Global retail sales decreased slightly by 1.4 percent compared to last year’s first quarter.

Sales of all-electric vehicles increased by 32.4 percent, which represents a share of 18.7 percent of total sales.

SLIDE 4: Automotive Retail Units, BEV Units, Auto Revenue and Auto EBIT

Here you can see how the Automotive Segment performed across key metrics.

In the first quarter, the BMW Group delivered just over 586,000 BMW, MINI and Rolls-Royce vehicles to customers, a slight decrease of 1.4 percent compared to last year’s first quarter.

While the BMW brand was slightly down 2 percent year-on-year, the MINI brand benefited from the full availability of all models and reported a growth of 4.1 percent.

Group sales grew across all regions except China.

Here, the lower run-rate of the second half of 2024 has carried over into the first quarter of 2025, as expected.

The sales development in the Chinese market in Q1 was also impacted by the model changeover of our important BMW X3 and operational challenges in certain areas of the dealer network.

In Europe, the BMW Group increased retail sales solidly by 6.2 percent.

The order intake for BMW vehicles in the region across our entire product portfolio is strong, with an order bank reaching well into the third quarter.

In particular, BEV retail sales grew by 64.2 percent in Europe, confirming the region’s crucial role in driving our electrification strategy.

In the US, year-on-year retail sales grew by 4 percent.

Our commitment to electrification remains an important cornerstone of our strategy. And the demand for our all-electric vehicles remains strong.

In the first three months, the BMW Group delivered almost 110,000 all-electric vehicles to customers worldwide, representing a significant growth of almost a third (32.4 percent).

The share of our all-electric vehicles amounted to 18.7 percent of total sales.

Our electrified vehicles – meaning BEVs and plug-in hybrids –accounted for almost 27 percent of total sales.

With our comprehensive and compelling line-up of electrified vehicles we remain confident that we will meet our CO2 emission targets in the EU for 2025.

Automotive Segment revenues amounted to 29.2 billion euros and were moderately lower than in the same quarter of 2024, mainly due to lower vehicle sales to dealers.

Segment EBIT for the first three months was 2 billion euros, with an EBIT margin of 6.9 percent.

Let’s now have a detailed look at the year-on-year changes in the operational result on the next slide.

SLIDE 5: Automotive Segment EBIT in Q1

Auto EBIT declined by around 700 million euros compared to the first quarter of 2024.

Changes in currency and raw material positions accounted for a positive impact of around 100 million euros.

The net balance of volume, model-mix and pricing effects was a headwind of 900 million euros compared to the first quarter of 2024.

The pricing headwind compared to Q1 2024 reflects the global price environment and especially the challenges of the highly competitive Chinese market.

In China, the price levels of the second half of 2024 continued into the first quarter, as expected.

Accordingly, Q1 revenues per vehicle in the Automotive segment were below the level of Q1 2024.

For the full year, they are expected to be in line with last year’s level.

Ladies and Gentlemen,

I emphasized at our Annual Conference that for the year 2025, not only R&D expenditure and capex, but also operational costs will decrease compared to 2024.

Our Q1 results provide first evidence for this cost decrease in nominal terms, covering the effects of inflation.

Research and development expenses were around 200 million euros lower than in Q1 2024.

Based on Group R&D expenditure, the R&D ratio according to the German Commercial Code came in at 5.9 percent.

Sales and administrative expenses also decreased year-on-year by about 200 million euros, mainly due to lower IT costs.

In Other Cost Changes, the headwind of 300 million euros essentially results from two topics:

• The income from the resale of end-of-lease vehicles was lower than in the first quarter of 2024, yet remains positive on average across the portfolio.
• The anti-subsidy tariffs imposed by the EU Commission on electrified vehicles from China impacted EBIT in the low three-digit million euros range in Q1.

The other tariff increases only started to come into effect from early March and therefore had minimal impact on the Q1 results.

SLIDE 6: Automotive Segment Free Cash Flow in Q1

Free cashflow in the Automotive Segment totalled about 400 million euros in the first quarter of 2025.

Segment EBT amounted to 1.9 billion euros, which is 800 million euros lower than in the first three months of 2024.

The net change in working capital contributed around 100 million euros to free cashflow.

Inventories rose during the first quarter, as production exceeded retail sales and wholesale volumes.

While this is typical first quarter seasonality, this year’s Q1 stock increase is much less pronounced than in previous years.

The impact of increased inventories as well as of higher trade receivables was compensated by the development of trade payables, which increased also due to higher production levels.

The net effect from capital expenditure and depreciation reduced free cashflow by 600 million euros.

This includes a positive component with invest lower than depreciation in the first quarter.

On the other hand, it also incorporates a higher cash outflow of 964 million euros in Q1, which is related to the capex peak in the last quarter of 2024.

Capital expenditure for January to March amounted to around 1.2 billion euros, a year-on year reduction of around 100 million euros.

The capex ratio for the first quarter was 3.6 percent.

For the full year 2025, capex will decrease compared to 2024, with an expected capex ratio below 6 percent.

The development of provisions reduced free cash flow by 200 million euros.

The change in the position other, which includes regular tax payments, led to a reduction in free cashflow of around 800 million euros.

For the full year, the BMW Group is targeting a free cashflow above 5 billion euros in the Automotive segment.

At the end of the first quarter, the Automotive net financial assets came in at 45.5 billion euros, which is around the same level as at the end of 2024.

This provides a solid foundation to navigate the current challenges in global markets.

And it enables us to distribute our Automotive Free Cashflow via dividends and share buybacks.

Ladies and Gentlemen,

The BMW Group remains committed to its shareholder return strategy, which includes both dividend payments and share buybacks.

On April 3rd, we successfully concluded the fourth and final tranche of our second share buyback program.

With completion of this program, we have repurchased shares valued at 4 billion euros since the start of our share-buyback authorization in 2022.

This corresponds to a reduction in share capital of over 7 percent.

At the upcoming AGM, the Board of Management of BMW AG will propose an agenda item, seeking a new five-year authorization to acquire treasury shares amounting to up to 10 percent of share capital.

SLIDE 7: Financial Services Segment in Q1

Moving on to the Financial Services Segment.

The number of new contracts concluded with retail customers decreased slightly by 4.6 percent year-on-year to reach almost 403,000 contracts.

For new vehicles, new business units were on par with last year’s quarter.

Consequently, the penetration rate for lease and loan offerings increased by 1.2 percentage points to 43 percent.

For used vehicles, new business units decreased moderately, due to the lower number of end-of-lease vehicles that were returned compared to the first quarter of 2024.

New business volume grew by 2.4 percent to 16 billion euros, driven by a higher average financing amount per contract.

Segment earnings for the first quarter amounted to 650 million euros, a year-on-year decrease of 80 million euros.

This results mainly from two factors:

• The lower income from the resale of end-of-lease vehicles due to reduced average gains per unit.
• And the lower number of returned vehicles compared to 2024.

The credit loss ratio across the entire loan portfolio remained at a low rate of 0.23 percent.

SLIDE 8: Motorcycles Segment in Q1

In the Motorcycles Segment, first-quarter deliveries decreased slightly by 3.9 percent year-on-year.

EBIT for the first three months totalled 76 million euros, with an EBIT margin of 9.4 percent.

SLIDE 9: Outlook 2025

Ladies and Gentlemen,

Let’s move to our outlook for 2025.

Our guidance given at the Annual Conference on March 14th included all the tariff increases in force as of March 12th.

Since then, political and macroeconomic volatility has increased even further.

Due to ongoing developments and negotiations, the expected effects from tariffs on 2025 results can only be estimated based on certain assumptions.

So, we have taken the latest impact as of May 5^th, meaning tariffs on US imports of CBU (= completely built up) and non-USMCA components at an additional 25%. But on the other hand, the executive order from last week regarding non-stacking and the eligibility of 3.75% of MSRP for the Spartanburg production volume has some positive impact, given our strong local footprint in the US.

And the extremely high tariffs for imports from the US to China are neglectable, given we also have a strong local footprint in China.

In particular, the localization of the X5 in 2022 helps mitigating.

And still, the tariff increases that started to come into effect from early March will have a notable impact on the Q2 results.

We assume that some of the tariff increases as of May 5th or up to May 5th will be temporary and that there will be reductions from July 2025.

Our guidance also includes measures to mitigate the impact of higher tariffs.

Based on these assumptions, our guidance parameters for the full year remain unchanged.

Group earnings before tax are expected to be at previous year’s level.

In the Automotive segment, we are forecasting a slight increase in deliveries.

The EBIT margin is expected in a corridor between 5 and 7 percent.

The EBIT margin in the Motorcycles Segment should come in at between 5.5 and 7.5 percent.

In the Financial Services Segment we are targeting a Return on Equity (RoE) in the range of 13 to 16 percent for the full year.

SLIDE 10: Q1 Performance in Line with Expectations

Ladies and Gentlemen,

The BMW Group delivered as expected in the first quarter with an EBIT margin at the upper end of our full-year target corridor.

The geopolitical and macroeconomic uncertainty has reached a level we have rarely seen before.

We are closely monitoring the impact of the current macroeconomic conditions on consumer sentiment.

It is therefore all the more important that we continue to follow our long-term strategic plan.

This includes using the flexibility of our global network to mitigate the impact of the current developments.

And it includes disciplined spending – be it R&D, capex or operating costs.

As we walk the talk, nominal cost reductions are already visible in our Q1 figures.

Our clear long-term strategy, our strong brands and products and the high level of cost discipline throughout our entire organisation remain the basis for our long-term financial success.

Thank you.

- Check against delivery –

Ladies and Gentlemen,

As a global player, the BMW Group operates within the current tensions of world politics. Like many sectors of the global economy, we are adjusting to a new reality – one in which abrupt changes in external conditions often have far-reaching consequences, not just for our industry.

In these circumstances, it is critical not to get caught up in the public frenzy or rush into hasty actions. That is why we continue to focus on our long-term strategic course with pragmatism and flexibility.

And this approach is proving its value: Despite the volatile conditions, the BMW Group has started 2025 in line with our expectations.

There are three main reasons for this:

First, our fresh and attractive product line-up across all drive technologies – which helped us achieve a robust performance, especially in Europe and the US.

Second, continued strong sales growth for our all-electric vehicles.

And, third, a high standard of cost discipline across the company.

All of this meant that, despite various influencing factors, our profitability for the first quarter was in the upper half of our guidance.

Let's take a closer look at the details:

In all major sales regions outside of China, we increased our sales, compared to the same period of last year. Excluding China, sales grew by almost six percent (5.9%).

This confirms the effectiveness not only of our product strategy, but also of our technology-open approach. Our vehicles are in demand, across all types of drivetrain.

We saw particularly good growth in Europe and the US – with sales in Europe up solidly by more than six percent and an increase of four percent in the US.

We are growing steadily across the entire Americas region, with growth of over 5 percent. We are also growing overall in our markets outside Europe, America, and China by 15 percent. Thanks to our strong performance in other markets, we were able to nearly offset the persistent challenges in the Chinese market.

We have the right products on the market at the right time. Our wide range of all-electric vehicles across all brands allows us to take full advantage of the growing demand for pure electric vehicles.

The more than 32-percent increase in BEV sales underlines the strong appeal of our electric vehicles. Above all, high demand in Europe fuelled this growth in BEVs. Here, sales of fully-electric vehicles climbed by more than 64 percent year-on-year. E-mobility “made by BMW” is also gaining popularity in the US, with sales up by more than 23 percent.

Nearly one in five vehicles sold by the BMW Group is now fully-electric.

The total share of electrified vehicles – that is, pure electric cars plus plug-in hybrids – now exceeds 25 percent.

MINI, in particular, is benefiting from the strong demand for all-electric vehicles. Today, an electric heart beats in one out of every three vehicles built by the brand. With all models of the New MINI Family now fully available, the brand recorded sales growth of four percent. In China, locally-built electric models played a key role in the brand’s growth of over 18 percent.

The share of fully-electric vehicles in total sales is especially important for meeting European CO2 targets. In 2024, the BMW Group once again significantly outperformed its European CO2 fleet target. Based on internal calculations, our numbers came in at under 100 grammes per kilometre in the WLTP cycle for the first time. We are confident that we will meet the original legal requirements this year as well.

In addition to the growth in all-electric vehicles, we also benefited from continued high demand for our sporty BMW M models – with sales up 5 percent in the first quarter. High-performance models such as the two BMW M5* variants and the BMW M3* were the main growth drivers.

Ladies and Gentlemen,

The first quarter of 2025 highlighted our company’s ability to seize opportunities in a challenging environment and to successfully defend our position in the marketplace.

Looking ahead, new orders across all drive technologies give us every reason for confidence – especially in Germany, where we are seeing significant growth.

Nevertheless, 2025 remains a year of high volatility. We are closely monitoring developments and preparing for different scenarios. This will enable us to respond flexibly and quickly to changing circumstances. We remain firmly committed to deliver robust results and to meet our ambitious annual targets.

Free trade and international cooperation are important drivers of growth and progress. They have always guided our actions. In trade conflicts, on the other hand, nobody wins. All sides should therefore avoid a spiral of isolation and trade barriers, and instead promote growth, progress and innovation worldwide.

We are advocating for this at various political levels in our markets. Thanks to our international footprint and strong, long-term commitment in various countries, we enjoy a high level of credibility. That is why people listen to us attentively and our arguments are well received.

Ladies and Gentlemen,

It is especially important in challenging times that we continually assess the situation in our markets and regions. That is why I have spent significant time in the past few months gathering information about the situation on the ground in our most important markets.

Just two weeks ago, I was at Auto Shanghai. This trade show provides a valuable indicator for current trends – especially for the Chinese market.

One of the highlights was the world premiere of our BMW Vision Driving Experience, or VDX for short. This is the most powerful development prototype BMW has ever built. The key data speaks for itself:

• 18,000 Newton meter of torque.
• 1.2 tonnes of Downforce.
• Lateral forces of up to 3 g.

These are the kind of numbers you usually only see in top-of-the-range racing cars.

The VDX is a pure test vehicle, designed to push the limits of driving physics. However, many of its technologies will be used in our NEUE KLASSE.

In particular, the VDX showcases the performance capabilities of our “Heart of Joy” – one of four high-performance computers that will control key functionalities, such as driving dynamics, automated driving and infotainment in our NEUE KLASSE.

The “Heart of Joy” clusters all drivetrain and driving dynamics functions in a single, standardised electronic control unit. In combination with our dynamic performance control system – which was developed entirely in-house – we are redefining the BMW brand’s most fundamental core characteristic.

We are creating “the next level of Sheer Driving Pleasure”.

We demonstrated exactly what this means with an incredible live performance in Shanghai. For this purpose, we built our own test track with a massive ramp.

The public and trade press were more than impressed with the performance and possibilities unleashed when we combine our decades of experience in driving dynamics with cutting-edge control technology. This is something only we at BMW can do.

Our customers will benefit directly from this – because a system that can manage forces like these can also handle everyday operations with ease: not just in terms of agility and driving stability, but also efficiency and comfort.

Towards the end of the year, series production of the NEUE KLASSE will begin at our new plant in Debrecen, Hungary – starting with the BMW iX3*, which will celebrate its world premiere at the IAA MOBILITY in Munich.

After that, the rollout will continue in rapid succession. In 2026, production of a sporty sedan at the heart of the BMW brand will get underway at our main plant in Munich.

We are deliberately launching the NEUE KLASSE in high-volume segments, so that our innovations can immediately have a broad impact.

Between now and 2027, we will release more than 40 new or updated BMW models onto the market – from BEVs, to plug-in hybrids, to vehicles with combustion engines. All of these will benefit from the technologies of the NEUE KLASSE – and, of course, from the new design language as well.

No other manufacturer has a project as comprehensive and ground-breaking as ours ready for production.

Ladies and Gentlemen,

With its broad product portfolio across all brands, its technology-open approach and highly flexible production network, the BMW Group is in an excellent position to exploit growth opportunities as they arise.

Thanks to our global footprint, we are also able to respond quickly to changes in individual regions, as well as challenges around the world.

We will continue to build on these typical BMW strengths in future.

Thank you.

The American automobile market loves high performance, and it also loves low prices. That paradox presents a challenge for any automaker, but it’s not insurmountable. All it takes is a willingness to adapt, and some creative engineering, as evidenced by the E36 M3 that arrived on these shores in 1995.

BMW M began developing the E36 M3 in 1989, two years before the launch of the series-production E36 3 Series coupe that would form the basis for this high-performance variant. The first-generation E30 M3 was still in production, and still winning races, but BMW M wanted to evolve the model from a pure homologation special into a high-performance road car that could nonetheless compete successfully in the Deutsche Tourenwagen Meisterschaft, or DTM.

Naturally, the requirements of racing were taken into consideration during the E36 M3’s development, and the new car’s S50 six-cylinder engine was a technological masterpiece. Designed under the engineering leadership of Paul Rosche, the engine used a two-piece head with four valves per cylinder, shim-under-bucket valve adjustment, step-free VANOS variable timing on the intake camshaft, and six individual throttle bodies. Displacing 2,990cc, and with a compression ratio of 10.8:1, the S50B30 delivered 286 horsepower at 7,000 rpm and 236 pound-feet of torque at 3,600 rpm, enough to propel the car from zero to 100 km/h (62 mph) in 6.0 seconds. The rest of the car was similarly sophisticated, with stylish aero enhancements by Ulf Wiedhase and Christine Angermann and 17-inch M Double Spoke alloy wheels by Marcus Syring.

Thanks in large part to its exotic engine, the E36 M3 was set to be significantly more expensive than the outgoing E30 M3, which had sold for DM 59,800 when it launched in Europe in 1986. In its second generation, the M3 was expected to cost another DM 20,000, about $11,000 more at the highly variable exchange rate of the late 1980s. For the U.S. market, where BMW NA had struggled to sell the $35,000 E30 M3 in the latter stages of its production run, the new M3 was deemed too expensive.

“I had to be the Lone Ranger in the desert, pointing out to everyone the pricing problems we had with our brand in the U.S.,” said Carl Flesher, then BMW of North America’s VP of Marketing under president Karl Gerlinger. “That, as nice as that car would be, it would be too much money, and no one would see the value and we would have trouble selling it. I said there was no reason in the world to bring a car like that in and then find ourselves having to discount it.”

At that point, none of the M3’s details had been released for public consumption, and it was considered highly confidential within BMW even when the M3’s details were released internally in late April 1992, in a confidential “Pre-Information” document. In June, an even more detailed document was distributed to product planning departments for their assessment, but again this information was not yet made public.

That said, good journalists always cultivate confidential sources, and the BMW Car Club of America had a very good journalist in Bob Roemer. Roemer had spent time in Germany with the U.S. Army, and he’d made friends with a number of BMW insiders. That included Karlheinz Kalbfell, then head of BMW M. (Both men had served as tank commanders, which undoubtedly created a bond that went well beyond their mutual enthusiasm for BMW.) In early January 1992, Roemer spoke with Kalbfell at the Detroit Auto Show, and he reported in Roundel magazine’s March 1992 issue that BMW was “considering not bringing the new M3 to North America and letting the entire M-car concept die here when the current [E34] M5 is replaced.” (M cars had struggled in this market throughout the 1980s, saddled with high prices and oversupplied relative to demand. BMW NA had sold just 1,678 examples of the E34 M5 from December 1989 through April 1993 and had struggled to move the last thousand or so of the 5,300 E30 M3s imported from March 1987 through December 1990.)

At Kalbfell’s request, or at least with his consent, Roemer asked Roundel readers to submit their thoughts on the matter, and he published excerpts from their letters in the magazine’s July 1992 issue. In closing that article, Roemer mentioned that he had presented the letters to Karl Gerlinger, then president of BMW NA, “so that he and his staff could have the full impact of your communications.”

Those communications were thoughtful, and highly detailed. CCA members deemed M cars essential to BMW’s identity as a high-performance marque, but felt the M cars hadn’t been advertised sufficiently. As for what they wanted in an M3, readers specified six-second 0-to-60 acceleration, great handling and brakes, and decent amenities, including leather upholstery on sport seats, air conditioning, and a radio. For that, they’d be willing to pay $35,000, and they thought most of their fellow club members would do the same.

In September 1992, the E36 M3 made its world premiere at the Paris Auto Salon, creating plenty of buzz among enthusiasts worldwide. The car went on sale that month, with its German-market price starting at DM 80,000, or $51,000 at the 1992 exchange rate.

That was far more than U.S. enthusiasts had said they’d be willing to pay, which caused BMW NA executives—led by Gerlinger as president, joined since April 1992 by Victor Doolan, who’d replaced Flesher as VP of Marketing and with additional responsibility for sales—to formally reject the car for the U.S. market following Kalbfell’s M Product Strategy presentation in Woodcliff Lake on December 10-12, 1992.

BMW Canada, on the other hand, agreed to take the car. In February 1993, BMW Canada’s head of Product Planning, Tom Plucinsky (later head of Product Communications for BMW NA) calculated an initial market capacity of 50 E36 M3s, followed by 75 in the second year and a final 30 cars in year three. He requested a show car for the Canadian International Autoshow in Toronto later that month, which generated a brief article by Canadian journalist Jeremy Sinek in Autoweek on March 1, 1993. Sinek’s article created considerable consternation among U.S. enthusiasts who’d just found out they’d be denied the M3 their Canadian counterparts would enjoy. It also generated consternation within BMW of North America, which was outraged at the negative publicity surrounding the decision. NA quickly hit reverse, and at the end of March 1993 the company formally agreed with BMW M’s suggestion to explore an alternate powertrain that would allow the E36 M3 to be sold affordably in the U.S.

Things moved quickly after that. Kalbfell and Rosche had been developing a version of the series-production M50 six-cylinder engine for South Africa, where BMW had offered several parts-bin hot rods, and where Doolan had worked prior to taking positions at BMW Canada and North America. One of those SA specials was the 332, an E30 3 Series powered by the M30 “big six” that had been in production since 1968 and was soon to be retired. A new engine would be needed if South Africa were to offer a similar car on the E36 platform, hence the development of a hotter M50. 

When the modified M50 was up and running, Kalbfell and Rosche demonstrated it to Doolan in Munich. “They drove me to a restaurant in a 5 Series with an M-modified motor they thought could work in an M3 for us,” Doolan said. “Who was I to disagree?”

Automobile magazine put a Dakar Yellow M3 on the cover of its May 1993 issue, above a headline that read “New BMW M3: 286 hp, 155 mph—and it’s coming to America!” The horsepower figure and top speed reflected the specs of the European car, but the M3 was indeed coming to America.

To keep the car’s price within reach of American wallets, the modified M50 would be far simpler and less expensive than the S50. It had a one-piece cylinder head, self-adjusting valve tappets, and a single throttle body instead of six. With a slightly lower compression ratio of 10.5:1, the engine would be less sensitive to octane levels in fuel, a crucial consideration in the U.S. The engine delivered 240 hp at 6,000 rpm and 225 pound-feet at 4,250 rpm—enough to satisfy enthusiasts’ demands for robust 0–to-60 mph acceleration, but not enough to place the car in the most expensive insurance category, which the Euro M3 occupied in Germany. Most importantly, the lower-spec engine would reduce the car’s retail price to $35,800, almost exactly what enthusiasts had said they’d be willing to pay.

“The Germans thought it was heresy to dumb-down a new M product for the U.S., but the difference was 0.2 second from 0 to 60,” said Erik Wensberg, then BMW of North America’s Motorsport Manager.

Because the engine wasn’t considered a “real” M engine within the M division, BMW of North America was encouraged to identify the car as an M330i rather than an M3. BMW NA won that battle, and by August 1993 the U.S.-spec E36 M3 had been defined. On September 8, the launch date was set for November 1, when a select group of U.S. journalists including Bob Roemer would drive prototypes of the car at the Nürburgring.

In March 1994, series production of the U.S.-spec M3 coupe began, and the car was an immediate hit upon its arrival in the U.S. Other than the engine, now designated as S50B30US, the U.S.-spec E36 M3 was nearly identical to its European counterpart, albeit with solid rather than floating front brake rotors, an instrument cluster whose speedometer read in miles per hour rather than kilometers, a tach that indicated a graduated redline, and a fuel economy meter in place of the oil temperature gauge. For the U.S., air conditioning and an Alpine sound system were standard, with the customer’s choice of M cloth/Amaretta suede or Nappa leather upholstery as no-cost options. To accommodate the rougher roads in this country, the M3’s suspension would use slightly softer spring and damper rates than its European counterpart.

By the end of 1995, BMW of North America had sold 8,515 examples, a number that compared favorably with the 11,284 European-spec cars produced from September 1992 through July 1995. Sales were so strong, in fact, that BMW of North America convinced M to offer the M3 with an optional five-speed automatic transmission. From December 1994 to January 1996, BMW NA imported 1,705 automatic M3s. In Canada, meanwhile, the 45 enthusiasts who had pre-ordered their cars took delivery of the Euro-spec M3 in early 1994. After a hiatus year for Model Year 1995, the U.S.-spec E36 M3 would be offered to Canadian customers from Model Year 1996.

Those totals were only the beginning. The M3 came in for major revisions in 1996, getting a larger-displacement, more powerful engine worldwide. In the U.S., the S50B30US was replaced by the S52B32US; based on the new M52 six, this engine displaced 3,201cc and delivered the same 240 horsepower and slightly more torque: 236 pound-feet instead of 225.

Along with the new engine, the 1996 M3 was available in the U.S. as a four-door sedan, that was exclusive to this market, and which proved tremendously popular. It was followed by a U.S.-only convertible in 1998. In the U.S., all three body styles would be available with a five-speed manual or automatic transmission, though U.S. enthusiasts were denied the new six-speed manual and the Sequential Manual Gearbox offered in Europe. Even so, BMW NA sold an additional 27,084 M3s before production ended in August 1999, bringing the total to 35,843 cars. That was an astonishing figure, and it represented fully one-third of all M3s produced. The success of the M3 turned the U.S. from a marginal M-car market to the world’s largest and most important by 1995—an accolade it holds to this day. “We showed that at the right price point, the M3 could be wildly successful in the U.S.,” Brekus said.

“Regardless of your position on the purity of the U.S. M3, there is no doubt that the reputation and volume of the U.S. E36 M3 did wonders to establish BMW M in North America, while providing BMW M with the cash reserves needed to develop the incredible E46 M3 that followed,” Plucinsky said.

The E36 M3 itself had met enthusiast demands, and its performance credentials were solidified by a racing program organized by Wensberg as Motorsport Manager—and M Brand Manager, starting in the fall of 1994. Following a development year in 1995, the M3s campaigned for BMW NA by Prototype Technology Group won the GT driver’s titles for Pete Halsmer and Bill Auberlen in 1996 and ’97, respectively, and the 1998 GT2 title for the team. In recognition of the BMW CCA’s role in bringing the E36 M3 to the U.S., the cars raced with BMW CCA stickers on their front splitters, and they’ve remained on every GT car raced by BMW NA since 1995. “The CCA letter-writing campaign started the whole ball rolling in the U.S.,” Wensberg said. “It’s really the club’s team.”

—end—

In South Carolina, history can be divided into two epochs: Before BMW, and After BMW. BMW’s own history can be similarly divided: Before Spartanburg, and After Spartanburg.

The dividing line between each period is June 23, 1992, when BMW announced that its first full production plant outside Germany would be built in Spartanburg, South Carolina. (BMW’s plant in Rosslyn, South Africa wasn’t yet a full production plant.) Leading up to that announcement, BMW executives had recognized the need to expand beyond Bavaria if the company were to continue to thrive.

It wasn’t a new idea—in 1961, BMW had explored a manufacturing partnership with American Motors—but it gained traction in the 1980s. Following the decoupling of the US dollar from the gold standard, exchange-rate fluctuations were making German imports more expensive in the US just as new Japanese marques began offering premium cars at much lower prices than BMW or Mercedes. BMW countered by reducing prices, but it wasn’t enough.

“The Board of Management realized that they were going to have to leave Germany with some production for other parts of the world,” said Carl Flesher, then BMW of North America’s VP of Marketing. “That was a huge decision, but boy did they make the right one.”

Beginning in 1989, a team of executives led by Helmut Panke, then head of BMW’s Group Planning Division, began searching for a suitable location for a new factory. They considered more than 200 locations worldwide before deciding to set up shop in the US, where the finalists were narrowed down to Omaha, Nebraska, and South Carolina. Omaha had plenty of cheap land and good rail connections to the rest of the continent, but so did South Carolina, which also had a deep-water port in Charleston.

“We ended up in South Carolina because of the port operation, and we had planned to settle the manufacturing operation just outside of Charleston until Governor Carroll Campbell told us that was a mistake,” Flesher said. “He said hurricanes hit there and our standing inventory would be in a lot of trouble.”

Campbell suggested the Upstate region, about 200 miles northwest of Charleston. The Upstate was South Carolina’s traditional manufacturing corridor, known for nearly a century as the Textile Capital of the World. By the late 1970s, however, most of its 40 mills had closed, unable to compete with lower-priced textiles from China and other emerging markets.

“We had hard times,” says Bobby Hitt, then managing editor of the Columbia Record in South Carolina’s capital. “This was an area that had lost over 60,000 jobs to the textile industry leaving, and there were a lot of stores boarded up.”

The Upstate was well situated, with major rail lines and Interstate 85 running through Greenville, Spartanburg, and Anderson counties. That infrastructure had already inspired Michelin to relocate its North American headquarters from New York to Greer, South Carolina in 1985, and to place seven of its 15 production plant in the state.

“Panke worked with the governor’s office and found a location in Anderson next to a railroad track, where the acreage was large enough for us to build and expand,” Flesher said. “Then [Board Chairman Eberhard] Mr. von Kuenheim flew to the US with Panke to see the site, and he told Panke that this wasn’t where BMW needed to be. He said we need to be on the interstate, we need to be visible, and we need to be next to the airport.”

One site met von Kuenheim’s criteria, but it already had 250 homes on it. “The governor’s office went to every single one of those homeowners, and they all agreed to move,” Flesher said. The houses were either moved to new locations or purchased so their owners could purchase another house elsewhere, and no exercise of eminent domain was required. “I thought, ‘Wow, South Carolinians are not built like New Yorkers.’ What a sacrifice.”

South Carolina’s Ports Authority as well as the state and county governments spent $36.6 million buying the 900-acre plot, then spent another $90 million on highway development, an airport expansion, job training, and a 20-year flat rate for water and sewer services at the plant.

“At the time, people thought South Carolina had given away the store, that we’d been taken to the cleaners by BMW,” said Hitt. “I think now, people have come to realize that the greater risk was taken by BMW, coming to a place that was so unknown.”

It may have been unknown, but BMW did its research. As Panke’s team discovered, South Carolina had another crucial ingredient for successful manufacturing: a network of 16 technical colleges, which could help supply the skilled workforce BMW needed to build automobiles.

“The planners at BMW said they looked at the technical education system in South Carolina and saw it as the best in the country, that it had the ability to create skill in its people,” Hitt said. “They also rode around in the neighborhoods—I love the way Germans do this—and looked at how people lived. They kept their houses and their cars neat, and that meant they were prideful. And if you take skill and pride, you can build a BMW.”

BMW’s decision to build a new plant in Spartanburg, South Carolina was announced by Governor Campbell and Chairman von Kuenheim on June 23, 1992. The night before, the news broke on WYFF television by senior correspondent Kenn Sparks, who’d been given the scoop by Campbell. (Sparks would later join BMW Manufacturing as an Internal Communications Manager.)

“Nobody knew what it meant, quite honestly,” Sparks said. “Even Governor Campbell didn’t grasp the scale. But what he did grasp, and this was the ultimate goal of his administration, was that this was not just an automobile plant. He said, ‘Kenn, we are bringing the auto industry to South Carolina. When an auto plant comes, an industry comes with it, and it is going to have profound effects across the state.’”

First, BMW had to build a factory, for which it estimated the cost at $400 million. On September 30, 1992, Governor Campbell and Chairman von Kuenheim broke ground for BMW’s first full production plant outside of Germany.

“The groundbreaking in Spartanburg is still a vivid memory for everyone who participated,” said Tom McGurn, then BMW NA’s Corporate Communications Manager. “The dealers drove 7 Series from a dealer meeting in Atlanta, and as we crossed into South Carolina we left the interstate for a rural road. There were people holding signs welcoming BMW to the state, and as the caravan reached Greer the main street was completely lined with welcomers, even a high school band.”

During the ceremony, Campbell declared the occasion “symbolic of a new era focused squarely on the next century of progress” for South Carolinians, while von Kuenheim pronounced it the same for BMW.

“The decision that takes us to America is a major step for BMW,” said von Kuenheim. “We know it is the right decision in view of the future demands. The right people for the task are already right here where we need them. Together, ladies and gentlemen, we shall make automobiles from South Carolina famous throughout the world.”

Construction of the plant took just 23 months, during which BMW began hiring management and assembly workers. In April 1993, Panke was named chairman and CEO BMW (US) Holding Corp., which gave him responsibility for BMW of North America as well as BMW Manufacturing; he’d hold that position until July 1995, when he returned to Munich as BMW AG’s executive director.

Interestingly, the production team would be led not by personnel from Germany but by executives recruited from Honda of America Manufacturing in Ohio: Allen Kinzer and Edwin Buker. Kinzer would serve as BMW Manufacturing’s first president, with Buker as VP. The two were chosen for their expertise in running a foreign automaker’s plant in the US.

BMW has never discussed whether South Carolina’s traditional antipathy toward labor unions had worked in its favor during the site-selection process, but the decision to eschew the UAW wasn’t about saving money. At Honda, Kinzer and Buker had fostered greater cooperation between management and labor than was customary in unionized auto plants which lead to higher production quality, which Panke declared a goal at BMW, as well.

BMW had no trouble attracting nearly 100,000 applicants in its first round of hiring. From those, approximately 570 were selected, with that number expected to increase to 2,000 by the year 2000.

As Honda had done in Ohio, BMW Manufacturing would begin production with an existing model, the four-year-old E36 3 Series sedan. “It was a known quantity[MO1] [OS2] , and we would know if we were building them right or not,” said Flesher, who became BMW Manufacturing’s first vice-president of public relations in 1992. “We had to build a lot of cars before the assembly line settled down and could do it consistently.”

The first complete car rolled off the line on September 8, 1994, bearing the signatures of every associate at the plant. Two months later, on November 11, 1994, that car would be driven onstage by Sky Foster, Associate number 5, who’d joined BMW Manufacturing’s human resources department in 1993 and went on to serve in Corporate Communications until the end of 2021.

“The company was small enough at that point that every person who worked there fit on the stage,” Sparks said. The presentation was followed by fireworks and a reception at the Zentrum, attended by all of the associates and luminaries including Pischetsrieder in his new role as chairman of the board of management, Panke as new BMW NA CEO, supervisory board chairman Hans Graf von der Goltz, and Johanna Quandt, the widow of BMW principal shareholder Herbert Quandt, who’d died in 1982. For Mrs. Quandt, especially, it was momentous occasion.

“Mrs. Quandt was beside herself with joy,” Sparks said. “She was so happy seeing the factory, the associates, the first car, and all of that. She was so heartfelt in saying, ‘I wish my husband Herbert Quandt were alive to see this. This is something he always wanted.’ I asked her what she meant, and she said he was so grateful to the US for the Marshall Plan that rebuilt Germany after World War II, and he’d always wanted to show his gratitude for what the US had done for Germany. It still chokes me up, just remembering that, because it was so much from her heart.”

Having established its competence with the 3 Series, BMW Manufacturing was soon ready to begin building an all-new car: the roadster.

In May 1993, Pischetsrieder had succeeded von Kuenheim as BMW Board Chairman. While BMW’s new roadster was under development, he suggested that it be assembled at Spartanburg. “Pischetsrieder said it looked like what we should be building there,” Flesher said. “It’s adding to the brand, not just repeating what we’re already building.”

Z3 production began in September 1995, followed shortly by the car’s debut in the James Bond film GoldenEye. By the time production ended in July 2002, Spartanburg had turned out 297,088 examples, of which about 40 percent were sold in the US. The Z3 attracted a devoted following, and in 1997 its owners began gathering for Z3 Homecomings at the plant and the Zentrum.

The Zentrum and its 200-seat auditorium had already become popular as an event space for the local community following its opening in 1995, as well as a training center for new associates and a staging ground for plant tours.

“Panke decided to build the Zentrum, and the concept was that the plant needed to introduce itself to its new neighbors,” said Sparks, who was in charge of the Zentrum during his tenure at BMW Manufacturing. “Mobile Tradition (now BMW Group Classic) was just getting underway, and Pischetsrieder instructed Christian Eich [Head of Mobile Tradition] to give the Zentrum the right selection of historic BMWs that would show off the history of our company. We also borrowed cars from enthusiasts, and we built our own historical exhibit on the models assembled at the plant, including the James Bond Z3 from GoldenEye.”

Four years later, the Z3 would be joined by another model exclusive to Spartanburg: the X5. As BMW’s first Sports Activity Vehicle, the X5 was aimed squarely at American tastes, though its global success would end up spawning an entire series of X vehicles, turning the Spartanburg plant into BMW’s center for competency for SAVs worldwide.

Since 1992, BMW has invested $14.8 billion dollars in its Spartanburg plant, and what began as a single assembly hall building 3 Series sedans and Z3 roadsters is now an eight-million square foot colossus. It’s BMW’s largest  production plant worldwide, surpassing even the home factory in Munich for volume. Production has grown from 28,000 vehicles per year to a 433,810 per year record in 2021. Plant Spartanburg is currently capable of producing up to 450,000 vehicles per year. (Following the end-of-production of the first-generation Z4, roadster production was moved to Germany.)

Spartanburg builds X3, X4, X5, X6, X7, and XM models, including models with hybrid powertrains. Starting in 2026, those vehicles will use batteries assembled at a $700 million plant in nearby Woodruff. That will coincide with production of battery-electric variants of BMW X vehicles.

Drivetrain flexibility was pioneered at Spartanburg, which has the ability to build vehicles with gasoline or diesel combustion engines, plug-in hybrid powertrains, or fully electric drive on the same assembly line.

The innovations don’t stop there. In the body shop, Spartanburg was BMW’s first plant to employ a new optical measurement system that streamlines the entire production process. Digitalization is also reaching new heights at Spartanburg, allowing more precise logistics within the just-in-time production process. That process now includes sheet-metal stamping, which came online at Spartanburg in 2024 after three decades of outsourcing.

Spartanburg was BMW’s first plant to use cooperative robots, which work together with humans to build the automobile. Previous assembly robots had to be isolated from humans because of the potential for injury or even death. New sensors allow humans and robots to work together, because the robot can now sense when its movement might injure a human worker. Today, the plant is testing humanoid robots, which might one day relieve human associates from repetitive or ergonomically challenging tasks. Toward that end, Spartanburg was first to equip its associates with exoskeletal supports, helping to reduce the physical strain of assembly work.

Even as its vehicles were created to suit American tastes, exports have figured prominently in the Spartanburg business plan since the beginning. The BMW X models have become increasingly popular worldwide, and currently more than half of production is exported to 120 countries around the world, making Spartanburg the largest vehicle exporter by value in the United States (value of $10 Billion in 2024). At the same time, Spartanburg-assembled vehicles now constitute more than 50% of all BMWs sold in the US.

Sustainability has also been part of the mission from the outset, particularly with respect to renewable energy and reduced CO2 emissions. The plant gets about 20 percent of its energy requirements from methane gas generated by the Palmetto Landfill, which is connected by a 9.5-mile pipeline to BMW Manufacturing. There, it’s converted into electricity and heat for the plant’s operations. Elsewhere, the plant uses hydrogen fuel cells to power the automated tuggers that move parts and other supplies along the line.

As the plant and production have grown, employment has increased dramatically, too: from 570 employees in 1994 to more than 11,000 in 2024. So has the supplier base. Where BMW Manufacturing had hoped to attract nine local suppliers, the plant is now served by more than 60 Tier 1 suppliers in South Carolina alone, and around 300 throughout the US. Those suppliers include ZF (transmissions and axle systems), Magna (steel), DAA Draexlmaier (dashboards), and Sage Automotive Interiors (upholstery) that have set up nearby to serve BMW’s just-in-time manufacturing process.

A 2023 study by the University of South Carolina’s business school found that BMW Manufacturing was responsible, directly and indirectly, for nearly 43,000 jobs in the state, paying $3.1 million in wages and salaries as part of its annual economic impact of $26.7 billion. That wouldn’t have materialized if BMW had chosen another location for its first full production plant outside Germany. Instead, BMW’s investment inspired Boeing, Mercedes, and Volvo to set up their own production plants in South Carolina, compounding the economic impact.

“The presence of BMW has changed everything in the trajectory of the future in this state,” said South Carolina Governor Henry McMaster. “It has created a manufacturing renaissance in South Carolina which is unequalled in any other state.”

BMW changed South Carolina, without a doubt. At the same time, South Carolina has changed BMW, turning it from a small Bavarian automaker into a global powerhouse, and one of the most recognized brands worldwide.

“When we made the decision to build this plant, the entire company was the size this plant is today,” said Oliver Zipse, chairman of the board of management.

Indeed, the 1993 output of BMW’s factories in Germany and South Africa numbered just 532,960 vehicles, and its total workforce consisted of 71,043 employees. Three decades later, those two factories have been joined by plants in the US, Mexico, Brazil, India, China, Thailand, and the UK, plus additional locations in the European Union, whose 154,950 employees assembled 2,554,183 BMW, MINI, and Rolls-Royce automobiles in 2023.

BMW’s globalized manufacturing network helps to insulate the company from currency fluctuations worldwide, and it also gives the company a strong foundation against increasingly nationalistic trade policies (i.e. tariffs). It also allows BMW to better withstand supply-chain disruptions, like those that resulted from the global pandemic of 2020-2021. As a result, BMW’s profitability has risen from DM 516 million ($311 million) in 1993 to €17.1 billion ($18 billion) in 2023.

BMW’s investment in Spartanburg represented a commitment in the US market, one that paid off handsomely. Having sold just 65,683 vehicles in the US in 1993, BMW of North America sold 371,346 in 2024—another record year. That’s a nearly sixfold increase, one that neatly quantifies the After Spartanburg era at BMW, as well as the After BMW era for South Carolina.  

To succeed, a business needs access to capital. It needs to purchase raw materials, invest in production facilities, and pay those who design, build, and sell its products. Once those products have been created, however, it’s the customer who needs access to capital, especially when the products in question are big-ticket items like premium automobiles that few purchase with cash.

Customers can certainly obtain auto loans from banks and other financial institutions, but it’s advantageous to the manufacturer to offer that credit directly. If the customer can obtain the funds needed to buy or lease a new car through the manufacturer’s “captive finance” arm, the manufacturer can realize a profit not only on the sale of the vehicle but on the servicing of the loan with which it was purchased, and again when the vehicle is traded in on another new vehicle.

General Motors realized the value of captive finance more than a century ago, establishing General Motors Acceptance Corp. in 1919. Other companies followed suit, and by the 1960s all three domestic auto companies had their own captive finance companies. Then, in the early 1980’s, when Toyota began to grow market share in the USA, it was the first of the Japanese manufacturers to create captive finance arms.

Since cars and motorcycles were secondary to airplane engines in BMW’s prewar business model, BMW had little need for a captive finance arm until it abandoned military contracting after World War II. Even then, however, the company’s tenuous finances prevented it from offering credit to customers until 1971, when BMW Kreditbank began offering loans in Germany. In the US, the process would take considerably longer, first requiring the replacement of independent distributor Hoffman Motors in 1975 by the BMW of North America wholly owned sales subsidiary. Even then, it took BMW NA another decade and a half to reach the sales volume needed to warrant the establishment of a captive finance arm.

In the late 1980’s, BMW suffered a two-pronged crisis that resulted in a severe drop in US sales from a high of 96,759 in 1986 to just 53,343 units in 1991. First, the yuppy phenomenon that had boosted BMW sales in the early 1980’s, came to an abrupt end as the yuppies moved onto the next big thing and then BMW (as well as the established German brands) were faced with new luxury competitor brands from Japan.

By the time the Lexus brand was launched at the North American International Auto Show in January 1989, Toyota Motor Credit had almost a decade of retail financing experience to pass onto Lexus Financial Services. Regaining BMW’s lost sales volume would take more than just better products at lower prices. It would require a new way of doing business. In 1992, BMW Financial Services began offering exactly that, exchanging a program that operated through GE Capital in favor of captive finance.

Federal and state regulations required BMW Financial Services to be incorporated as a separate entity from BMW of North America. Though both firms would be headquartered in Woodcliff Lake, New Jersey, Financial Services’ daily operations would be conducted in Hilliard, Ohio, near Columbus. Columbus was the home of Financial Services’ first president, Kevin Westfall, who’d come to BMW from Chrysler Credit in 1990 and tied Financial Services in with Columbus-based Banc One (now part of JP Morgan Chase). “Ohio made sense for the workforce,” said Neal Crouch, who joined BMW Financial Services in 1994 and currently serves as the division’s chief risk officer. “There are multiple colleges nearby, there’s a young workforce, and it’s very affordable where cost of living is concerned.”

The division was being built from scratch, hiring an all-new workforce and creating new operational structures in an increasingly digital era. “We pretty much needed to build everything,” said Charles Silva, who served as BMW Financial Services’ information technology manager from 1992 to 1995. “The sales company had a lot of existing systems, but as a regulated entity, we needed to be a completely separate company. We could purchase some commercial, off-the-shelf software that could serve for a limited period of time, but the rest we had to code from scratch.”

Crouch and Silva both cite the early leadership of John Christman (first as chief financial officer and then as CEO) and Robert Devine (as VP of operations and managing director) for the early success of Financial Services. “Both did a lot to get us up and running, to gain the dealers’ trust,” Crouch said.

Once up and running, BMW Financial Services began offering the new-car financing and leasing options that were customary in the captive-finance industry. In typical BMW fashion, the division didn’t follow the existing models entirely but innovated within them to increase sales as well as profits.

“We were industry-leading on the end-of-lease process, with a program called Full Circle,” Crouch said. “If we could bring down losses on the sale of used cars, it benefits both the sales company and Financial Services.”

Toward that end, BMW was the first manufacturer to offer a Certified Pre-Owned program that would allow dealers to offer the best-maintained used cars at a premium price. The customer, in turn, would be able to buy a used BMW in better condition and with the peace of mind of a comprehensive factory backed extended warranty. As the Full Circle name implies, the program also helped BMW’s cars retain their residual value, allowing for lower lease rates when the cars were new and helping BMW increase sales overall from the dark days of 1991.

“BMW Financial Services was an integral part of the sales rebound,” said Tom McGurn, then BMW of North America’s general manager for corporate communications.

“We brought two key factors,” Silva said. “One, getting financing for customers, so they’re not exploring it with other banks but keeping it within our ecosystem. Two, creating loyalty. Now the customer is in our portfolio, and we can enable more leasing. When they have a return-to-market event in three years, we have an opportunity to move them up the product chain. If they’re a 3 Series customer, maybe their life events allow them to go into a 5 Series. It’s a loyalty driver for the group.”

Crouch concurred. “A lease is on the books for three years, and we have tools to help dealers manage that off-coming volume. It’s like an annuity that always brings customers back. The dealers see us as helping with the sales side, too.”

Indeed, Financial Services plays a crucial role in that regard, and not only by providing the capital customers need to buy cars. The division also offers financing to dealers, helping them floorplan (purchase) new and used vehicle inventory or mortgages for their facilities.

All of those products allowed BMW Financial Services to play a major role in BMW’s recovery from the challenges of the early 1990s. And in 2008 and 2009, the flexibility provided by Financial Services helped BMW weather another challenge when a mortgage-finance crisis in the U.S. shook the global economy. While some domestic automakers stood on the precipice of bankruptcy, BMW Financial Services kept business moving for BMW.

“What we were losing on residuals was very large every month,” Crouch said. “Financial Services and sales were sharing some of these losses, and we had to shore up the balance sheet. For the dealers, Financial Services wanted to make sure we had liquidity for what they wanted to do, for their floor plans, and to finance leases and loans when a lot of banks weren’t providing auto loans.”

As a result, BMW outperformed the industry as a whole from 2007 to 2009. BMW of North America’s sales fell by 32 percent during that period even as the US auto market as a whole fell by 54 percent, and when both Chrysler and General Motors required federal bailouts to survive.

Even without major disruptions, the automotive industry requires constant adaptation to shifting tastes as well as a changing economy. As the 21^st  century rolled on, Silva said, “We saw deteriorating realized market values for our used cars, we were spending more on incentives, and maybe our product portfolio in the U.S. market didn’t exactly match what consumers were demanding. Even our relationship with the dealer network: How do we ensure that they are our partners and not our adversaries?”

To reach its goals, Silva said, BMW implemented Strategy 2017, developed under BMW NA CEO Bernhard Kuhnt and BMW Financial Services CEO Ian Smith to foster a closer collaboration between its captive-finance arm and its sales operation. “I think it was a critical turning point for the success we’re now realizing in the U.S. on a group level. The two companies are working much more closely together while still maintaining the legal separation we need. It’s helped us to go to market in a way that no other OEM-captive relationship has been able to achieve, and that’s what powered us through some of these challenging times.”

That includes the Covid pandemic of 2020, through which BMW Financial Services kept business moving once again, as did its counterpart MINI Financial Services, established in 2001.

Today, BMW Financial Services is led by Birgit Boehm and operates not only in the U.S. but in Canada, Mexico, and Brazil. It’s a crucial component of BMW’s profitability, employing more than 1,000 people and servicing more than $45 billion in assets for 1,300,000 customers in the U.S. alone. Some of those customers are new to the brand, attracted by loan programs aimed at customers like recent college graduates and members of the military who might not have established the credit they need to get loans elsewhere. Such programs help BMW Financial Services ensure customer loyalty to BMW as a whole—as does the division’s commitment to BMW’s success.

“When catastrophic events like Hurricane Helene happen, or just on the weekends, our teams jump in to make sure that we’re booking and approving credit, and doing everything we can to make sure our customers can get into the car, our dealers can sell the car, and we can get that car across the curb,” Crouch said.

And once the car is delivered, Financial Services constitutes a crucial point of contact for customers during the life of their lease or loan. To customers, Financial Services is BMW, and Crouch says they’re in good hands with his division. “Our employees care about the calls that come in, and they have a lot of empathy for our customers.”

It may be situated on the far edge of the country, but California has long been the center of the U.S. where car culture is concerned. In California, cars are more than just transportation; they’re vehicles for self-expression. It’s no wonder, then, that car companies look to California when they need something new and unexpected.

That’s exactly what BMW did in 1990, when its design department was left rudderless in the wake of design director Claus Luthe’s unexpected departure. Looking beyond Munich for an infusion of panache, BMW found it in a California design studio called Designworks/USA. Designworks/USA had been founded in 1972 by Chuck Pelly, who’d begun his career by penning the gorgeous Scarab race cars in 1958 followed by the first two Chaparrals in 1961. Pelly had started Designworks/USA in his Malibu garage, and the firm had expanded to fill spacious quarters in Newbury Park by the time BMW joined companies like Nokia, Compaq, and several transportation firms on its client roster.

Pelly had drawn BMW’s attention with an innovative design for car seats, which integrated the safety belt with the seat back for easier entry and a tighter fit. The seats were used first by Volvo in 1985, then incorporated into BMW’s new E31 8 Series in 1990.

The collaboration proved so fruitful that BMW purchased a 50 percent stake in Designworks/USA, giving the company an important outpost in the center of American car culture. On August 8, 1990, BMW announced the investment to the public, citing the “positive experiences” of its work with Pelly as well as the potential benefits to car buyers. “BMW's involvement in this creative venture means that the wishes of American customers, the conditions and developments of the American market are taken more into account and that BMW's development activities can be accelerated and internationalized.”

The acquisition was part of a surge of investment in the US, one which would include the establishment of BMW Financial Services as well as the construction of an automobile plant in South Carolina. “It was a statement that we were in tune with the American market, that we now had a design affiliate in Southern California,” said Tom McGurn, then BMW NA’s General Manager for Corporate Communications.

At the Los Angeles Auto Show in January 1992, BMW showed its first car produced in collaboration with Designworks/USA and the first prototype manufactured entirely at Designworks. A follow-up to the E1 designed in Munich by BMW Technik GmbH, the battery-electric E2 combined forward-thinking efficiency with California cool. 

The burgeoning relationship between BMW and Designworks/USA got an additional boost in 1992, when Chris Bangle was hired as head of BMW Design in Munich. The American-born Bangle had earned a degree in transportation design at Art Center College of Design in Pasadena, where he’d studied under none other than Chuck Pelly, himself a graduate of the highly-regarded program established in 1948. Recognizing the value of a design outpost in California as well as the studio’s capabilities, Bangle encouraged BMW to purchase the remaining 50 percent of Designworks/USA. In 1995, Designworks/USA became a wholly owned subsidiary of BMW AG and was renamed BMW Designworks/USA, with Pelly as president and CEO.

In taking complete ownership, BMW gained an important foothold at the center of California’s taste-making car culture. Equally important, the company would have a direct pipeline to new talent emerging from Art Center; many Art Center graduates were already going straight from the college to BMW Designworks/USA. Under BMW’s ownership, BMW Designworks/USA could allow young designers to develop their skills far from the production-oriented studio in Munich, in an environment that would encourage exploration and experimentation.

Toward that end, Bangle asked BMW Designworks/USA personnel who’d been working on non-car projects in California to offer suggestions of what a car might be. Half a dozen were submitted, including a model from Fernando Pardo dubbed GINA. Pardo’s model consisted of a metal framework covered by a nylon stocking, suggesting a covered wagon or dirigible. The idea was interesting enough to warrant a full-size prototype in 2001, at which point Pardo’s aesthetics lost out to a design from his colleague Anders Warming. Warming’s design would be developed for production on the Z4 roadster and coupe of 2002 and 2005, respectively; he’d also apply it to the BMW Concept Coupé Mille Miglia shown at Concorso d’Eleganza Villa d’Este in 2006.

While providing BMW with cutting-edge design studies, BMW Designworks/USA also became integral to BMW’s production-car design process, submitting proposals to BMW’s internal competitions. The first to be chosen was Erik Goplen’s design for the E46 3 Series, which launched in 1998. That car was followed in 1999 by the groundbreaking X5, BMW’s first Sport Activity Vehicle. Aimed at the American market, the X5 was designed by Chris Chapman at Designworks/USA, with some elements contributed by Ivan Lampkin and Frank Stephenson.

While those vehicles were being readied for production, BMW Designworks/USA was engaged in the type of top-secret project that could only be conducted outside Munich. Code-named “Deep Blue,” the project was convened by Bangle and Dr. Burkhard Göschel, head of the Special Vehicles department that was also responsible for the X5 and Z8. In the wake of the X5, Deep Blue’s goal was to define the “next phenomenon” for the U.S. market. Deep Blue yielded six new-vehicle concepts, the first of which was the X coupé designed by Chapman with an interior by Warming. Shown to the public in 2001, the asymmetrical X coupé proved too controversial for production, and the outrage that ensued caused the Gina project to be sent into long-term storage. Other Deep Blue concepts met a more favorable reception: The X Activity Vehicle was realized as the X3, Chapman’s CS1 became the first-generation 1 Series, and a coupe-styled X5 derivative known as the Concept X6 went into production under that name.

In 2000, Pelly stepped down as president and CEO of BMW Designworks/USA. Though he remained a consultant to the company, operational responsibility was turned over to Henrik Fisker, who’d designed the Z07 roadster concept and the production Z8 at BMW Design in Munich. Fisker’s tenure at BMW Designworks/USA would be brief, lasting barely two years before he departed for a Ford design subsidiary in London.

As Fisker’s replacement, Bangle appointed Adrian van Hooydonk, a ten-year veteran of BMW Design who’d been heading BMW Designworks/USA’s exterior design department since 2000. Before leaving Munich for California, he’d penned the 1999 Z9 coupe and cabriolet concepts that would see production as the 2001 E65 7 Series and 2003 E63 6 Series. At BMW Designworks/USA, he designed the Mini Millenium concept, which pointed toward the future of the British brand acquired by BMW in 1994.

Van Hooydonk would remain at BMW Designworks/USA until 2005, when he returned to Munich as head of automotive design for BMW; four years later, he succeeded Bangle as head of BMW Group Design, a position he holds to this day.

Since 2005, the subsidiary has been led by a succession of BMW design luminaries: Verena Kloos (2004-2009), Laurenz Schaffer (2009-2016), Oliver Heilmer (2016-2017), Holger Hampf (2017-2023), and Julia de Bono (2023-present). In 1998, BMW Designworks/USA opened a branch in Munich, and in 2006 expanded to Singapore. In response to the tremendous growth of the Chinese automobile market, the Singapore office moved to Shanghai in 2011. In 2015, the subsidiary underwent another name change, becoming known simply as Designworks, and in 2023 its headquarters moved to Santa Monica.

Designworks completes about 300 projects per year, of which half are commissioned by outside clients in fields as far ranging as electronics, private aircraft, and yachts. BMW of North America on behalf of the US Olympic and Paralympic teams have commissioned Designworks to create racing wheelchairs and bobsleds, the latter designed by Michael Scully, currently the Head of BMW M design, who was responsible for the Formula BMW single-seater of 2002 as well as the current M Hybrid V8 competing in IMSA racing.

BMW considers Designworks’ 130 employees the “Architects of the Future,” and the subsidiary is more than just another design studio. It’s also a think tank for developments involving digitization and electrification. Designworks/USA played a major role in Project i, which resulted in the battery-electric i3 and hybrid i8 models, and it’s doing the same for the all-electric Neue Klasse that will follow in 2025.

And after that? It’s Designworks’ job to look beyond the Neue Klasse for what comes next, “to raise and explore questions about the future of mobility that have not been asked, and to develop innovative approaches to topics and problems that the BMW Group is not yet actively addressing.” As van Hooydonk puts it, “Designworks is able to do this because it constantly has its ‘eyes and ears’ on the pulse of the times at three locations. [It] gives us the creative energy we need to be really competitive.”

—end—

Every manufacturer wants its cars to be popular, but popularity brings risks. The “it car” of today can be the “not it” car of tomorrow, especially if it becomes popular among customers chasing what’s fashionable rather than what’s inherently valuable.

In the mid-1980s, BMW became the “it car” among a newly-identified demographic: the Young Urban Professionals known as Yuppies, a term first recorded in 1980 by Dan Rottenberg in Chicago magazine. Unlike the linguistically-related Hippies and Yippies, Yuppies embraced consumer capitalism, and they sought out products that would reflect and enhance their upwardly-mobile status.

Where cars were concerned, Yuppies went all in for BMW, a brand that combined European sophistication with the youthful dynamism that brands like Mercedes and Volvo lacked. Yuppie demand for BMWs helped sales increase steadily, from 37,017 in 1980 to 96,759 in 1986, as the stock market soared and every broker in New York wanted a 3 or 5 Series to signify his success.

“I was a Wall Street hotshot, moving paper assets from one side of the street to the other,” said Jeff d’Avanzo, who’d shared a 2002 with friends while in college. “In the fall of 1987, I visited Competition Motors, a BMW dealership in Smithtown, New York. I dropped a few tidbits about the financial markets and coaxed a test drive of an E28 535i out of a skeptical salesman, who thought me too young to afford the $36,000 or so sticker price. He was correct, but I had an image to uphold! A month later, the financial markets crashed, and I was out of work within a week.”

According to the Federal Reserve, the Dow Jones Industrial average had gained 44 percent in the first seven months of 1987. The stock market was beginning to look overheated when a series of news reports undermined investor confidence and sent stock prices falling on October 14. On “Black Monday,” October 19, stocks crashed at the opening bell, losing 22.6 percent before trading was halted.

The Yuppie era was over, and with it went a large portion of BMW’s customer base—and BMW’s favorable image.

 “We called it the Yuppie Hangover,” said Tom McGurn, then BMW of North America’s General Manager for Corporate Communications. “The Yuppie association was good in the beginning, but then it switched to being a symbol for greed and entitlement.”

Indeed, BMW’s image as a “Yuppiemobile” had harmed its reputation among those who’d discovered the brand years earlier via the 2002 or E9 coupe, and who considered themselves connoisseurs of fine automobiles rather than status seekers. Moreover, those enthusiasts felt abandoned by BMW itself, as the company struggled with tightening safety and emissions standards that burdened its cars with ungainly bumpers and restrictive exhaust systems. To take just one example, the E21 320i arrived in 1977 making significantly less power—110 horsepower and 112 pound-feet—than the outgoing 2002 tii, which had delivered 130 horsepower and 130 pound feet from the same 2.0-liter M10 four-cylinder engine. And to many enthusiasts, the E21’s handling was worse than that of the 2002.

 “I was a big BMW fan, and I’d joined the BMW Car Club of America in 1978, but I didn’t own a BMW in the ’80s because I was so discouraged by what happened to the brand,” said Rich Brekus, who’d join BMW of North America in 1994. “The cars were no fun, and true BMW fans were looking for something else, like the Audi Quattro and the Saab Turbo.”

Throughout the 1980s, the BMWs sold in the US made significantly less power than their European counterparts with the same engines. “The perception was that we were not getting the best BMWs in the US, and that led to the grey market situation,” McGurn said.

The so-called “grey market” constituted private imports of cars offered in Europe but not the US. That included cars like the M635CSi, which delivered 286 horsepower where the US-spec 635CSi put out just 182 horsepower, or the six-cylinder 323i, which delivered 150 horsepower versus the 101 horsepower available from the four-cylinder 318i sold by BMW in the US. Such cars were wildly expensive, but they were worth the trouble and expense to enthusiasts who wanted high-performance BMWs. In 1987, BMW of North America finally countered with a US-spec M6, but even that car fell shy of its European counterpart where horsepower was concerned. Moreover, it was nearly as expensive as a grey market import, as were the US-spec M3 and M5 that arrived in 1988.

In the midst of those challenges, BMW was forced to reckon with affordably-priced Japanese imports from Lexus and Infiniti, which took direct aim at BMW upon their arrival in 1989. That year, BMW of North America’s sales fell to 64,881 automobiles, followed by 63,646 cars in 1990 and just 53,343 in 1991.

Rebuilding the BMW brand in North America would take more than shedding the burdensome Yuppie image. It would take a renewed commitment to the U.S. market, headed by a strong product initiative—i.e. more performance-oriented cars, with more attractive prices and features that American customers demanded, like cupholders and effective air conditioning.

“Our air conditioning was terrible,” said Carl Flesher, who worked in product planning and marketing during that era. “In Munich, the reaction was, ‘We know about you Americans. You just want to hang meat inside the car.’ I invited two engineers to Kansas City in August, put them in a 5 Series, and had them drive to Houston. When they got there, they called me up and said, ‘Mr. Flesher, we got the message.’ And when we introduced the E32 7 Series, I announced at a dealer meeting that the air conditioning was better than the Cadillac or the Lincoln. That place erupted! I can still see [BMW AG CEO] Mr. von Kuenheim sitting in that chair, looking so surprised.”

In August 1989, BMW NA CEO Günther Kramer retired after four years of performing what McGurn called “superhuman duty.” A lawyer by profession, the 60-year-old Kramer had commuted on the Concorde twice weekly to attend to his roles in Montvale and Munich, where he held a seat on the BMW Board of Management with responsibility for export sales while also serving as head of BMW NA. McGurn said he’d worked closely with BMW in Munich to improve features that were important to American customers, and to reduce the turnaround time when technical problems arose. “He could go right to the source, and get solutions going,” McGurn said. “I think that was Günther’s greatest contribution.”

Kramer was replaced as president and CEO by Karl Gerlinger, 50, a 26-year BMW veteran who had most recently been sales manager for West Germany and Central Europe. He’d also worked in BMW’s export division during the Hoffman era, and he understood the US market well, including its sensitivity to price.

 “After I became VP of marketing, I convinced the new president [Gerlinger, who arrived in 1989] that we needed to reduce the price of the 7 Series,” said Flesher. “Then we offered any 7 Series owner $2,000 toward the purchase of a new car. That took off like a rocket, and sales went straight up to where they’d been.”

For the 1990 model year, BMW reduced the price of its 735i sedan from $54,000 to $49,000, and that of the 535i from $43,500 to $41,500.

Lower prices made the existing lineup more competitive, but they didn’t necessarily make the cars more attractive to customers seeking true BMW performance. The 535i and 735i were powered by the decades-old M30 six with just 208 horsepower, and the V12-powered 750iL wasn’t an ideal solution in the US market. “The BMW board of management wanted to come out with a superior engine to anything Mercedes had, and Mercedes had V8s at the time,” said Flesher. “Hence the birth of the V12. That was supposed to be our answer to the V8. Of course, in America no one knows anything about V12s, which sound complex, like…do I really need all that? It changed the driving dynamic of the car, too. The front of the car got very heavy, and you could feel it.”

By 1991, the tide had begun to turn. The new E34 M5 brought power and performance to the midsize sedan class, albeit at a very steep price, and the new 850i gave BMW a flagship coupe, albeit one with a V12 engine and an even steeper price.

Later that year, BMW NA’s top leadership underwent a shift. Flesher moved on to other responsibilities, replaced primarily by Vic Doolan, who came to BMW NA from BMW Canada with a mission to restore BMW’s image as a maker of Ultimate Driving Machines. By 1992, Doolan had been elevated to the role of president, with Gerlinger as CEO until 1993, when he returned to Munich in favor of Dr. Helmut Panke. Panke was himself replaced two years later by Dr. Heinrich Heitmann; both men left BMW NA to take seats on the BMW Board of Management.

Where BMW of North America was concerned, Doolan came at an ideal time. “Vic was probably the strongest product advocate among anyone in senior management,” McGurn said.

Doolan initiated a thorough overhaul of BMW’s product lineup and operations, which he called the Champion Strategy. “We said, ‘We’ve got to be BMW. First and foremost, we’ve got to have performance,’” Doolan said. “At the time, one of our best sellers was a four-cylinder 318i automatic—the first of the new E36 generation 3 Series—an awful motorcar. I asked Munich if we could have a full six-cylinder range, and they agreed. We priced it just above the four-cylinder, and that gave us the intrinsic value that matched our image as the Ultimate Driving Machine.”

The Champion Strategy also included a renewed emphasis on customer service. Four years of free maintenance began to be included with the purchase of a new automobile, helping BMW shed its “Break My Wallet” reputation. The establishment of BMW Financial Services made leasing more affordable, and used BMWs [Certified Pre-Owned} more attractive. “We were constantly working on the value aspect,” Doolan said. “Although our retail price was higher than the Japanese, the ultimate value and cost of owning the car was comparable.”

In 1994, BMW of North America could finally deliver the V8 engines that Americans preferred, in the 3.0-liter 530i sedan and wagon and the 4.0-liter 540i sedan. An all-new V8-powered 7 Series would follow in 1995.

By then, Doolan had a new head of product planning, Rich Brekus, who’d done the job at Ford before moving to a consulting company. “Bringing performance back to the brand was really my mission,” Brekus said. “That’s what BMW is all about.”

As the ’90s progressed, Doolan and Brekus worked together to improve BMW’s product offerings, while a new marketing director, Jim McDowell, collaborated with the Fallon ad agency on innovative and often humorous ways to sell them. The lineup grew to include a retro-style roadster, the Z3, and BMW’s first Sport Activity Vehicle, the X5.

The Z3 and X5 would be built in Spartanburg, South Carolina, BMW’s first all-new manufacturing facility outside Germany. (The plant at Rosslyn, South Africa had been purchased from Praetors Monteerders, which had begun assembling BMW-Glas models in 1968.) A $400 million initial investment emphasized BMW’s commitment to the world’s largest auto market, as well as its commitment to building the kind of cars Americans preferred. Meanwhile, exports from Spartanburg would cushion BMW from currency fluctuations.

Thanks to those measures, BMW of North America’s sales had begun to improve. In 1992, BMW NA sold 65,683 cars, and by 1995 sales reached 93,309 units, just 450 shy of the earlier peak they’d hit in 1986, at the height of the Yuppie phenomenon.

Having seen the Yuppies come and go, BMW of North America had opted to pursue performance over faddish appeal, and in 1996 the company’s sales exceeded 100,000 cars for the first time. As the 20th century rolled into the 21st, BMW had firmly restored its reputation as The Ultimate Driving Machine.

—end—

For any business, growth is a measure of success. Growth is hardly guaranteed, however, all businesses can ebb and flow on the strength of its internal decision-making, or forces beyond its control. 

In its first decade after taking over from Max Hoffman, BMW of North America’s automobile sales grew steadily: 26,040 units in 1976, 28,776 in 1977, 31,439 in 1978…and so on, all the way up to 96,759 in 1986.

A newly efficient sales and distribution network contributed greatly to that success, but so did a lack of direct competition in the premium sector. Cadillac and Lincoln offered overstuffed seats and soft suspension. Mercedes and Volvo provided safety and solidity. BMW, by contrast, sold Ultimate Driving Machines, cars that were tasteful, well-engineered, and fun to drive. They were also expensive, and not only because of their inherent value.

Because BMWs were imported from Germany, their prices were subject to currency fluctuations between the Deutschmark and the dollar. Germany’s currency reform of 1950 had set the value of the Deutschmark at 4.2 per dollar, and there it remained for two decades. In 1971, however, the US decoupled the value of the dollar from the price of gold, and the dollar’s value began falling against other currencies in line with US policy. Two years later, one dollar was worth just 2.65 Deutschmarks, and by 1980 the dollar had fallen to DM 1.82. For the next twenty years, the exchange rate would fluctuate wildly, with the dollar trading between DM 2.94 (in 1985) and DM 1.43 per dollar (in 1995).

For BMW, the problem was especially acute in the 1980s. “The late 1980s were a tumultuous time,” said Carl Flesher, BMW NA’s department manager for product planning and market research from 1979 to 1986, and its vice-president of marketing until 1992. The price of a four-door 3 Series, for example, rose from $20,055 in 1986 to $28,400 in 1988—albeit with a higher-revving engine—“and that had only passed on half of what the exchange rate did to the cost of cars being imported to the US,” Flesher said.

As BMW would discover, price sensitivity wasn’t limited to customers shopping for small cars like the 3 Series. It also affected customers shopping for BMW’s larger sedans.

“The 7 Series with an inline six-cylinder [the 735i, with a 3.4-liter M30 engine] was at $49,500, and the president [Günther Kramer, who also served on the BMW board of management] wanted to take the price up by $5,000,” said Flesher. “I said, ‘I’m as proud of the brand as you are, but that car can’t handle a $55,000 price tag.’ We took the price up, and we went from 13 or 14,000 units a year straight down to 6,000 a year, just like that.”

As BMW’s cars were becoming more expensive to buy, they were also becoming more expensive to own thanks to new technology and increasing service demands. BMW owners—and prospective customers—joked that BMW stood not for Bavarian Motor Works but Break My Wallet. “You’d take your new BMW in for an oil change and the dealer would tell you that you need a Level II service,” said Rich Brekus, a BMW owner since 1979 who joined BMW NA in 1994. “They’d do everything—spark plugs, filters, transmission and differential fluid—even though the car didn’t need it, and you’d have a $1,500 service bill for what should have been a $100 oil change.”

Like all German manufacturers, BMW was vulnerable, and the last thing the company needed was new competition from Japanese manufacturers known for high-quality, reasonably-priced vehicles with low maintenance costs. That’s exactly what BMW got in 1989, when Toyota introduced its new Lexus LS 400 and Nissan launched the Infiniti Q45, both of which followed the successful debut of the Honda-built Acura Legend in 1986. All three Japanese brands were built to compete with German luxury vehicles from BMW and Mercedes. They even seemed to target specific brands, with Lexus mimicking Mercedes and the sportier Infiniti coming after BMW. Ultimately, Lexus would have the greatest impact on the US auto market…and on both BMW and Mercedes.

Toyota had begun developing its upmarket Lexus line in 1983, on the basis of extensive market research into American tastes and driving habits. When the LS 400 debuted at the North American International Auto Show in Detroit in January 1989, it had everything American drivers said they wanted in a premium automobile: a quiet cabin, high build quality, good fuel economy, a comfortable ride, an efficient automatic transmission, and a V8 engine. Lexus’s 4.0-liter V8 was especially attractive, delivering 250 horsepower while sipping fuel and requiring little maintenance. The brand was even marketed with a compelling tagline, “The Relentless Pursuit of Perfection,” created by the Saatchi & Saatchi ad agency.

The LS 400 (and its smaller, sportier ES 250 counterpart) went on sale in August 1989, offered by 100 carefully-chosen dealers from within the Toyota network. With a list price of just $35,000, the LS400 undercut the price of a 5 Series by thousands of dollars, and that of a 7 Series by at least $15,000. Making the car even more attractive, the list price included features like an automatic transmission, power sunroof, tilt steering wheel, and even the anti-lock brakes pioneered by BMW and Mercedes; all but the anti-lock brakes were extra-cost options on the Bavarian car.

The LS400 was well reviewed in the automotive press, and it didn’t take long before Lexus was matching BMW for sales volume. In February 1990, for example, Lexus sold 4,171 cars against BMW’s sales of 4,113 cars. By the end of 1990, Lexus had sold 63,594 cars in the US, narrowly beating BMW’s total of 63,646 cars for the year.

Was Lexus drawing customers away from BMW? Not necessarily, said BMW of North America president Karl Gerlinger, speaking to The New York Times in 1990. “Our studies show that the number of customers leaving us for Lexus or Infiniti are a minority,” Gerlinger said. “They are primarily attracting customers who are moving up from Japanese products or switching from domestic luxury cars. Obviously, that makes it harder in the area of conquest sales, since we want to get customers coming up from Japanese brands or domestics, too. This is the battle we are taking on.”

To succeed, BMW would have to become more aggressive where pricing was concerned, and it would also have to improve its game with respect to customer service—an area where Lexus excelled. As a new brand, Lexus was able to hand-pick its dealers from among the best Toyota dealers, which proved invaluable after two Lexus customers reported problems with the car’s third brake light in December 1989. With no hesitation, Lexus announced a recall of all 8,000 vehicles sold in the US thus far.

“I was in Munich the day Lexus announced its first recall,” McGurn said. “People were giddy. I said, ‘Hold on, let’s see how they handle it. Everyone has recalls.’ Well, they handled it beautifully.”

Indeed, Lexus’s approach to the recall set a new standard for customer care. “They sent a tow truck to the customer’s house to pick up the car and drop off a loaner,” said Larry Demski, then a regional technical specialist for BMW of North America, advising dealers on repairs and other matters. “No one had ever done that, and it changed the whole dynamic of the industry.”

In just 20 days, Lexus had replaced all of the defective parts on every LS 400 in the US. And when the warranty work was complete, the cars were returned to their owners not only repaired but clean. “I think washing cars at service was something Lexus pioneered,” said Brekus. “BMW didn’t do that. Mercedes didn’t do that. You’d get your car back just as dirty as you’d left it, sometimes dirtier. Lexus was giving you what looked like a brand-new car again.”

In response to that particular challenge from Lexus, BMW of North America worked with its dealers to improve customer-service practices. “We had dedicated people who would make sure the dealers had the right tools in place: the training, the focus on the customer. We made a concerted effort to make sure the dealer was representing the brand the way the brand should be represented.”

Lexus’s low maintenance costs posed another challenge. To counter its Break My Wallet reputation, BMW began including scheduled maintenance in the purchase price of every new automobile, ensuring that no additional charges would be incurred during a customer’s first four years or 50,000 miles of ownership. 

More deeply, BMW recognized the need to improve the reliability of its vehicles in order to compete with the trouble-free operation of the Toyota product. “The cars were billed as the Ultimate Driving Machine, but they didn’t drive!” Demski said. “In the late ’80s, when the E30 3 Series launched, we must have had 20 or 30 cars that broke in the parking lot. That’s where the quality was.”

Since Lexus had a much larger footprint in the US than in Europe, the challenge of bringing BMW up to par with its new Japanese competitors was led by Gerlinger. A veteran BMW executive who’d been in charge of BMW’s export markets during the Hoffman era, Gerlinger had succeeded Günther Kramer as BMW of North America’s president and CEO in August 1989, just as Lexus was arriving on the scene. 

“Gerlinger was an enthusiast who enjoyed cars, and he had a very good product sense,” McGurn said. “The marketing became more challenging because of Lexus, but he made some pricing and strategic moves to turn sales around when it was in the troughs. That took quite a lot of negotiation with Munich.”

For the 1991 model year, BMW re-introduced the four-cylinder 3 Series after a six-year absence, offering the 318i to price-conscious customers for $21,500. With a new 1.8-liter M42 engine under its hood, the 318i delivered a respectable 134 horsepower, and those who wanted more could spend $24,650 to get the six-cylinder 325i with168 horsepower. At the other end of the spectrum, BMW introduced the V12-powered 850i, a technical tour-de-force with dramatic styling priced at just over $90,000 upon its introduction in 1991.

That car wouldn’t help BMW compete with Lexus, and neither did the lower-priced 318i with immediate effect. In 1991, sales fell to a dismal 53,343 units.

“The Japanese were really cleaning our clock, to be honest,” said Victor Doolan, who joined BMW of North America from BMW Canada at the end of 1991. “They had really good products—the LS400, the Acura Legend, even the Infiniti Q45—that were really better value and more reliable, and their dealer network was well-structured.”

It would take a strong product initiative as well as a significant improvement in customer service to regain the sales lost to such unexpectedly strong competition from Japan. BMW of North America was no stranger to competition, and the company accepted the challenge to improve its products, its pricing, and its business practices. In 1992, sales rose to 65,683, starting an upward trajectory that would continue for nearly two decades on the strength of attractive automobiles, an increased investment in the US market, and a dedicated dealer network that put the customer first.

—end—

In its first decade, BMW of North America experienced tremendous growth. Sales doubled within the new company’s first five years, thanks in large part to the popularity of the first-generation 3 Series that debuted in 1976. Along with increased sales came an increase in personnel. By the early 1980s, BMW of North America had outgrown the buildings it had leased from Hoffman Motors as part of the settlement by which it secured the right to sell and distribute BMW automobiles in the US.

First among those was the corporate headquarters and parts distribution center in Montvale, New Jersey, which had opened just a few years before BMW NA moved in on March 15, 1975. Hoffman was known to appreciate fine architecture—he’d commissioned Frank Lloyd Wright to design a showroom on Park Avenue in Manhattan as well as his personal residence in Rye, New York— and the Montvale building was a great example of mid-century Brutalist architecture. The architects of the Montvale building were Rotwein and Blake. Upon entering the building, guests were greeted with an expansive two-story lobby/showroom finished with tan tile floors, a floating staircase and bookmatched, rosewood-paneled walls. At the far end of the lobby showroom, a two-story natural travertine stone wall displayed a stainless-steel BMW roundel and the words “Bavarian Motor Works.”

“It was sort of a strange design,” said Tom McGurn, BMW NA’s first public relations director. “The lobby made a huge statement with rosewood paneling, and it had a lot of glass, but it only had a very small cafeteria, and the offices were a mishmash of sizes.” The largest office, of course, had been Hoffman’s, which McGurn described as “very over-the-top.”

“Hoffman wanted to create an aura and did,” McGurn said. “His desk was semi-circular, so you were a long way away from him. The chairs for the guests were very low, so when you sat in them the desk was almost chest-high. Hoffman wasn’t very large, and his chair was definitely elevated. After [BMW of North America’s first CEO] Jack Cook inherited the office, he remodeled fairly quickly. Jack was not an elevated-chair kind of guy.”

Beyond the oddities of the layout and decor, the Hoffman building had been designed for a company that was selling some 13,000 cars per year. It was simply too small for a company selling five times that number, as BMW was doing a decade after taking over from Hoffman.  By the early 1980s, BMW NA had around 370 employees working out of several buildings scattered around Montvale. “We were bursting at the seams,” McGurn said. “At one point, the marketing department was in a building across the parking lot, and so was the senior vice-president of operations. Other offices were half a mile away. It just wasn’t unified.”

To make matters worse, it was becoming increasingly difficult to insist that the dealer network invest in facilities that displayed a unified BMW corporate identity when BMW NA itself was far from compliant. 

Furthermore, the Montvale location was far from the freeway—commercial truck traffic is forbidden on the adjacent Garden State Parkway—and the large trucks delivering parts and vehicles had to traverse narrow, twisty residential roads to reach the distribution center.

It was time for a new headquarters, and getting one built would be the responsibility of Dr. Günther Kramer, who succeeded Cook as BMW NA’s chief executive officer. Then 53 years old, Kramer had earned his doctorate in law in 1970, and he’d been BMW AG’s chief legal officer from 1973 until his arrival at NA in 1983.

Two years later, Kramer announced that the company’s activities would soon be united under one roof. BMW had purchased 40 acres of land in Woodcliff Lake, about four miles from Montvale and visible from the Garden State Parkway. The property had been an apple orchard, and it featured a small lake and wooded area along its back edge. The new three-story headquarters building was designed by CUH2A architects of Princeton, with exterior panels of white porcelain enamel setting off grey glass windows. The building’s three offset cube layout, premium materials, and clean, unadorned surfaces emphasized crisp white facades that provided the perfect contrast to the Bavarian blue of the company logo. As such, it mirrored the corporate identity BMW wanted its dealers to adopt.

CUH2A did a masterful job of integrating the modern headquarters into the partially manicured and partially natural wooded landscape of the property. The building was almost hidden from the residential street (Chestnut Ridge Road) at the front of the building, yet it showcased BMW’s presence to the traffic flowing down the Garden State Parkway at the rear. At the same time, it provided BMW employees with beautiful, park-like views from its expansive windows.
Construction began in September 1986, and work was completed by the end of 1988. Employees packed up their desks in Montvale on a Friday, and by the following Monday they were working in new offices at 300 Chestnut Ridge Road in Woodcliff Lake. The new building was large enough to contain all of the divisional offices for North America. Its layout— three staggered cubes—provided for a multitude of executive corner offices on two levels throughout. The lowest level housed a state-of-the-art video studio, computer server room, a barber shop, and a dry-cleaning service. A large cafeteria marked a huge improvement over that in the Hoffman building, with indoor and outdoor dining areas, three stories of floor-to-ceiling windows looking onto the woods, and a wide variety of food options at subsidized prices. Finally, the building had an abundant number of meeting rooms that could welcome dealers and suppliers, plus a well-equipped auditorium with vehicle access for larger meetings.

“Everything was consolidated,” McGurn said. “The dealer council no longer had to meet in a hotel, since we had our own conference rooms. We had an auditorium-type room where we could hold an all-employee meeting, which was so convenient.”

To alleviate the parts warehouse trucking issues, a new parts distribution center was built in an industrial area in Mount Olive, New Jersey, some 50 miles away and just off the Interstate 80 freeway.

BMW NA continued to lease the old Hoffman building in Montvale through 2011. As a result of the headquarters move, the Hoffman building became the offices for BMW NA’s Eastern Region handling sales, marketing, aftersales, center development, and other functions for the northeastern US. The Montvale building’s shop space, meanwhile, was used for car and motorcycle technical training and to service company vehicles. The remaining offices nearby were vacated as their leases expired.

The 300 Building, as it was affectionally known, underwent several renovations over its three decades of service as the headquarters for BMW NA. As the company expanded, additional property was purchased and buildings added to the campus.

Somewhat sadly, an era ended on December 13, 2024. The 300 Building was officially vacated, and employees moved into a new BMW of North America LLC headquarters at 200 BMW Drive in Woodcliff Lake.

- Check against delivery –

Statement

Walter Mertl

Member of the Board of Management of BMW AG, Finance

Annual Conference 2025

BMW Welt in Munich, 14 March 2025, 08:00 a.m. CET

Ladies and Gentlemen,

Good morning!

SLIDE: BMW Group in Full-Year 2024

As Oliver emphasized, we continue to follow our course and implement our long-term strategy. At the same time, we are focused on our operational business to consistently deliver on what we say.

The BMW Group proved this once again in Q4 2024:

We successfully reduced inventory impacted by the Integrated Braking System or IBS. And we achieved a sequential improvement in retail sales and profit versus Q3.

For the full year, we achieved our revised guidance in all parameters.

As anticipated, we reached peak levels of R&D and capital expenditure in 2024, particularly to prepare for models of the NEUE KLASSE. Starting this year, both the R&D and capex ratios will decrease meaningfully, as we start production of the NEUE KLASSE and lay the foundation for the long-term success of our company with over 40 new and updated models by 2027.

Through our global positioning and the flexibility of our operations, we can adapt to the geopolitical landscape and short-term market dynamics, proving our resilience.

Let’s take a look at the financial figures for the full year.

2024 was a year of two halves:

While the first half-year was in line with our original planning, sales performance in the second half of the year was impacted by delivery stops in connection with IBS, as well as persistent subdued demand in China. As expected, Q4 marked an improvement on the Q3 result.

SLIDE: BMW Group KPIs in FY24

Group revenues totaled 142.4 billion euros. The moderate decrease compared to 2023 was mainly driven by the decline in sales volume and intense price competition in the Chinese market.

Earnings before Tax at Group level amounted to 11 billion euros – significantly under 2023, but as expected in our adjusted guidance. This resulted in a Group EBT Margin of 7.7% for the year.

SLIDE: BMW Group Segment Performance in FY24

If we look at the key financial results of the individual segments:

Automotive delivered an EBIT of 7.89 billion euros and EBIT margin of 6.3%.

Motorrad had an EBIT of 198 million euros, representing a margin of 6.1%.

Financial Services saw an EBT of 2.54 billion euros and a Return on Equity of 15.1%.

And, finally, Other Entities generated 837 million euros in EBT, while eliminations amounted to a negative 146 million euros.

SLIDE: Automotive Retail Units, BEV Units, Auto Revenue and Auto EBIT in FY24

So, let’s take a look at the Automotive Segment in detail:

For the full year, the BMW Group delivered 2.45 million BMW, MINI and Rolls-Royce vehicles to customers worldwide. This represents a slight decrease of 4% from the previous year, in line with our adjusted guidance.

Market dynamics in China remain weak, which impacted sales performance. However, the BMW brand achieved growth in every other major region.

In Europe, order intake in Q4 improved month by month. In the US, we experienced a strong recovery from IBS in Q4 with growth quarter-over-quarter of just over 50% and year-over-year of 8.9%.

Worldwide BMW Group sales performance in Q4 saw sequential improvement over Q3. Global deliveries grew by nearly a third quarter-on-quarter including double digit growth coming from the mid- and upper-segment together. 

All-electric vehicles remained a key growth driver for us. BEV deliveries totaled over 426,000 units for the year, significantly above 2023 by 13.5%. Overall, BEVs therefore made up 17.4% of total sales.

Our plug-in hybrid vehicles also remained very popular, with over 166,000 units sold in 2024. Electrified vehicles – meaning all-electric vehicles and plug-in hybrids – made up nearly a quarter of total sales.

Revenues in the Automotive segment amounted to nearly 125 billion euros, a decrease of 5.6% from 2023.

Earnings before interest and taxes reached 7.9 billion euros. This resulted in an EBIT margin of 6.3%, which was within our adjusted guidance corridor of 6 to 7 percent for the full year.

Excluding the 1.3 billion euros depreciation resulting from the purchase price allocation of BBA, the Automotive EBIT margin came in at 7.4% for the year.

SLIDE: Automotive EBIT Development in FY24

Looking to the operating result in detail:

Compared to 2023, EBIT for full-year 2024 saw a tailwind of 1 billion euros from the net balance of currency and raw material positions.

Year on year, the net effect of volume, model mix and pricing weighed on Automotive EBIT. The headwind resulted partly from the volume decrease, particularly in China. Pricing headwinds, including the effects of a highly competitive Chinese market and dealer compensation in China, amounted to more than half of the overall decrease of 4.4 billion euros.

The headwind of 1.4 billion euros from Other cost changes was driven by inflation in material costs and supply chain support.

The effect from warranty expenses was a tailwind year-on-year. Overall, lower additions to warranty provisions for specific topics were necessary in every quarter throughout 2024 compared to the previous year. An exception was Q3, due to the impact of IBS. For the full year 2024, the P&L impact of quality issues trended in a positive direction year-on-year, as planned.

SLIDE: R&D Expenditure in FY24

SLIDE: Capital Expenditure in FY24

Our R&D activities and investments focused on our ongoing electrification and digitalization strategy across the entire portfolio. As anticipated, R&D and capital expenditure reached peak levels in 2024 – both in absolute terms and in ratio.

Group expenditure for research and development for the full year reached 9.1 billion euros, compared to 7.8 billion euros in 2023. The R&D ratio according to the German Commercial Code was 6.4%, 1.4 percentage points more than in 2023.

Group capital expenditure totaled 9.1 billion euros, an increase from 8.8 billion euros in 2023. This resulted in a capex ratio of 6.4%, compared to 5.7% in 2023.

As we begin to rollout models of the NEUE KLASSE, we will see a decline in R&D and capex. This means in both absolute and relative terms, back towards our strategic corridors of between 4 to 5% for R&D and less than 5% for Capex by 2027 at the latest.

SLIDE: Automotive Segment Free Cash Flow in FY24

Turning to free cash flow – as you know, we steer this on an annual basis.

Starting with EBT delivering a full year result of 7.5 billion euros, working capital contributed positively with 200 million euros to free cash flow. Whilst inventory levels had risen due to sales stops related to IBS in Q3, we managed to successfully reduce stock by 5 billion euros in Q4. As a result, year-end inventory reached nearly the same level as it was at the beginning of the year.

For the full year, the net effect from capital expenditure and depreciation reduced free cash flow by 3.3 billion euros.

The development of provisions reduced free cash flow by 700 million euros.

The position “Other” reflects several positive effects, including interest received.

In line with our adjusted guidance, free cash flow reached 4.9 billion euros in 2024.

This is even after we invested 18.2 billion euros: 9.1 billion euros in CapEx and another 9.1 billion euros in R&D, paving the way for our future, and demonstrating our financial strength.

This strength is underscored by our Automotive net financial assets, which benefitted from the strong development of free cash flow in the fourth quarter. At year end, the Automotive NFA came in at almost 46 billion euros, which is around the same level as the start of the year.

SLIDE: Financial Services Segment in FY24

Moving on to the Financial Services Segment.

New business development in the segment remained robust throughout the year. A total of almost 1.7 million new financing and leasing contracts were concluded, a solid year-on-year increase of nearly 10%.

Overall, new business volume even increased significantly by 12.5% to 64.5 billion euros, due to higher average financing volume per vehicle.

Penetration rates for lease and loan offerings rose by 4.4 percentage points, reaching 42.6%. Without China, the penetration rate was over 50%, with growth in particular in the US and the UK.

Segment earnings before tax amounted to 2.54 million euros and were therefore significantly lower than the previous year. This was mainly due to higher credit and residual value risk costs than in 2023, but well within our expectations. We continue to see gains from the sale of off-lease vehicles, yet at lower levels due to market dynamics.

The credit loss ratio of 0.26% across the entire credit portfolio was well within our expectations and below industry levels.

Return on Equity for the full year reached 15.1%, within our adjusted guidance range of 15 to 18%.

Ladies and Gentlemen,

In our BMW Group Report, you will note that we have voluntarily adopted the full European Sustainability Reporting Standards for the first time as the framework for reporting all sustainability-related disclosures in our combined non-financial statement.

The BMW Group only reports on sustainability topics that have been assessed as “material” according to ESRS. However, this does not mean that topics which are assessed as “not-material” are necessarily less important.

We view sustainability holistically and as a competitive advantage. That is why we disclose our sustainability performance to our investors and customers.

You will note that the implementation of ESRS requirements have contributed over 100 additional pages to our Report. Due to the company-specific materiality assessment, comparability between companies remains limited – even within the same industry.

Indeed, it can be questioned how much value the additional scope and limited comparability offer to stakeholders. Accordingly, we welcome the proposed regulatory changes in the draft of the so-called Omnibus package and look forward to the draft updates and reduced scope of the ESRS.

Ultimately, we want added value for our stakeholders – meaning relevant and concise information. It’s not just about reporting and compliance.

SLIDE: Proposed Dividend and Payout Ratio

One important element of our stakeholder orientation is our shareholder return strategy, which the BMW Group remains committed to.

The Board of Management and the Supervisory Board will propose a dividend of 4.30 euros per share of common stock and 4.32 euros per share of preferred stock to the Annual General Meeting. This results in a total dividend payout of 2.7 billion euros. 

The proposed dividend for 2024 represents a payout ratio of 36.7%. This is within our long-term strategic target range of 30-40% and notably higher than the payout ratio in 2023.

On January 2nd, we began the final tranche of our ongoing second share buyback program, which should be completed by latest April 30th. This will conclude the second program – with 2 billion euros – more than half a year earlier than initially planned.

By this point in time, we will have reduced a total of 47 million shares in circulation since the start of the share buyback authorization in 2022. This corresponds to over 7% reduction in share capital.

At the upcoming AGM, the Board of Management of BMW AG plans to propose an agenda item, seeking a new five-year authorization to acquire treasury shares amounting to up to 10 percent of share capital.

You will have noted that we have made a step change in our approach since 2021. Starting in 2022, we added share buybacks as an additional instrument alongside dividend payments. We have also increasingly used the range of dividend payout corridor. And we increased the share of Automotive free cash flow distributed to shareholders from the previous years’ levels to almost 100% this year.

So, let’s move to the Outlook for 2025.

Looking to the market development:

Due to stabilizing inflation and declining interest rates in many countries, we expect to see a rise in demand.

How will the BMW Group’s sales performance develop this year?

Given the robust economic situation, we anticipate a solid market development in the US. In Europe, we do expect growth driven by electrified vehicles. The market dynamics in China, however, will remain challenging.

For the full year, revenues per vehicle in the Automotive segment are expected to be in the same range as 2024.

Our guidance reflects the current status of our planning, including all the tariff increases in force as of March 12th, 2025.

SLIDE: Outlook 2025

What do we expect for our key performance indicators in 2025?

Let me focus on selected guidance parameters.

In the Automotive Segment we are forecasting a slight increase in deliveries of BMW, MINI and Rolls Royce vehicles.

In terms of profitability, the total impact of the tariff increases in place as of March 12th amounts to approximately 1 percentage point on the Auto EBIT margin. As a result, the EBIT margin is now expected between 5 to 7%. Consequently, Return on Capital Employed in the Automotive segment should be within a range of 9 to 13%.

In the Financial Services segment, we anticipate a Return on Equity of 13 to 16%.

The Group’s pre-tax profit is expected to remain at the previous year’s level.

Starting January 1st, 2025, we have adjusted the outlook range for Group EBT guidance. The existing bandwidth was too narrow to reflect the underlying movements in the segments. For details, please refer to the glossary of the BMW Group Report.

The full outlook for 2025 for all key performance indicators is also available in the BMW Group Report.

For the full year 2025, we expect a free cash flow in the Automotive Segment of over 5 billion euros.

SLIDE: Closing

Ladies and Gentlemen,

The BMW Group remains fully focused on achieving our short-term results without compromising our long-term strategic objectives.

We remain committed to our long-term target corridor of 8 to 10% EBIT margin in the Automotive Segment.

To that end, we are constantly enhancing our operational business to ensure we achieve our strategic priorities and optimize our returns.

So, after the peak in 2024, we not only expect to see a turnaround in R&D expenditure and CapEx in 2025, but also a turnaround in operational costs. And here I mean a cost decrease in nominal terms, covering the effects of inflation. This will become visible over the course of the year.

At the BMW Group, strong brands and emotional products have long built the foundation of our success.

With the technological boost from the NEUE KLASSE across the entire portfolio, we look forward to seeing the benefits from our investments start hitting the road later this year.

- Check against delivery –
 
Statement
Oliver Zipse
Chairman of the Board of Management of BMW AG
Annual Conference 2025
BMW Welt in Munich, 14 March 2025, 08:00 a.m. CET
 
Part I:
 
Good Morning, Ladies and Gentlemen.
 
Welcome to our annual conference.
 
2025 will be a milestone year for the BMW Group in many respects – as we set the course today for our success in the decade to come.
 
Despite volatile global conditions, we remain firmly committed to growth in the current financial year. At the same time, we are bringing our largest future-focused project, the NEUE KLASSE, to the roads.
 
We have a clear plan: We remain sharply focused on innovation and sustainable growth. In 2025, we expect sales figures to rise once again. At the same time capital expenditure will decrease, as planned. This will enable us to increase our free cash flow.
 
There are four reasons for our confidence:
 
 
First:
Our strategy is robust and gives us a clear path forward. We are setting the pace in key areas. Our technology open approach remains successful and is gaining more traction. Policymakers and competitors are pivoting in our direction – which we continue to pursue systematically.
 
Second:
The BMW Group is one of our industry’s few true global players. Our extensive global footprint creates opportunities. It makes us resilient. And it provides the flexibility we need to respond effectively to external influences.
 
Third:
With BMW, MINI, Rolls-Royce and BMW Motorrad, we have four strong brands. All of them are incredibly popular around the globe. Each has its own distinct identity and delivers emotionally compelling products for different target groups.
 
And fourth:
Our NEUE KLASSE: No other manufacturer has a project as ambitious and ground-breaking as ours about to enter production. I will come to this in the second part of my presentation.
 
Let's start with the first topic: our strategic direction.
Our technology-open approach is market-oriented. It allows us to fully leverage the available potential across all markets and regions.
 
We make no distinctions – whether we are talking about combustion engines, plug-in hybrids, all-electric vehicles or, from 2028, a hydrogen-powered car. We consistently implement design principles, innovation and the latest technologies in all our vehicles.
 
No one masters this technological diversity better than we do. Numerous national and international accolades confirm this.
 
Our approach is also gaining increasing recognition in political circles. Even our competitors are pivoting towards our strategy. We have proven that technological openness, growth and CO₂ reduction are very much compatible.
 
Let’s take a look at 2024:
 
We met our adjusted targets for the year. We delivered more than 2.45 million vehicles and achieved an EBIT margin of 6.3 percent in the Automotive Segment.
 
Our vehicles with highly efficient combustion engines remain in strong demand worldwide. At the same time, battery-electric vehicles continue to be our main growth driver.
 
Several other manufacturers – including some that only produce electric cars – saw a decline in sales. But we achieved growth with our all-electric vehicles. Even in challenging market conditions. In 2024, BEV sales once again climbed significantly year-on-year – increasing by more than 13 percent.
 
Fully-electric vehicles accounted for over 17 percent of total sales last year. Including plug-in hybrids, nearly one in four vehicles sold was electrified.
 
We are targeting further growth in e-mobility in 2025. We will hit two major milestones this year: We will reach the total of more than three million electrified vehicles and over 1.5 million BEVs sold since the launch of the BMW i3 and BMW i8.
 
Our customers can choose between over 15 BEVs across all our brands. One example is the new edition of the BMW iX*: The recently presented model update boasts an impressive electric range of over 700 kilometres in the WLTP cycle – with significantly more drive power.
 
That is BMW EfficientDynamics.
Our combination of electrified vehicles and highly efficient combustion engines also has a positive impact on our climate footprint. In 2024, the BMW Group once again outperformed its European CO2 fleet target – by more than 30 grammes. Based on our internal calculations, our fleet emissions fell below 100 grammes per kilometre in the WLTP cycle for the first time.
 
We will continue to ensure that our customers always have access to the latest technology – across all drivetrains. The key to achieving this lies in our production network’s high level of flexibility.
 
That brings me to my second point:
our global footprint.
 
The BMW Group is a true global player. Very few automotive manufacturers have such a comprehensive presence across all relevant economic regions as we do. Be it in sales, research and development, production or our supplier network. This combination gives us a strategic advantage that sets us apart from the competition in an increasingly fragmented world.
 
We remain committed to expanding our local for local approach. We are constantly improving our access to different market regions and strengthening our resilience, especially along supply chains.
One example of this is our high-voltage battery assembly plants in the three major sales regions: Europe, the Americas and China. In total, five new assembly facilities for the next generation of high-voltage batteries are being built near our production sites worldwide – complete with a local supplier network. In this way, we are already creating the necessary conditions today for successful growth in the future.
 
We are gradually adapting our production network to rising sales of electric vehicles. Late this year, our new plant in Debrecen, Hungary will become our first facility to exclusively produce all-electric vehicles. Our main plant in Munich will follow in 2027.
 
Our production follows the market and our product range aligns with demand. We build roughly the same number of vehicles in our three key market regions of Europe, the US and China as we sell there. This balanced distribution is another key differentiator for the BMW Group.
 
At the same time, Germany and the US serve as key export hubs for us. In 2024, we manufactured over one million vehicles at our plants in Germany. This represents about a quarter of the country’s total car production. 56 percent of these vehicles are then exported outside the European Union.
An impressive proof of the BMW Group's significant contribution to industrial value creation in Germany.
 
In the US, one out of every two vehicles from our Plant in Spartanburg, South Carolina, is exported. Last year, we achieved an export value of over 10 billion US dollars. This once again makes the BMW Group the largest automotive exporter in the United States by value. We benefit from an integrated global economy. That is why we continue to advocate for open markets and free trade.
 
Third point: the performance of our brands.
 
The success of the BMW Group is built on the global appeal and resonance of our four brands. At the same time, we know how to fulfil the specific needs and preferences of our customers in different markets with our products.
 
Last year, our core BMW brand leveraged its strength to the full: In three out of four regions, BMW grew sales and gained market share. This has enabled BMW to maintain its number one position in the global premium segment.
 
BMW performed particularly well in Europe. Italy, Spain, France and the UK led the way, with all reporting double-digit growth rates.
With a six-percent increase, the brand significantly outperformed the overall European market, which only grew by just over one percent.
 
In the US market, we achieved record sales for the second consecutive year. Here, too, the strength of our market-driven approach to drivetrains is delivering results. Thanks to our steadily growing BEV portfolio, we sold more than 50,000 electric vehicles in the US for the first time. With this momentum, we are optimistic about the year ahead, as we celebrate “50 years of BMW North America”.
 
In our markets outside the main sales regions, we also posted growth, in a declining environment overall. In this region, we lead the premium segment in total for the first time ever. The main growth drivers here included the South Korean, Australian and Indian markets.
 
China remains a key market for the BMW Group. In 2024, we sold more than a quarter of all our vehicles there. The market is highly dynamic and characterised by increased competitive pressure. In this environment, BMW maintained nonetheless its position as the number one in its segment with a market share of three per cent. This put us within our target range.
 
In 2024, we delivered over 100,000 BEVs to customers in China for the first time. This makes China our biggest single market for electric vehicles – even though our sales performance there was dampened last year by persistently low consumer sentiment.
 
The high-margin vehicles built by BMW M once again played an important role in our market success in 2024. For the 13th consecutive year, M sales increased. Nearly one in ten BMWs sold carried the letter M. Demand for the sportiest BMW models has continued to grow, especially in China.


2025 is the first year with the complete New MINI Family available. And we will exploit this potential.
 
There are a total of five unique models to choose from – three of them BEVs. The fully-electric MINI models – with the MINI Cooper Electric* leading the way – are being particularly well received. With an increase of 24 percent year-on-year, sales of MINI BEVs also saw highly dynamic growth last year. Nearly one in four MINIs is now powered by an electric heart.
 
In the ultra-luxury segment, Rolls-Royce continues to set the benchmark. At more than 5,700 units, Rolls-Royce sales remain high.
Most notably, the all-electric Spectre exceeded expectations in its first full year of sales. Every third Rolls-Royce sold is now fully-electric.
 
BMW Motorrad also impressed in 2024, achieving a new all-time sales high of over 210,000 units. BMW Motorrad remains the undisputed number one in the global premium motorcycle segment.
 
Ladies and Gentlemen,
 
All of this shows that the BMW Group is well positioned across all brands, drive technologies and segments to continue on its growth path. With our global approach, we have the right answers to challenges worldwide. This has often enabled us to offset fluctuations in demand in individual markets.
 
Now, it is time for Walter Mertl to present the Group Financial Statements for 2024 and look ahead to our goals for 2025.

 
Part II:
 
Ladies and Gentlemen,
 
Growth and innovation – these are two of the main topics we will be focusing on this year. At the same time, we stand on the threshold of a new era.
 
Late this year, we will launch our NEUE KLASSE: a project that is unprecedented in both form and significance in the history of the BMW Group.
 
With the NEUE KLASSE, we will be turning the mobility of the future into reality. Driving dynamics, drivetrain, battery technology, operating concept, digitalisation: We have refined each of these aspects and, in the case of design, even skipped a generation.
 
In this way, we are redefining not only the BMW brand, but also the future of individual mobility.
 
Standing here next to me is the BMW Vision Neue Klasse X: the series version of this vehicle will kick off the NEUE KLASSE. Production will ramp up at our new plant in Debrecen late this year.
After that, the rollout will continue in rapid succession, including a sporty sedan at the core of the BMW brand in 2026.
 
We are deliberately starting out in high-volume segments: We want our innovations to have a broad impact, not just in niche segments.
 
Between now and 2027, we will release more than 40 new or updated BMW models onto the market – from electric to plug-in hybrid to vehicles with combustion engines. Each will have the DNA of the NEUE KLASSE.
 
The NEUE KLASSE is BMW and BMW is the NEUE KLASSE.
 
The NEUE KLASSE is more than just a single vehicle. It marks the beginning of a completely new generation and introduces our technology boosters for the entire brand. Regardless of the drive technology, all future BMW models will benefit from the technologies of the NEUE KLASSE – and, of course, also from the new design language.
 
Allow me to share a few examples of our groundbreaking advances in technology:
 
With the BMW Panoramic iDrive, we are re-imagining our typical BMW driver orientation. The all new BMW Panoramic Vision is the centrepiece. This newly-developed additional Head-Up Display projects content across the full width of the windscreen.
 
Seamless integration of various display and operating elements enables a completely new level of intuitive interaction. From the launch of the very first model of the NEUE KLASSE, all future BMW models will come with BMW Panoramic iDrive.
 
The sixth generation of our BMW eDrive technology will make e-mobility even more appealing to our customers. The new BMW round cells promise 20 percent higher energy density, 30 percent faster charging and at least 30 percent more range. And within just 10 minutes, enough energy for another 300 kilometres can be recharged.
 
For the first time, the Gen6 high-voltage batteries also feature the latest 800-volt technology and enable bi-directional charging. Compared to the current fifth generation, we will reduce the cost of the high voltage battery by 40-50 percent, on a comparable electric range basis.
 
The electronics architecture has also been completely redesigned. Going forward, its four high-performance computers will control key customer functionalities. For example driving dynamics, automated driving and infotainment.
 
These “super-brains” deliver more than 20 times the in-vehicle computing power than current systems. This makes our models future-proof for software and function updates, as well as new AI features.
 
We have also greatly simplified the electrical system, dividing it into four zones, with intelligent control. 600 metres less wiring, a 30 percent reduction in weight and a 20 percent increase in energy efficiency are just some of the improvements we will achieve with this.
 
And, of course, we are also harnessing technical opportunities to take driving dynamics to a whole new level.
 
The BMW Vision Driving Experience showcases the potential of the technologies introduced in the NEUE KLASSE. We are pushing driving dynamics to its physical limits.
 
This highly emotional driving machine will thrill more than just BMW fans.
 
The VDX is the most powerful development prototype BMW has ever built. We are using it to test our “Heart of Joy” – one of the four super-brains in the NEUE KLASSE.
 
We developed the software for the driving dynamics control system entirely in-house. This will be used in all future electric BMW models, setting new standards for dynamic performance and efficiency.
 
It is hard to put into words exactly how it feels behind the wheel. You simply have to experience it.
 
Take a look for yourselves at what our “Heart of Joy” can do, paired with a maximum torque of 18,000 Newton meters.
 
You can't fake that kind of enthusiasm. Our Board of Management already had the chance to drive the series version of the NEUE KLASSE. Let me tell you: We were all equally excited about the driving experience – but not just in terms of pushing the physical limits. Most importantly, we were deeply impressed by the added value our technologies create for our customers in everyday situations.
 
This is truly the next level of Sheer Driving Pleasure.

Ladies and Gentlemen,
 
We first announced the NEUE KLASSE at our Annual Conference back in 2021. Today, just four years later, we are entering the final stretch.
 
Standing next to me is one of the prototype vehicles we have been producing in Debrecen since late last year.
 
What is still hidden under camouflage foil here will be unveiled at the IAA MOBILITY in Munich in early September. There we will present the production model that will be available to our customers.
 
I can already reveal one key detail to you today: this BMW will be released onto the market as the BMW iX3. This is how we continue the success story of the first all-electric BMW X model that has won over BMW fans worldwide since 2020.
 
Testing of the BMW iX3 is in full swing.
 
These impressions show that the next BMW iX3 is a typical X model, and a BMW through and through. As I’m sure you saw at the end of the film: The final phase of development for the sporty sedan, the second NEUE KLASSE vehicle, is also progressing rapidly.
Ladies and Gentlemen,
 
What has always set the BMW Group apart is that we keep our sights set on operational performance in the here and now. At the same time, we lay the foundation for our long-term future success.
 
We will continue to consistently pursue our BMW path – with foresight, customer focus, self-confidence and in the knowledge of our strengths.
 
We are ready. More than ever.
 
Thank you.