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BMW Company Analysis

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by

Matt Edwards

on 27 April 2014

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Transcript of BMW Company Analysis


Introduction
Founded in 1916 in Milbertshofen-Am Hart, Germany
Headquarters in Munich, Bavaria, Germany
Current CEO: Norbert Reithofer
World's most sustainable automotive company
SWOT Analysis
Solution
Strategies
Industry Analysis
Financial Analysis
Average Growth Rate for Revenue- 27%
Projected Revenue for 2014 $97,00,000
Up 63% from 2009
BAMX Y- $42.08 (4/24/14)
Conclusion
Mission
"The BMW Group is the world's leading provider of premium products & premium services for individual mobility."
Vision
Corporate
Get Bigger (offensive)
Concentration
Product Development
Diversification
Joint Ventures = BRIC Market
Alliances = Fiat & Alfa Romeo

SBU / Advanced Divisional Structure
BMW
Mini
Rolls Royce
BMW Motorrad
Business
Niche Differentiation
Product -
Luxury vehicles that have an attractive design & powerful engine
Price -
Premium
Place -
HQ = Munich, Germany
Promotion -
Seasonal offers, TV, Internet, magazines, newspapers, etc.
Target Market -
Ages 25 to 45, wealthy, upper-middle class, professional employees, leading positions
Functional
Marketing
E-marketing
Social Media

Research and Technology
First self-driving car that is capable of drifting
Porter's 5 Forces
Threat of New Entrants (Low)
Threat of Substitutes (Medium)
Power of Supplies (Medium)
Power of Buyers (Medium)
Competition (Extremely High)
Key Success Factors
Branding
Brand Loyalty
Brand Awareness
Global Presence
Established Markets
Growing Markets
Innovation Rate
Lightweight Engineering
User Interface
Driving Forces of Change
Political Factors
Economic Factors
Sociocultural Factors
Technological Factors
Strengths
Brand Reputation
Environmentally Friendly Vehicles
Quality Products
Weaknesses
High Cost Structure
Perception of High Prices
Too Few Acquisitions and Strategic Partnerships
Rejected
Make all parts "in-house"
Recommended
Institute a "Testing/Quality Maintenance" Department
Key Ratios
The Good:
Dividend Policy
$10,690,000 in FCFE
$1,366,000 Dividends Paid in 2012
Paid 12.8% in dividends
The Future of BMW
Continued long-term growth
BMW Vision Future Luxury concept
Increased sustainability
More fuel efficient/ low emission vehicles
Questions?
Matt Edwards
Chrissie Parsons
Jen Bryan
Matthew Brinkley

Threats
Opportunities
Defense
The central problem is the manufacturing quality of BMW's automobiles.

Positive Attitude Towards "Green" Vehicles
Expand Brand Portfolio
Changing Customer Needs
Intense Competition
Rising Raw Material Prices
Competitive Products Offered at Lower Cost
Monetary cost and brand image ramifications

Unnecessary defects sacrificing market share

Law suits and negative criticisms
Pros:
Quality Assurance
Improve Image
Lower Supply Chain Costs

Cons:
High Labor Costs
High Raw Materials Costs
Potential Lack of Buying Power
Loss of professional relationships
Pros:
Improved Customer Assurance
Quality Control
Less Start Up Costs
Cons:
Labor Costs
Time associated with opening new department
Central Problem
"Three brands, one vision- to become better."
Why is this Important?

Total Debt Ratio- .77
Beta- 1.19
Dividend Yield- 2.81
The Bad
Potential Investor Valuation
Future Stability
Potential for more equity
ROA-3.95
Inventory Turnover- 6.30
Full transcript