euro adhoc: Bayerische Motoren Werke Aktiengesellschaft / Strategic management decisions / BMW Group Announces Future Strategic Realignment

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27.09.2007

BMW Group Announces Future Strategic Realignment

. New strategy focuses on increasing value
. RoCE target for Automobile segment is 26% as of 2012
. Program approved to tap euro 6 billion in efficiency potential by 2012
. Shareholders to benefit to a greater extent from company success
. Automobile retail sales to rise to significantly more than 2 million units
by 2020

Munich - The BMW Group has set the course for a successful future
with its strategic realignment. In their joint meeting on Thursday,
the Board of Management and the Supervisory Board of BMW AG approved
the cornerstones of the corporate strategy through 2020. The BMW
Group's goal is to resolutely maximize profitability and increase
value over the long term. The Group's strategic direction up to
2020 is clearly defined: The BMW Group is the world's leading
provider of premium products and premium services for individual
mobility.

This strategic realignment includes, among other items, the following
measures:

Capital-Efficiency Targets

The BMW Group intends to focus even more on the return on capital
employed when monitoring company performance. The company set
itself the following interim targets: The BMW Group aims to
achieve a return on capital employed before taxes (RoCE) of 26%
in the Automobile segment as of 2012. This results in an
EBIT-based return on sales of between 8% and 10% for the Automobile
segment.

Program to tap into efficiency potential

In order to achieve earnings targets for 2012, the BMW Group will
launch a program to increase profitability. This will encompass all
divisions and apply to both performance and costs. In terms of
performance, the company plans to increase revenues and earnings
per vehicle, while in terms of costs, it plans to reduce
development, production, sales and administration costs per
vehicle to achieve a cumulative efficiency effect of about 6 billion
euros by 2012. The company intends to employ less capital than
today when generating further growth. To this end, the BMW Group
intends to reduce its capital expenditure ratio as well as capital
employed per vehicle by 2012.

Growth Targets

The BMW Group is going to continue its product initiative. The BMW
Group aims to achieve retail sales of more than 1.8 million vehicles
by 2012. By then, the BMW Group plans to increase deliveries in the
motorcycle business by 50% to 150,000 units per annum. The
company intends to increase retail sales in the automobile
business to clearly more than two million vehicles by 2020.

Change in Dividend Policy/Significantly Higher Dividend Planned for
2007

The Board of Management is convinced that the BMW Group's continued
strategic development will be successful over the long term.
Therefore, the company plans to increase its dividend payout ratio
substantially. The Board of Management will propose a first step for
the business year 2007 to the Supervisory Board and the Annual
General Meeting. In addition, BMW AG will keep the option of
conducting a share buyback. However, this step is not planned for the
next twelve months.

Funding out Pension Obligations

BMW AG will gradually fund out its pension obligations in Germany
of about 4 billion euros in three steps starting in 2008.

Natural Hedging and Purchasing in US Dollars to be Expanded

In order to strengthen independence from currency fluctuations, the
BMW Group will strategically step up natural hedging as well as
purchasing in US dollars in particular.

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Further details on the company's strategic realignment will be
communicated at a press conference on Thursday, September 27, 2007,
which will be held from 3:00 p.m. to 4:00 p.m., and during an
analyst conference call from 5:00 p.m. to 6:00 p.m.

end of announcement euro adhoc 27.09.2007 13:18:25
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ots Originaltext: BMW AG
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:
Bill McAndrews
Tel.: +49(0)89 382 22332
E-Mail: Bill.McAndrews@bmw.de

Marc Hassinger
Tel.: +49(0)89 382 23362
E-Mail: Marc.Hassinger@bmw.de

Branche: Automotive Equipment
ISIN: DE0005190003
WKN: 519000
Index: DAX, CDAX, HDAX, Prime All Share
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