International business strategy bmws success in the automotive market

In an increasingly interconnected world, businesses face remarkable opportunities and challenges to expand their operations across borders. International business strategy has emerged as a vital framework for businesses to navigate the complexities of global markets effectively. By developing a welldefined international business strategy, organizations can align their objectives, design a plan for success, and secure longterm growth in the global marketplace. The importance of international business strategy lies in its ability to provide businesses with a comprehensive approach to entering and operating in foreign markets. It goes beyond mere expansion and encompasses a holistic understanding of cultural, political, economic, and legal factors that influence business operations globally. Whether an organization aims to tap into new customer segments, diversify its revenue streams, or gain a competitive edge, a wellcrafted international business strategy is essential. Therefore, we group 10 would like to research a significant business strategy: the truth behind BMW’s success. Today, the BMW Group, with more than 30 production and assembly facilities as well as a global sales network, is the worlds leading manufacturer of premium automobiles and motorcycles, and provider of premium financial and mobility services, then it is undeniable the role of suitable international business strategy for longterm development. This report is structured as below: • Section 1: Background information: Luxury automotive industry, an overview of BMW. • Section 2: Analysis of international business strategies of BMW With limited knowledge and time allowance, our report cannot be free from mistakes. Our team is eager to receive feedback from PhD.Nguyen Hong Hanh to improve the report’s content and structure.

FOREIGN TRADE UNIVERSITY FACULTY OF ECONOMICS AND INTERNATIONAL BUSINESS

MIDTERM REPORT INTERNATIONAL BUSINESS STRATEGY: BMW'S SUCCESS IN THE

AUTOMOTIVE MARKET

GROUP Instructor: Ph.D Nguyen Hong Hanh Class: KDOE307

Ha Noi, June 2023

1 | P a g e

TABLE OF CONTENT

TABLE OF CONTENT 1

TABLE OF FIGURES 2

INTRODUCTION 3

Section 1 : Background Information 4

I Overview of the automotive industry 4

1 Size and scope 4

2 Market Trends and Innovations: 6

II Overview of the luxury automotive industry 7

1 Size and scope 7

2 Key players: 8

3 Characteristics: 8

4 Opportunities 9

5 Challenges: 10

III Overview of BMW 10

1 Introduction to BMW 10

2 BMW's History 14

3 Vision and Mission: 14

4 BMW’s Internationalization: 15

Section 2 : Analysis on international business strategies of BMW 16

I The value chain analysis 16

1 BMW’s Primary Activities: 16

2 BMW’s Supporting Activities: 28

II Rationale behind chosen IBS of BMW 31

1 External factors 31

2 Internal factors: The VRIO analysis 32

III BMW's international business strategies: Transnational strategy 38

CONCLUSION 42

REFERENCES 43

TABLE OF FIGURES

Figure 1: Automobiles production statistics in 2022 4

Figure 2: Global automotive manufacturing industry revenue from 2019 to 2022 5

Figure 3: The World's Top Ten Largest New Car Markets In 2022 6

Figure 4: Luxury car market trends by region in 2022 8

Figure 5: The regional mix of BMW purchase volume 2022 (BMW Group Report 2022) 17

Figure 6: BMW Group largest motorcycle markets in 2022 (BMW Group Report 2022) 20

Figure 7: BMW Group's largest automobile markets in 2022 (BMW Group Report 2022) 20 Figure 8: BMW Group Outbound Logistics at a glance in 2016 22

Figure 9: BMW's spending on employee training and development 30

Figure 10: Best brand 2022 33

In an increasingly interconnected world, businesses face remarkable opportunitiesand challenges to expand their operations across borders International business strategy hasemerged as a vital framework for businesses to navigate the complexities of global marketseffectively By developing a well-defined international business strategy, organizations canalign their objectives, design a plan for success, and secure long-term growth in the globalmarketplace

The importance of international business strategy lies in its ability to providebusinesses with a comprehensive approach to entering and operating in foreign markets Itgoes beyond mere expansion and encompasses a holistic understanding of cultural, political,economic, and legal factors that influence business operations globally Whether anorganization aims to tap into new customer segments, diversify its revenue streams, or gain

a competitive edge, a well-crafted international business strategy is essential

Therefore, we- group 10 would like to research a significant business strategy: thetruth behind BMW’s success Today, the BMW Group, with more than 30 production andassembly facilities as well as a global sales network, is the world's leading manufacturer ofpremium automobiles and motorcycles, and provider of premium financial and mobilityservices, then it is undeniable the role of suitable international business strategy for long-term development

This report is structured as below:

 Section 1: Background information: Luxury automotive industry, an overview ofBMW

 Section 2: Analysis of international business strategies of BMW

With limited knowledge and time allowance, our report cannot be free from mistakes Ourteam is eager to receive feedback from PhD.Nguyen Hong Hanh to improve the report’scontent and structure

Section 1: Background Information

I Overview of the automotive industry

1 Size and scope:

The automobile industry is a broad and significant sector with numerous operationsand players It is one of the most important sectors in the world, having a major economicinfluence and worldwide reach

Production: The automotive industry is a major global producer of vehicles.According to the International Organization of Motor Vehicle Manufacturers (OICA), morethan 85 million vehicles were produced worldwide in 2022 (OICA, 2023) This productioncomprises a variety of vehicles, including cars, commercial vehicles, and motorbikes.Different regions contribute to this production, with major automobile-producing countriessuch as China, Japan, India, Germany, and South Korea leading the way

Figure 1: Automobiles production statistics in 2022

Employment: The automotive industry is a significant global employer, offeringmillions of jobs across various sectors These jobs include car production, research anddevelopment, design, engineering, marketing, and sales Additionally, the industry has asubstantial indirect impact on employment through its supply chain, involving component,

material, and service providers According to the International Labour Organization (ILO) in

2021, the automotive industry employs millions of people worldwide, encompassing bothskilled and unskilled workers involved in the production, distribution, and maintenance ofautomobiles The availability of job opportunities in this sector is expected to benefitindividuals and communities greatly

Revenue and economic impact: The automobile sector generates substantial incomeand exerts a significant economic influence at both national and global levels This is primarilyachieved through vehicle sales, replacement parts, accessories, and related services.According to Statista's report in 2022, the global revenue of the automotive industry reached2.95 trillion U.S dollars Moreover, the automobile sector plays a vital role in nationaleconomies, contributing to GDP, tax revenue, and exports in many countries Automakers andtheir supply chains have a multiplier effect on the economy, creating jobs, driving demandfor raw materials, and fostering technological advancements The industry's economicinfluence extends beyond manufacturing to sectors such as steel, plastics, electronics, andtransportation services

Figure 2: Global automotive manufacturing industry revenue from 2019 to 2022

Global market reach: The automotive industry has a wide market reach, with vehiclesbeing sold and used in virtually every country Automobile markets in different areas andnations differ due to differences in customer preferences, legal frameworks, andinfrastructure China, the United States, India, Japan, and Germany are major automotivemarkets, accounting for a sizable part of worldwide car sales in 2022 (Munoz, 2022).Furthermore, the automotive industry encompasses more than just the manufacture and sale

of new cars The aftermarket industry, which includes vehicle maintenance, repairs,replacement parts, and accessories, is also a substantial component This industry providesservices and goods to meet the continuous demands of car owners, contributing to the totaleconomic activity in the automotive ecosystem

Figure 3: The World's Top Ten Largest New Car Markets In 2022

2 Market Trends and Innovations:

Electrification: One of the prominent trends in the automotive industry is theincreasing adoption of electric vehicles (EVs) As governments across the world tightenemission regulations to combat climate change, automakers are rapidly investing in EVtechnology According to McKinsey, global sales of EVs are expected to increasesignificantly in the coming years, driven by falling battery costs and improved charging

infrastructure (McKinsey & Company, 2022) For instance, Tesla, a major electric carmanufacturer, has had significant

success with its Model S, Model 3, and Model Y, contributing to the widespread acceptance

of EVs

Lightweight Materials: Automakers are increasingly using lightweight materials, such

as aluminum and composites, to improve fuel efficiency and reduce emissions (Stewart,2020) These materials offer strength while reducing the overall weight of vehicles, therebyenhancing performance and reducing fuel consumption For example, BMW's adoption ofcarbon fiber reinforced plastic (CFRP) in its i3 electric vehicle demonstrates the use oflightweight materials to achieve sustainability goals (BMW Group, 2013)

Autonomous driving: Companies are now rapidly investing in advanced driver-assistancesystems (ADAS) to enable self-driving capabilities Autonomous vehicles have the potential

to enhance safety, reduce traffic congestion, and provide increased mobility options forindividuals with limited mobility Leading automakers such as Waymo (owned by AlphabetInc.) and traditional manufacturers namely General Motors are investing in self-drivingtechnology and performing extensive testing on public roads (Waymo, 2021)

II Overview of the luxury automotive industry

1 Size and scope:

The luxury automotive industry caters to wealthy consumers seeking high-end vehicles withexceptional quality and performance In 2022, the global luxury car market reached $617.36billion, expected to grow at a CAGR of 6.9% from 2023 to 2030 Europe dominates themarket with a 39.3% share and is projected to grow at a CAGR of over 6.1% The Asia-Pacific region is expected to grow at the highest CAGR of 8.2% due to increasingprosperity, changing

consumer habits, government incentives for electric vehicles, and rising corporate profits.

Figure 4: Luxury car market trends by region in 2022

2 Key players:

Some key players operating in the luxury car market include Mercedes-Benz Group

AG, BMW Group, Volkswagen, Tesla, TOYOTA MOTOR CORPORATION (Lexus),Volvo Car Corporation, JAGUAR LAND ROVER AUTOMOTIVE PLC (Tata Motors), andAston Martin These industry giants have a long history of producing high-quality vehiclesand have built a strong brand reputation over the years They have a global presence andoperate in multiple markets worldwide and invest heavily in improving vehicle performance,safety, unique design and environmental sustainability, catering to the discerning tastes andpreferences of luxury car buyers

3 Characteristics:

One defining characteristic of the luxury automotive industry is the emphasis onsuperior design and engineering The emphasis on great design and engineering is adistinguishing feature of the luxury vehicle sector Luxury automobiles stand out by their

thorough attention to detail, unique features, and use of high-quality materials.Manufacturers spend a lot of money to guarantee that their cars have cutting-edgetechnology, maximum performance, and unrivaled comfort Rolls-Royce and Bentley, forexample, are known for their handmade interiors, whilst Ferrari and Lamborghini are knownfor their extraordinary speed and driving dynamics.

Notably, customization has emerged as a major trend in the luxury automobile sector.Customers in this group are looking for individualized experiences and features that suittheir distinct preferences and lifestyles Customers can choose particular materials, finishes,colors, and even tailor-made features to create a completely personalized car whenpurchasing a luxury vehicle This amount of customization adds to the exclusivity and sense

of luxury associated with these vehicles

4 Opportunities

The rise of emerging markets and the increasing affluence of consumers in regionslike China, India, and the Middle East present a significant opportunity for luxuryautomakers As disposable incomes rise, more consumers can afford luxury vehicles,leading to an expanding customer base

The shift towards electric and hybrid vehicles provides an opportunity for luxuryautomakers to tap into the growing demand for sustainable transportation By developingand offering high-performance electric and hybrid models, luxury brands can attractenvironmentally conscious customers while maintaining their reputation for luxury andperformance

The luxury segment thrives on exclusivity and individuality Offering extensivecustomization options allows luxury automakers to cater to the unique preferences ofcustomers By providing bespoke features, materials, and finishes, brands can create a sense

of personalization and reinforce their image of luxury and exclusivity

Rapid advancements in technology provide opportunities for luxury automakers tointegrate cutting-edge features and innovations into their vehicles This includes advanceddriver-assistance systems, connectivity solutions, autonomous driving capabilities, andimmersive infotainment systems Embracing these technologies can enhance the drivingexperience and attract tech-savvy luxury car buyers.

5 Challenges:

The luxury automotive industry faces challenges due to economic downturns, strictemissions regulations, trade barriers, intense competition, changing consumer preferences,regional variations, and geopolitical uncertainties Economic uncertainties, such asrecessions, can decrease consumer confidence and purchasing power, leading to lowerluxury vehicle sales Stricter emissions regulations require significant investments in eco-friendly technologies, failure to comply can result in fines and damage to reputation

Trade barriers and tariffs impact the global supply chain, requiring automakers to carefullychoose production sites Intense competition from established and new brands puts pressure

on pricing, differentiation, and market positioning Changing consumer preferencesprioritize sustainability and shared mobility options, necessitating transformation in luxuryautomakers' strategies Regional variations in consumer demands require adaptation toappeal to different markets Geopolitical concerns and trade disputes can disrupt the globalsupply chain, causing higher costs and logistical issues Tariffs on vehicle imports affect theprofitability and operations of luxury manufacturers To thrive in this industry, automakersmust navigate these challenges, innovate, differentiate their offerings, and adapt to marketconditions

III Overview of BMW

1 Introduction to BMW

BMW, short for Bayerische Motoren Werke, is a renowned German automobilemanufacturer that has established itself as a symbol of luxury, performance, and innovation

in the global automotive industry

BMW was founded in 1916 and has been widely traded since 1969 The company’s slogan

in English is “The Ultimate Driving Machine” and “Sheer Driving Pleasure” The originalGerman slogan is “fraud am Fahren,” which translates to “Joy in Driving” in English

BMW is headquartered in Munich, its operational stores are present worldwide In total,there are 31 product-oriented service stores in 15 countries

1.1 BMW's Market:

BMW is a German multinational corporation that produces luxury vehicles and motorcycles.The company operates in the automotive industry and competes with other luxury car brandssuch as Mercedes-Benz, Audi, and Lexus BMW has a global presence and sells its products

in over 150 countries worldwide

BMW's sales are concentrated in certain regions where it has a particularly strong marketshare For example, Europe is BMW's largest market, accounting for around 45% of thecompany's sales Within Europe, BMW has strong sales in Germany, the UK, and Italy TheUnited States is also a significant market for BMW, accounting for around 20% of its sales

In recent years, BMW has also been focusing on expanding its presence in emergingmarkets such as China and India, where it sees significant growth potential China hasbecome BMW's largest market in terms of sales volume, accounting for around 30% of thecompany's global sales BMW also has a significant presence in other Asian markets,including Japan, South Korea, and Singapore

- Sporty Cars: BMW's sporty cars are designed to be more performance-oriented thanluxury cars These models typically have more powerful engines, sportiersuspensions, and more aggressive styling Examples of BMW's sporty cars includethe 2 Series, 4 Series, and 8 Series.

- SUVs: BMW's SUVs are aimed at customers who want the space, practicality, andversatility of an SUV, combined with BMW's signature performance and luxury BMWoffers a range of SUVs, from the compact X1 to the full-size X7

- Motorcycles: BMW has been producing motorcycles since 1923 The company'smotorcycle range includes adventure bikes, touring bikes, roadsters, and sports bikes.Some of BMW's most popular motorcycle models include the R 1250 GS adventurebike, the K 1600 GT touring bike, and the S 1000 RR sports bike

1.3Price Range:

BMW's products are generally positioned as high-end and luxury, and as such, they tend to

be priced accordingly The price range for BMW cars can vary depending on the model andthe options selected but typically ranges from around $35,000 for the entry-level 2 Series towell over $100,000 for the top-of-the-line 7 Series BMW motorcycles generally range inprice from around $10,000 to $25,000 or more, depending on the model and features

1.5 Customer Service:

BMW focuses on customer-oriented service that consider customer priority, so that has areputation for providing high-quality customer service

Some highlights in BMW’s service apart from other luxury cars can be:

- Customized Service: BMW provides customers with a highly personalizedexperience by granting them the freedom to select their preferred options and featuresfor their vehicles This empowers customers to tailor their cars according to theirspecific requirements and preferences

- Comprehensive Warranty Coverage: BMW extends a comprehensive warranty to allits vehicles, encompassing a 4-year/50,000-mile limited warranty, a12-year/unlimited mileage rust perforation warranty, and a 4-year/unlimited mileageroadside assistance program This extensive coverage ensures peace of mind forBMW owners

- Digital Services: BMW offers a diverse range of online services to facilitate efficientcar management and seamless communication with authorized dealerships Theseservices encompass online service scheduling, real-time traffic updates, and remotevehicle control, among others

- Devoted Customer Support: BMW boasts a dedicated team of customer supportprofessionals who are readily available round the clock to address any inquiries orconcerns customers may have Customers can easily reach out to this team via phone,email, or live chat for prompt assistance

- Commitment to Service Excellence: BMW has established a solid reputation fordelivering exceptional service to its clientele, whether it be through its network ofdealerships, customer support team, or online platforms This unwaveringcommitment to service excellence has contributed to the brand's loyal customer baseand sustained its esteemed status as a premier automotive brand

With a rich history spanning over a century, BMW has consistently delivered exceptionalvehicles that embody cutting-edge technology, distinctive design, and an unparalleleddriving experience From its humble beginnings to its current status as one of the world'sleading premium carmakers, BMW's journey is marked by a commitment to excellence and

a relentless pursuit of automotive perfection

2 BMW's History

BMW made its foray into the automotive industry in 1928, and its R32 motorcycle set aworld speed record that remained unbroken until 1937 Notably, during World War II,BMW played a pivotal role by manufacturing the world's first jet aeroplane engines, whichwere utilized by the German air force, known as the Luftwaffe Post-war, the companyventured into the small- car market but faced stiff competition from Volkswagen's compactand affordable vehicles, rendering it unable to compete effectively By 1959, BMW founditself on the brink of insolvency, prompting its managers to contemplate selling the company

to Daimler-Benz

However, BMW's fortunes turned around that very year when German entrepreneur HerbertQuandt acquired a controlling stake in the company This marked the beginning of BMW'srevival, accompanied by the successful launch of its 700 series, followed closely by theequally well-received 1500 model Simultaneously, BMW introduced a new range ofmotorcycles, which gained considerable popularity, particularly in the United States

By the end of the 20th century, BMW had established itself as a prominent and prestigiousautomobile brand In an attempt to broaden its market share as an SUV manufacturer, BMWacquired the Rover Group in 1994 However, this endeavor proved financially unsuccessful,resulting in significant losses of approximately $4 billion Eventually, BMW sold the LandRover brand to Ford in 2000 Nonetheless, BMW experienced resounding success with therelaunch of the iconic British MINI in 2001 Additionally, the esteemed British brand Rolls-Royce became a part of BMW in 2003, further solidifying the company's presence in theluxury automotive sector It is noteworthy that members of the Quandt family haveconsistently maintained a significant ownership stake in BMW, demonstrating their ongoingcommitment to the company's success

3 Vision and Mission:

BMW has established itself as a leading brand known for its high-quality luxury vehicles,innovation, and cutting-edge technology The company recognized the changing needs of

customers and shifted its focus towards providing premium products and services forindividual mobility.

BMW's vision is to become the global leader in offering exceptional and sustainablesolutions that exceed customer expectations

The company's mission is to create and deliver remarkable mobility experiences that bringjoy, passion, and excitement to customers BMW is dedicated to crafting premium vehiclesthat embody outstanding quality, advanced technology, and dynamic performance

By continuously pushing the boundaries of automotive engineering and embracingsustainability, BMW aims to shape the future of mobility while ensuring long-term successand making positive contributions to society

By expanding internationally, BMW was able to exploit economies of scale, improve itssupply chain efficiency, and establish closer proximity to its target markets This strategicapproach also enabled BMW to reduce currency risks, conform to local regulations, andreact promptly to market demands

Moreover, BMW's internationalization efforts were accompanied by a keen understanding

of brand positioning and customization The company acknowledged the importance ofpreserving its reputation for luxury, performance, and engineering excellence across various

markets Therefore, BMW focused on offering localized product portfolios and marketingcampaigns adapted to specific regions, while still remaining faithful to its core brand values.The company's dedication to quality, innovation, and customer-centricity has earned it areputation as a reliable and desirable brand worldwide Today, BMW continues to extend itsglobal footprint and adjust to emerging markets, ensuring that it remains a prominent player

in the international automotive industry

In conclusion, BMW's journey from its origins as an aircraft engine manufacturer to its currentstatus as a global luxury automotive powerhouse is a testament to its unwaveringcommitment to innovation, quality, and performance The company's history is marked bypioneering engineering, timeless design, and a dedication to pushing boundaries With afocus on electric mobility, BMW is poised to shape the future of the automotive industry AsBMW continues to captivate drivers with its exceptional vehicles, it stands as a symbol ofexcellence and continues to inspire the automotive industry as a whole

Section 2: Analysis on international business strategies of BMW

I The value chain analysis

1 BMW’s Primary Activities:

a Inbound logistics:

BMW focuses on efficient procurement processes to ensure a reliable supply of quality materials and components The company collaborates closely with global suppliers,leveraging economies of scale and expertise in supply chain management Since thematerials that BMW needs have to be sourced from different countries, BMW has around13,000 suppliers located internationally

high-The company purchased most of its raw materials from its hometown, which isGermany, accounting for 33% of its purchase volume in 2022 This indicates a preferencefor local procurement, likely driven by proximity to trusted suppliers and the desire tosupport the local economy BMW also primarily conducts its manufacturing and assemblyoperations in

both Germany and Eastern Europe, leveraging the proximity to trusted suppliers Thisstrategic decision helps BMW optimize logistics costs and ensures a seamless supply chain.

Figure 5: The regional mix of BMW purchase volume 2022 (BMW Group Report 2022)

BMW operates multiple production facilities worldwide, and each facility may haveits own unique characteristics and supply chain arrangements The company incorporateslocal components and materials in its production, taking advantage of cost efficiencies andfostering strong relationships with local suppliers For example, BMW sources high-qualitybatteries for its electric vehicles from CATL (Contemporary Amperex Technology Co.Limited), a leading Chinese battery manufacturer; or with BMW in Mexico, the companyhas established partnerships with local suppliers to source components such as wiringharnesses, plastics, and other interior and exterior parts BMW's production facilities alsoadjust their inbound logistics processes based on regional market demands For example,BMW's production facility in Chennai, India, may have specific inbound logisticsarrangements to accommodate local regulations, such as customs procedures and taxrequirements

Conclusion:

Based on the above information, BMW is pursuing a combination of transnational businessstrategies, specifically a mix of global standardization and localization strategies BMW'sapproach of efficient procurement processes, collaboration with global suppliers, andleveraging economies of scale aligns with the global standardization aspect of atransnational strategy This allows BMW to ensure a reliable supply of high-qualitymaterials and components on a global scale At the same time, BMW's emphasis on localprocurement, incorporation of local components and materials in production, andpartnerships with local suppliers demonstrate the localization aspect of a transnationalstrategy BMW recognizes the importance of adapting to local market demands andregulations, such as customs procedures and tax requirements, which is evident in itsproduction facility in Chennai, India.

b Operations:

BMW Group is divided into the following four business segments:

- Automotive: €15.2 billion BMW's automotive segment profit margin increased to8.7% in 2022, up from 7.9% in 2021 The improvement in profitability was driven byhigher sales volumes, as well as improved pricing

- Motorcycle: €1.2 billion

(BMW sold a record 2.52 million vehicles in 2022, up 8% from 2021 The strongsales were driven by strong demand for BMW's electric vehicles, as well as its newX-series SUVs)

- Financial services: €7.8 billion BMW's financial services segment profit marginincreased to 7.1% in 2022, up from 6.7% in 2021 The improvement in profitabilitywas driven by higher sales volumes, as well as improved underwriting results

- Other entities: €1.1 billion

Even though BMW is headquartered in Munich, its operational stores are presentworldwide In total, there are 31 product-oriented service stores in 15 countries However,

its production span is scattered around the world in 140 countries Out of these 31, eight areunder

the control of partners and shareholders The remaining operate under the supervision ofBMW and its subsidiaries.

BMW strategically locates its production facilities in different regions to cater to specificmarket demands For instance, the company operates manufacturing plants in Germany forits European market, in the United States for the North American market, and in China forthe Asian market This regional production approach enables BMW to respond quickly tomarket needs, reduce transportation costs, and minimize trade barriers To demonstratefurther, BMW's production facilities in Germany serve as the company's headquarters andact as the main manufacturing hub for its European market These facilities produce a widerange of BMW models tailored to the preferences and requirements of European customers.For example, BMW's plant in Dingolfing, Germany, specializes in manufacturing luxuryvehicles like the 7 Series and 8 Series, which are in high demand among Europeancustomers In addition, BMW operates manufacturing plants in the United States to cater tothe North American market One notable facility is the Spartanburg plant in South Carolina,which is the company's largest global production site This plant produces BMW's popularX-series SUVs, including the X3, X4, X5, and X6, which are highly sought after by NorthAmerican customers By manufacturing these vehicles locally, BMW reduces transportationcosts, minimizes import duties, and responds more effectively to the preferences of theNorth American market

BMW's strategic approach of locating production facilities in different regions aligns withthe company's focus on key automobile and motorcycle markets worldwide In 2022, BMWGroup's largest automobile markets were Germany, France, and the United States, reflectingthe significance of these regions in terms of sales and demand for BMW vehicles The graphbelow highlights the prominence of these markets and emphasizes the strategic significance

of BMW's operations in these regions

Figure 6: BMW Group largest motorcycle markets in 2022 (BMW Group Report 2022)

Figure 7: BMW Group's largest automobile markets in 2022 (BMW Group Report 2022)

Conclusion:

BMW Group pursues a transnational business strategy through various keyelements Firstly, the company strategically locates its production facilities in differentregions, such as Germany, the United States, and China, to meet specific market demands

This regional production approach enables BMW to customize its products according tocustomer preferences, respond quickly to market needs, reduce transportation costs, andminimize trade barriers Additionally, BMW focuses on key automobile and motorcyclemarkets worldwide, particularly Germany, France, and the United States, aligning itsoperations with high-demand regions to capture market share and maintain a competitiveadvantage The company's profitable segments, including automotive and financial services,demonstrate successful utilization of its global operations to generate profits Withoperational stores and production facilities worldwide, BMW establishes a strong globalpresence, accessing diverse markets, leveraging local resources, and building strongcustomer relationships These factors collectively indicate BMW's adoption of atransnational strategy, allowing the company to effectively navigate international marketsand maximize its business performance.

c Outbound logistics:

BMW has a global distribution network of over 3,000 dealerships in 140 countries.The network is designed to provide customers with a convenient and seamless way topurchase, service, and maintain their BMW vehicles In the United States, BMW has over1,000 dealerships in all 50 states The company also has a number of regional distributioncenters that help to ensure that vehicles are delivered to dealerships quickly and efficiently

BMW manufactures vehicles at several production facilities around the world andtransports them to distribution centers using various transportation methods, includingtrucks, ships, and airplanes Then BMW will prepare the vehicles ready for sale at thedealership and agency networks Customers then will be offered a variety of financingoptions to help customers purchase their vehicles The map below shows an example ofBMW Group outbound logistics in the past