The world is changing greatly and rapidly in the recent several decades. All countries are connected together more closely with well-developed technology and changes in political environment. Lechner(2009) defined globalization as the process in which more and more people become connected in more deferent ways across larger distances. And also, Lechner (2009) suggests that, the international corporation is the principal part of globalization, which means international business is the most important way of people are connected from different countries. There are many factors affect an international business, such as Political-Legal, Economic, Technological and cultural (Aswathappa, 2010), and these are called international business environment, which is regarded as the external forces working upon the firm doing business both in foreign and domestic markets. BMW (Bavarian Motor Works) is one of the biggest international companies. It is doing international business in almost every country. It is a good way for us to understand how the international business environment affects an international business by study BMW’s international business.
The purpose of this report is to analysis the growth and performance of BMW Company in the last ten years, to find out what are the most important key factors within the international business environment have impacted on BMW. And also an estimate of its performance due to these factors will be given as well.
The Background of BMW
BMW (Bavarian Motor Works) is one of the most popular automobile manufacturers. In 1913, Karl Friedrich Rapp built Ropp-Motorenwerke, which is the original BMW factory, in Munich. In 1917, the company changed its name to Bayerische Motoren Werke GmbH (BMW). During the World War I, BMW produced aircraft engine for armies. After that, in 1918, BMW turned to be a public company and named BMW AG. In 1922, BMW merged Bayerische Flugzeugwerke (BFW), which is built by Gustav Otto in 1913 near PaPP’s factury, until then, that BMW is the one we know today. Before 1923, it was an aircraft engine manufacturer. BMW produced its first motorcycle in 1923, and only 5 years later they produced their first automobile DA2. After that, BMW produces lots of famous cars, such as AM4, 303, 7er-Reihe. Today, BMW is a big international company, which sells its products all over the world, almost every country. BMW produces one of the best motor engines and practice a successful global strategy on not only the brand positioning but also the management of international business. (BMW, 2013)
GROWTH AND PERFORMANCE OF BMW
Before the important factors impact its international business are discussed, the growth and performance of BMW in the last ten years should be reviewed. By the published BMW Group Annual Report 2007 and BMW Group Annual Report 2011,it is easy to see that the sales and revenue during last ten years are growing steadily (figure 1, figure 2).
Total 1104.9 1208.8 1328.0 1374.0 1500.7
Figure1 (BMW, 2007)
Figure 2 (BMW, 2011)
As these two figures said, BMW’s total sales from 2003 to 2011 are growing from 1104.9 units to 1669.0 units. But it is obvious that not all these years have a growth. The total sale in 2008 and 2009 are respective 1453.9 and 1286.3, which droped from 1500.7 units in 2007.
In some particular area, take Asia for example, there was no fail during the whole period. And also, the growth is increasing as well. It was a very slow growth and the beginning, but after 2005, there was an at least 7000 units increase in growth. Especially In 2010 and 2011, there were rapid increases in the sales growth, which are 103,200 and 89,200 units. And also it is easy to find that, the sales in Germany were very steady, they did not change much in these years, which were around 280,000 units per year.
As we know, after 2007, the world economic crisis came lead to more automaton producers are difficult