BMW ready for slower growth in China market, CEO states

Gasgoo.com (Shanghai November 7) - BMW is well-prepared for slowing sales growth rates in the Chinese automobile market, BMW AG CEO and Board Chairman Norbert Reithofer (pictured) stated, yicai.com reported today. According to Dr. Reithofer, although Chinese market growth this year is estimated to exceed ten percent, the rapid growth rates from the previous years will not reoccur. As growth in the Chinese market begins to normalize, it will soon start to resemble the US market, Dr. Reithofer explained.

Karsten Engel, President and CEO of BMW's Greater China operations, has previously touched upon this point many times. Mr. Engel explained that during the period of over 40 percent sales growth in China, the manufacturer did its best to develop its sales channels to keep up with explosive customer demand. However, he made sure to point out that sales growth rates would come down in the future.

On that topic, many BMW dealerships stated that the manufacturer is on the verge of shifting the focus of its strategy from exclusively targeting market share to maintaining its current sales volumes. Dealerships hope that the new policies will help them ensure their profits.

There are currently over 520 BMW dealerships (including 87 Mini brand dealerships) operating in China. When sales growth was extremely high, BMW was able to easily expand its sales network. However, as sales growth rates normalize, dealership are finding it increasingly difficult to stay profitable.

Mr. Engel previously stated that BMW will focus more on after sales services, the used car market and financing businesses. This will prove challenging as China's market for secondhand automobiles is still relatively underdeveloped and the scope of automobile financing operations very limited.