The BMW Group provided a first glimpse of its plans at its Capital Market Day 2026. The aim is to strengthen the company’s resilience and enhance the competitiveness of its structures. In this way, the BMW Group is preparing to face increasingly challenging market conditions in the years ahead.

To achieve this, the company is relying on its strategic strengths: technology openness, potential for technological innovation, a global presence, and a clear premium brand strategy.

Milan Nedeljković, Chairman of the Board of Management of BMW AG: “The BMW Group has always been at the forefront of the automotive industry – and that is where it belongs in the future as well. Under increasingly challenging conditions, we have defined measures to reposition ourselves and will implement them with strong momentum.”

“The BMW Group has the critical expertise to pursue this path successfully. The strengths of our corporate culture are also crucial to this: Courage and pragmatism will be just as important as having an entrepreneurial mindset and the determination to succeed,” he added.

Increase speed and efficiency

In recent months, the BMW Group has made far-reaching decisions and begun implementing initial measures to increase speed and efficiency across the company significantly. The company is currently evaluating many additional topics, with decisions expected by spring 2027.

Based on these measures, the company aims to return to its long-term target range of 8 to 10% for EBIT margin in the automotive segment by the start of the next decade. Free cash flow in the Automotive Segment should then increase to at least €7 billion. As an initial interim step in 2028, EBIT margin is expected to be in the range of 3 to 5%.

Walter Mertl, member of the Board of Management of BMW AG responsible for Finance: “The BMW Group remains committed to maintaining its consistent focus on value creation and sustainable profitability. At the same time, we will continue to ensure that our shareholders also share in the company’s long-term success.”

Product portfolio revised

As the first step in this process, the BMW Group will align its model line-up more systematically with diverse regional customer preferences. This includes targeted expansion and strengthening of the product range, as well as significant adjustments to its drivetrain portfolio, focusing on models that can deliver the greatest value for customers and the highest contribution margins over the long term in each market. At the high end of the portfolio, the BMW, BMW M and Rolls-Royce brands will be refined to leverage their respective strengths and unlock additional earnings potential.

In this context, the BMW Group will bring the first BMW Alpina model to market next year. Inspired by the BMW 7 Series, the company is strategically expanding its product range in the segment between BMW and Rolls-Royce with this new offering, tapping into additional potential at the top end of the market.

At the same time, the company will review and reduce the number of variants across the entire portfolio to optimize profitability. For example, there will be no successor to models such as the BMW 2 Series Active Tourer.

Also, the newly launched 3 Series will no longer be offered with a diesel engine in its eighth generation. CEO Nedeljković stressed, however, that this was not a fundamental decision against the combustion engine and that it could well be offered again on other models.

Regional accents

The portfolio streamlining will focus on China, where local production in high-volume segments will expand with the launch of the Neue Klasse. At the same time, imports will be limited to the highest-margin models.

Local development activities will also expand, and technological features will be designed to meet Chinese customers’ needs better. The aim is to increase the share of locally manufactured vehicles developed specifically to suit Chinese customer preferences to at least 95% by 2030.

Specifically for the highly successful SUV segment (stubbornly called SAV by BMW, for Sports Activity Vehicle) in the US, the BMW Group is considering introducing an additional offering above the current top-end model, the BMW X7, tailored to US market needs.

Demand for BMW’s globally highly successful premium SUVs is already so high that Plant Spartanburg, the ‘home of X’, is currently operating at full capacity. In this situation, the BMW Group is also striving for greater regionalization so it can expand global production of these models. This would enable the company to meet growing customer demand in all sales regions more comprehensively and more directly.

Regarding Europe, as we discussed a few days ago, the BMW Group will strengthen its presence in the high-volume entry segment with a compact fully electric model from the Neue Klasse.

New sales model in Europe in 2027

Following the successful go-live of the genuine agency model for Mini sales in 24 European markets, the rollout for the core BMW brand is scheduled to get underway in mid-2027. This gives the company a consistent Europe-wide data basis spanning the complete customer journey, from test drive to aftersales.

Here, artificial intelligence is not merely an additional tool. It is still the foundation of the entire sales system, enabling even more tailored solutions for every customer through both local retail partners and digital offerings.

Adjustments to personnel and management structures

Alongside adjustments to its model line-up and planned internal efficiency gains, the BMW Group is also increasingly examining its costs and operational processes.

BMW plans to simplify its structures and rely more heavily on AI to adapt more quickly to global market changes, with a 20% cut to the number of “divisions and associated management roles” by mid-2027.

The move initially affects relatively senior heads of division, although the effect will also be felt at lower management levels. However, the Munich-based automotive group said it is not linked to a large-scale headcount reduction.

Earlier this year, BMW announced a voluntary redundancy program across all areas except production. The total global workforce is to be reduced by around 8,000, according to company sources, with many jobs likely to be cut in administration and research and development in Germany.

CEO Milan Nedeljković said BMW’s organizational structure in Munich was “simply too large” and needed to become leaner and more agile. Production in Germany, by contrast, was well utilized and therefore excluded from the redundancy program.