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BMW details cost cuts
By Yoann Besnard on 10 February 2008 | 
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BMW has unveiled the plan to cut costs by €6 billion by 2012. Two-thirds of the amount will achieved by slashing material costs.
Chief Executive Nobert Reithofer gave concrete details about the new strategy adopted by the car maker in last September. He announced that BMW will cut costs by slashing material costs. He also revealed that the personnel costs will drop by up to €500 million a year from next year. The company signed agreement with the union leaders which favors temporary staff and promote early retirement or buyout offers with filling the left vacancies.
The car maker confirmed that it plans to increase its profit margin from a current 6 percent to 8-10 percent by 2012. However the company also added that a weak dollar would make the goal harder to achieve.
BMW also expects to increase the part of shared components for its future models. Chief Financial Officer Michael Ganal said BMW was making "good headway" in talks with other carmakers.
