BMW boss admits company faces worst crisis in firm's history
28 November 2008

Car makers that had seemed in a strong position to weather the global economic storm have publicly admitted a 'crisis' as sales continue to slow down.

BMW's boss Norbert Reithofer yesterday described the situation to Germany's Spiegel magazine as "the worst crisis BMW has faced in its history".

Despite the slow sales, it is the German giant's reliance on leasing that has put it in a very vulnerable position.

Meanwhile Daimler boss Deiter Zetsche assessed the current conditions as "the worst crisis since World War II".

Martin Winterkorn, boss of Volkswagen, told reporters: "We have never before seen this kind of crisis" adding that "difficult cuts" maybe unavoidable.

But it's not just the German's who are talking openly about serious problems.

Previously stable Japanese giant manufacturers like Honda and Toyota are also publicly airing grave concerns.

Toyota's vice president Mitsuo Kinoshita described the situations as "an emergency of a magnitude we have never seen before".

Honda has also admitted that it will be "very difficult" to meets its full-year profit forecast and is scaling back production by some 40,000 units in Japan.

Industry experts say the most flexible car makers, which can adjust quickly to falling demand, will be best placed in the months to come.

Will Powell

Join the debate

Comments
58

28 November 2008

Maybe the problem is that people now are starting to look at a car as transport.

28 November 2008

They(BMW) got suckered in by the whole false prosperity boom of the United States in the last decade. The tech stock/dotcom boom of the late 90s and then the housing speculation boom of 2003-7 generated a mountain of credit for financing car deals. Mortgage equity withdrawal, in addtion to car-makers' finance packages and leasing deals, convinced many Americans that they were truly rich and should live accordingly, like the celebs. With the collapse of house prices everything else requiring credit is shafted, same story in UK. BMW rode this boom as good as anyone and is now as badly affected as anyone.

28 November 2008

At the end of the day all motor manufacturers are going to be suffering. The car is often the second largest purchase a person makes after their house. Modern day living means most people finance their cars and with the current global credit crunch, people are just not buying - any make.

 

 

It's all about the twisties........

28 November 2008

Surely any person with any economic sense and reasoning would have been looking at the global economy for a very long time and have said to themselves “this can’t go on” !

The borrow, borrow attitude of most people in the western world has sucked in most of the other economies throughout the world and they are now all living to regret it.

The car manufacturers and by that I mean the very vast majority of global and niche car manufacturers are all producing the wrong kinds of car.

People have been harping on for oh so very long about fuel economy, people have been going on about affordability, people have been going on about practicality and yet what have BMW and all the other major brands been producing………….. stuff that marketing departments love to market and to hell with what the world really needs.

Good luck and good riddance to any manufacturer who will not listen….. and just to think I was once a very high powered petrol head but such is life !

Loving life in France with my Springers

28 November 2008

[quote dillonsamben]

People have been harping on for oh so very long about fuel economy, people have been going on about affordability, people have been going on about practicality and yet what have BMW and all the other major brands been producing………….. stuff that marketing departments love to market and to hell with what the world really needs.

[/quote]

Actually, that's crap. Uninformed crap. BMWs are the most fuel efficient and climate friendly (in CO2 terms if you think that's important) in their class. Please spare us your green agenda cos it's not working any more. It's true though, you're no petrolhead.

28 November 2008

Steve you are mistaken, the BMW is fuel efificient if you leave the "start/stop" option on, but many people turn it off (as I have been told) and thus you find that the figures quoted are not actual; as a note, I understand that on the BMW when the engine turns off (eco mode on) then the air conditioning goes off also!.......hence the reason why many folks I guess (from what I understand) actually turn off the the "start/stop" mode.

Also I did not take what he said as being "green agenda", BMW should have changed many years ago, but it did not, if you state that 5 litre cars are needed?.......by who, who really needs a 5 litre car, truly needs it? its a nice thing to have if you can afford it, but it is not essential.

Anyway, I like cars as much as the next person, but BMW have the strategy wrong, it was debt fueled purchasing, if it was not debt fueled why have the mini sales tanked; the mini originally (the first mini from years ago) was like the peoples car, that is why it was what it was, but BMW turned it into (and I have checked this) a car costing over £25K with all the options?....what's that about, sure when people can afford two cars, but when a Mondeo can be had for approx. half the price with lots of space for the family, now the market is showing cars values; the market will decide.

The market is moving towards smaller engined more efficient cars; as a note, if the BMW 1 is in the same bracket as the Ford Focus, I think (without checking) the eco-tec (or whatever it is called) is more efficient and less polluting than the BMW.

I also see that Mercedes produce total life costs and factor green issues into this (well done Mercedes!) and this is why the C Class has steel instead of AL. in some aspects i.e. the environmental cost in terms of "life cycle" was less for steel then AL. even though the car was a little heavier; well done Merc! I have just had a look at the BMW site and they do not seem to do the same....also on the BMW site they have a comparison chart and the Focus Ecotec beats the BMW by a mile i.e. over 600 on g/km per annum; maybe you do not consider the other guy to be a petrol head, but maybe you are too much of a hot head and should research more!

Fact is BMW are going to struggle, the US is shuting down on them, as is the Asian markets; time will tell, but BMW (I think) are in far a rough ride indeed.

28 November 2008

North, old fruit, thanks for calling me a name. No need for that !

There are a couple of things I'd like to pick you up on. No one needs 5 litre cars ?!?! No one needs tea either. Nor hair gel. Nor chocolate. See ?

BMW is to be blamed for people electing to turn stop/start systems off ? Don't be silly. The 118d does 119 CO2s which is, as I understand it, in one of the lowest tax bands. You can hardly accuse BMW of not listening to customers and producing something that helps them lower the amount of tax they pay and the amount of CO2 that is emitted ? That would be churlish.

As for Minis, it doesn't matter what they charge. You can see for yourself that they are very popular indeed so it can't be too much. You will note from today's Autocar news on this very website that the new convertible is two tax bands less than the old model. BMW listens again.

I had a quick squiz at the base models of Focus and 1 series on both their websites. Focus has a high CO2 of 189 and a low of 114. The 1 series comes in at 119 and 152 (excluding the 130i which, of course, no one really needs !). Practically no difference as if CO2 was important to the climate anyway.

With respect to strategy based on leases, you'll find that all manufacturers have been affected by this if they have even the slightest exposure to the US. You seem a little bit confused : on the one hand the Mondeo is the best car since sliced bread was invented and on the other Ford is about to run out of cash because of its exposure to US leasing. You can't have it both ways.

Last point : I like your research but you should analyse the results better before you reach a conclusion.

28 November 2008

I agree with Steele.

See, we can post about cars too. We are multi skilled.

I'm off to gaze at my navel for abit.

28 November 2008

[quote Scummyplumster]See, we can post about cars too.[/quote]

I can't actually. I get all my quotes from other forums.

28 November 2008

Cars are no fun anymore. Why because there fat, have big fat wheels and tires, and tons of rubber insulating the heck out the entire exerience.

The BMW 1-series is truly nothing special and super ugly with it. Quite frankly a mk1 Focus is the better drive. Not to mention the original M3.

Cars have become big bloated,ugly and fat just like the CEO's that design them!!


Pages

Add your comment

Log in or register to post comments

Find an Autocar car review

Driven this week

  • Skoda-Karoq 2.0 TDI 4x4
    First Drive
    16 October 2017
    Diesel version of Skoda’s junior SUV is unobtrusive and undemanding, but we’d still go for the silkier petrol version of the Karoq
  • Audi Q7 e-tron
    First Drive
    16 October 2017
    Expensive and flawed but this understated diesel-electric Audi Q7 has a lot to offer
  • Citroën C3
    First Drive
    16 October 2017
    Is the third gen Citroën C3 ‘fresh and different’ enough to take on its supermini rivals? We spend six months with one to find out
  • BMW X3
    First Drive
    15 October 2017
    A satisfying rework of the X3 that usefully improves its handling, cabin finish, space and connectivity to make this BMW a class front-runner again
  • Vauxhall Insignia Country Tourer
    First Drive
    13 October 2017
    Off-road estate is now bigger, more spacious and available with torque-vectoring all-wheel drive, but is it enough to make its German rivals anxious?