Although the consolidated numbers make the case appealing, personally, I have heard from sources that the company is fairly over staffed, with a lack of any clear and consistent KPIs. Each employee gets a pretty attractive compensation package, and I think this will continue applying margin pressure. So I’m not sure how they will compete with existing Chinese brands, and given that Xiaomi is going international next year.
I know BMW has a special brand, but that doesn’t mean that the stock cannot get punished.
We think over the mid term bmw has to follow eventually the trend of downsizing not only the workforce (especially middle Management) and their physical dealerships since that model is not working that great anymore. Margin pressure is definitely there but the safety net from down here is pretty solid.
BMW doesn’t need to be perfect here.
It just needs the outcome to be better than what the current price already implies.
That’s the whole game.
Although the consolidated numbers make the case appealing, personally, I have heard from sources that the company is fairly over staffed, with a lack of any clear and consistent KPIs. Each employee gets a pretty attractive compensation package, and I think this will continue applying margin pressure. So I’m not sure how they will compete with existing Chinese brands, and given that Xiaomi is going international next year.
I know BMW has a special brand, but that doesn’t mean that the stock cannot get punished.
Great comment.
We think over the mid term bmw has to follow eventually the trend of downsizing not only the workforce (especially middle Management) and their physical dealerships since that model is not working that great anymore. Margin pressure is definitely there but the safety net from down here is pretty solid.