Ladies and Gentlemen, It is a great pleasure to welcome you to the International Press Evening of the BMW Group and I thank you for accepting our invitation.

Business Year 2000

At our annual shareholders' meeting in May 2000, I said that we assume that the year 2000 will again be a record year for the BMW brand. We have kept our promise. A month ago, in our letter to our shareholders, we reported on the course of business in fiscal 2000, BMW's best year in our history to date.

In the year 2000, the BMW brand was able to boost its worldwide sales by more than 9 percent to 822,181 vehicles. This makes us stand out clearly from the general development of the international car market. 

Driven by this positive development of sales in fiscal 2000, BMW Group sales went up 2.8 percent, reaching a new record of 35.36 billion Euros.

With this sales increase of roughly 20 percent for the BMW brand, we were able to more than compensate for lost sales of Rover and Land Rover.

The positive development of sales of the BMW Group forms the basis for an outstanding financial result, for last year we even outperformed the result of our previous record year 1997. We shall also see a better return on sales than back in 1997.

We shall be communicating more details at our Annual Accounts Press Conference on 27 March.

Another achievement that exceeded all our expectations last year was our new entry into Formula 1. We are very satisfied with our third place in the constructors' world championship. It was the best new entry of an engine constructor in 33 years and we are set to defend this third place in the 2001 season. It is not least thanks to our all-new engine that we expect to be catching up with the two top teams.

Ladies and Gentlemen, our figures for the year 2000 impressively underscore the fact that the BMW Group is as successful as never before.

New Products in 2001

The cornerstones of this success are the strengths of our brands. For innovative products, unique product performance and creative penetration of a market segment are prominent features not only of the BMW brand but also of the BMW Group as a whole. You will be able to convince yourselves of this achievement here in Geneva. 

Overall, four new automobiles of the BMW Group are celebrating their world premiere in Geneva this year.

The new BMW 3 Series compact is at the center of our appearance at this year's motor show. It is the newest variant of what is the most successful 3 Series of all times and a further representative of our successful concept of variants which has meanwhile been adopted by our competitors.

The 3 Series compact has so far been our model with the highest conquest rate relative to the competition. The concept has created its own class in the market and has proved its value in an extraordinary way with 400,000 cars sold. The 3 Series compact of the first generation has thus established the premium in an automobile category where premium did not exist before.

With the new 3 Series compact, which has an entirely unique and distinctive appearance within the 3 Series, we shall continue our story of success. The body, which has been shortened against the 3 Series saloon, the distinctive, sporting suspension tuning, the high-quality equipment as well as the variable interior constitute a particularly successful combination of sportiness and fitness for everyday road use.

The price of the new 3 Series compact in Germany will be DM 39,900 for the 316 ti and DM 56,100 for the 325ti. We shall announce the prices for the other markets in good time.

The new BMW four-cylinder petrol engine of the 3 Series compact marks the go-ahead for the market launch of a new engine generation with VALVETRONIC. VALVETRONIC replaces the classic function of the butterfly valve, which amounts to a genuine revolution in the construction of the combustion engine. 
The engine comes from our new engine plant in Hams Hall, Great Britain, which was opened only a few days ago.

The new 3 Series compact with VALVETRONIC offers the customer what is by far the lowest fuel consumption in its class. Compared to the competitors in its segment with a spark-ignition engine, the fuel consumption of the 3-Series compact is far more than 1 litre per 100 km lower and thus more efficient. In addition, the new 4-cylinder engine concept meets EU 4, the most stringent European emission standard.

Incidentally, with its VALVETRONIC power unit, the BMW Group once again underlines its leadership in technology and its claim to build the most efficient engines in comparison with its competitors.

We want as many BMW customers as possible to benefit from the consumption, emission and performance advantages of VALVETRONIC technology as soon as possible. VALVETRONIC will therefore also be introduced successively in other BMW engines.

Ladies and Gentlemen, in addition to the new 3 Series compact, the world premieres of the BMW Group at the Geneva Motor Show also include the new BMW X5 3.0 d with an in-line six-cylinder diesel engine as well as the BMW M3 with the new Sequential M Gearbox.

The BMW X5 3.0 d now combines the broad spectrum of our Sports Activity Vehicle with powerful diesel economy units.

Our new Sequential M Gearbox in the BMW M3 is an example of how know-how and experience gained in our motor sport activities are incorporated into our production cars as innovative features.  The BMW M3 launched in 1996 was incidentally the first model offered in the entire market with a sequential gearbox.

Moreover, with the BMW X5 4.6is and the new BMW M3 convertible, we are for the first time presenting real high-performance cars here in Europe, which will set their own standards in their respective market segments.

Also experiencing a European premiere are the BMW M Coupé and the BMW M roadster featuring the same 6-cylinder high-performance power pack that you are already familiar with in the recently launched BMW M3.

Above and beyond that, it gives me great pleasure to be able to present - for the first time here in Geneva - the entry-level model of the MINI product family, the MINI ONE.

The MINI brand embodies a modern urban lifestyle beyond any short-lived trends. It is the epitome of the inspiring, young, classless sub-compact, which enjoys undivided popularity worldwide.

With the MINI brand and the MINI ONE, the MINI COOPER and, a little later, the MINI COOPER S, we shall be creating a premium dimension in the sub-compact car segment and will enhance the profitable growth of the BMW Group.

Ladies and Gentlemen, a further example of our constant product offensive will be this year's new BMW 7 Series, which will be presented at the Frankfurt Motor Show. The new 7 Series is an entirely newly developed car. Apart from its abundance of technical innovations, it will also boast brand-new exterior and interior design and thus represent a pioneering design philosophy. Its pace-setting operating concept "iDrive" constitutes a revolution in automotive engineering. Above all, the new 7 Series will again be a driver's car, a typical feature of BMW automobiles. And with this special characteristic, it will move up yet another gear compared to its already superb predecessor.

With this new top-of-the line model, the BMW Group once again underscores its outstanding leadership in technology. 

In the motorcycle sector, BMW will shortly come to the market with two new models, the R 1150 R and the R 1150 RT, as well as the R 1200 RS, a revised version of an existing model. Furthermore, with our new BMW Integral ABS, we shall also be introducing yet another true innovation.

With the BMW C1, an entirely new vehicle concept, the C1 200 will offer more power and performance.

This product offensive we continue with determination. Last year, we already announced a new small BMW. This new model series will be a consistent enhancement of the BMW compact philosophy.

The new small BMW model series will tie in with the BMW nomenclature and will therefore receive the number "1" in BMW's overall product range. You will therefore in future be able to speak of the BMW 1 Series. With the BMW 1 Series, the entry level for the BMW brand is clearly defined.

Let me also announce a further new feature of the next few years. We have decided to develop a large coupe that will be linking up with the tradition of earlier upmarket BMW coupes. 

Again, I am pleased to announce the name today. The new large BMW coupe will be called the 6 Series.

The BMW 6 Series will have a high prestige value on the one hand and embody typical BMW sportiness on the other. This vehicle is also slated to be offered as a convertible version.

Corporate Strategy Considerations

Ladies and Gentlemen, our new products help us to create the conditions for continued profitable growth. The success of the BMW Group is a consequence of our strategic orientation.

The BMW Group today is the car manufacturer that follows a clear-cut, success-oriented course with a logical and sensible premium-brand strategy. A strategy that takes into account all identifiable trends, growth potentials and customer demand patterns.

The BMW Group focuses on those segments of the global car market which

• show an above-average growth potential
• fit in with the character of the respective brand and
• allow the Group to generate profits at levels that meet our corporate targets.

With BMW, MINI and, from the year 2003, Rolls-Royce, the BMW Group covers selected premium sectors of the segments ranging from sub-compacts to the absolute luxury class. Volume as an end in itself is not the objective.

Rather, what we want is profitable growth, with "profitable" coming first and "growth" following second. Because what matters is the gross profits we shall see at the end of the day - and how much of those profits we shall be able and wish to invest in our future. Therefore, what matters is strength, rather than sheer size.

Let me say at this point that we shall continue to make above-average investments in our future and finance those investments out of our cash flow.

With our planned new BMW models as well as our established high-yield model series, we are growing around our core product portfolio. This will enlarge our sales and gross profit volume in a controlled and sensible manner.

In a logical and consistent pursuit of our strategy, we shall continue to focus on the intensive further development of our worldwide sales and production network.

Economic growth on the international markets is the key pillar of our strategy for profitable growth. 

With our global network of currently 27 subsidiaries and 15 production plants for automobiles or CKD production, we are well prepared for further growth in the key regions of all five continents.

This year, we are continuing our efforts to open up the Asian markets of the future. Thus, we established new sales subsidiaries in Indonesia and on the Philippines as early as late January this year; they will start their sales activities in April. In this way, we are strengthening our commitment in two of the most promising Asian national economies with promising long-term growth perspectives.

In China, we are in the process of working with Brilliance Automotive Holdings, Shanghai, to conduct a feasibility study for an assembly plant. This study will be submitted to the Chinese authorities for approval.

Outlook for 2001

Ladies and Gentlemen, the year 2001 has been off to a good start for the BMW Group. Compared to the same period last year, the BMW brand, by initial estimates, will be able to increase its car deliveries by approximately 10 percent in the course of the first two months.

With our cars, we expect continuously growing sales figures also in future. In our motorcycle division we are also staying on course with a level of growth undiminished for the past eight years.

The BMW Group is systematically and efficiently pursuing profitable growth in the growth markets and growth segments relevant to our brands. With our new premium cars, we shall continue our successful development in regard to sales, turnover and profits.

Therefore let me say that we are not only pleased with the successes we achieved last year, but also have every reason to look forward to the year just started. We look forward to the future with confidence and justified optimism.

I thank you for your attention and now wish you pleasant and interesting hours at this International Press Evening of the BMW Group. As you know, the motto for this evening is "Fresh up your mind"! And with that let the curtain rise for the new BMW 3 Series compact!