Luxury carmaker Bayerische Motoren Werke AG (BMW) is targeting €6 billion
($8.5 billion) in expenditure cuts by 2012 to increase profitability and compete
with DaimlerChrysler AG''s Mercedes Car Group.
automotive division has set a goal of achieving a 26 per cent return on capital
employed by 2012.
BMW plans to reduce costs across its three brands, boost
productivity by 5 per cent annually even as chief financial officer Stefan Krause
and sales chief Michael Ganal swap positions. The carmaker also plans to increase
its dividend "substantially."
net income fell 4.3 per cent to €753 million in the second quarter as earnings
at Stuttgart, Germany-based Mercedes almost doubled to 1.2 billion euros.