BMW SWOT analysis – SWOT analysis of BMW

January 25, 2020 By Hitesh Bhasin Tagged With: SWOT

One of the most classy cars across the world, known for its quality and design is BMW. The brand is known to be adaptable and has cars which are in the ultra premium segment as well as cars which are pretty much affordable as far as luxury cars go. Here is the SWOT analysis of BMW.

Table of Contents

Strengths in the SWOT analysis of BMW

1. BMW group: Group consist of 3 brands namely BMW, MINI &Rolls Royce all positioned in the premium segment. Also BMW is not only a car maker, they are one of the world leaders in motorcycle production, aircraft engines and marine engines.
2. Innovation & technological advancement: Continuous process improvement & technological advancement in its R&D has made it a market leader in the premium segment for car sales. The Brand is known for its quality, reliability & superior customer service support. And more importantly for the lovely design of its range of cars.
3. Renowned brand in automobile industry: With its innovative advertising campaigns company has succeeded in positioning it as a premium brand resulting into High TOMA (Top of mind awareness).
4. Workforce: It has created a pool of 100000+ highly skilled employees who continuously work in 100+ countries to differentiate BMW’s offering from their rivals.
5. Product portfolio: BMW have diversified product portfolio from SUV’s to Luxury Sedans to sports cars. The product line and product depth are fantastic in terms of quality and design.
6. Asian markets: There is very little to work upon in matured and developed economies. BMW has made the smart move by starting early in developing economies. And it is now the top selling luxury car in developing economies like India and China (in terms of total number of vehicles sold in a year).
7. Plans for hybrid models: BMW has plans to launch models which run on alternative fuels like Electricity and natural gas. These plans show that the company is making inroads to be prepared in the future where fuel might become a problem.

Weaknesses in the SWOT analysis of BMW

1. Cars recalled: Controversies relating to recall of cars on account of some technical functionality or non abidance to govt. led rules is becoming very common, most recent one is BMW recalling 1.6 million cars due to airbag concerns. For a brand like BMW it is affecting its brand image.
2. Strategic alliances: BMW group has very few strategic alliances. This gives the competitors an edge over BMW. BMW is capable of good R&D but the implementation of the researched vehicles takes strategic alliance with different companies which BMW lacks.
3. Younger generation less brand conscious – The younger generation is more likely to spend the money on electronic appliances then saving it for a premium car.

Opportunities in the SWOT analysis of BMW

1. Increasing product portfolio: By increasing their product portfolio and introducing new series in different segments they can increase their sales as there will be more choices for customers under the same brand. Off course, this is the best opportunity for any brand in the market.
2. Strategic Alliances: This can prove a smart strategy for BMW. BMW can use other company’s specialized capabilities to differentiate their offerings.
3. Changing lifestyle & customer groups: With changing customer lifestyle and more & more inclination towards premium brands it is certain that this segment is growing fast. In developing nations the growth rate is even as high as 33% YoY.
4. Market expansion: Entering new markets will help the company to increase their targeted revenue. This is the only way to ensure that they remain on top of the revenue chain for developing economies.

Threats in the SWOT analysis of BMW

1. Competition: Low cost car companies with their stylish & inexpensive offerings will be major threat to the company. Also Stiff competition from other companies in premium segment like Audi, Mercedes is a determining factor.
2. Price factor: More and more people are becoming price conscious and with the younger generation on an electronic purchasing spree, there is threat that in the near future luxury cars will stop receiving as much attention.
3. Rising fuel problems – BMW needs to strongly adapt to the need of green fuel and green machines so that it can absorb the potential customers who are looking for green car solutions, especially in the mature markets.