BMW says it is open to acquisitions, has examined buying another brand.

MUNICH (Thomson Financial) – Bayerische Motoren Werke AG said it is open to acquisitions and that it has examined the possibility of acquiring a car brand from its rivals, but none currently meet its acquisition criteria.

But BMW chief executive Norbert Reithofer said ‘acquisitions in principle remain on our agenda’.

‘For possible acquisitions in the future, we have clearly defined criteria in the strategy process. That way, we can act swiftly when needed,’ he said.

These criteria include creating scale effects, which means lowering the overall costs by producing more units, as well as contributing the same positive profits generated by the existing car business, he said.

Reithofer spoke at the start of a news conference, which was convened as the company disclosed details of a long-term strategy aimed at boosting profitability.

Reithofer also said BMW will increase its production capacity in its sole US manufacturing facility in Spartanburg to 240,000 units annually.

The capacity of the Mini plant in Oxford, UK will be raised to 260,000 units, while in China, as a first step, the output capacity will be raised from the current 30,000 to 44,000 units, he said.

Reithofer also said that the Mini brand will have an SUV model and confirmed it would make the BMW X1.

It will also build a four-door Gran Turismo based on the concept car presented in Shanghai recently, it said.

At the question and answer session, Reithofer said ‘acquisitions are not on the agenda in the next 12 months’ because the company wants to concentrate on the projects it has identified under its strategy review.

He also said the company is considering producing ‘strategic components’ and is examining the possibility of producing and selling powertrain as a new business area.

He said the company would consider reviving its business in producing and selling engines.

Reithofer also said BMW building a multi-purpose vehicle does not fit with the company’s business model.

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Source: Forbes.com