BMW Trims Management Ranks by 20% in Broad Margin Turnaround Push

BMW Group has laid out a sweeping restructuring aimed at rebuilding profitability, with plans to reduce its divisions and management positions by a fifth before the middle of 2027. The strategy, presented during the company’s Capital Market Day, targets a return to an 8–10% automotive EBIT margin in the early 2030s, with an interim goal of 3–5% set for 2028 and automotive free cash flow of at least €7bn (US$8.2bn).

The automaker is reshaping its product portfolio around higher-margin offerings. The 2 Series Active Tourer will be phased out without a successor, and trim levels across the range will be pared back. A first Alpina-badged BMW based on the 7 Series is slated for 2027, while the company is also evaluating a US-built sport activity vehicle positioned above the X7 — a move complicated by Spartanburg already running at full capacity.

In China, BMW will expand local Neue Klasse production while scaling back imports to only its most profitable models. At least 95% of vehicles built in China will be tailored to local buyers by 2030, and exports from China to Southeast Asia are under review. A compact electric Neue Klasse model is set to arrive in Europe in 2028.

BMW is also betting on agentic AI to speed up decision-making, deploying it in core development areas including crash simulation work with Mistral AI. The BMW brand will shift to an agency sales model in Europe starting mid-2027. Chairman Milan Nedeljković framed the restructuring as essential to staying competitive: the workforce programme is a key lever, he said, as the company works to sharpen its structures and cost base against intensifying industry competition.