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BMW faces fresh challenge as CEO Harald Krueger steps down

BMW Friday announced the retirement of chief executive officer Harald Krueger amid speculations about his future in the company after the current term ends. Krueger’s decision to step down comes at a time when the German carmaker is on a mission to transform the business model, with focus on alternative fuel technology. The automotive division […]

July 5, 2019 3 min read
Market News

BMW Friday announced the retirement of chief executive officer Harald Krueger amid speculations about his future in the company after the current term ends. Krueger’s decision to step down comes at a time when the German carmaker is on a mission to transform the business model, with focus on alternative fuel technology. The automotive division […]

· July 5, 2019

BMW Friday announced the retirement of chief executive officer Harald Krueger amid speculations about his future in the company after the current term ends. Krueger’s decision to step down comes at a time when the German carmaker is on a mission to transform the business model, with focus on alternative fuel technology.

The automotive division of BMW, which is going through one of the worst phases, recorded a loss in the most recent quarter. Only the motorcycle and financial services segments were profitable. In the current scenario, Krueger’s retirement is likely to add to the company’s troubles. It will be a challenging task for the management to find a fitting successor to Krueger, considering the changing market dynamics marked by the growing shift to electric vehicles.

The board of directors of BMW is expected to devise the succession plan at the meeting to be held later this month. The board was planning to seek the renewal of Krueger’s contract at the upcoming meeting. After serving the company for about three decades, holding the post of chief executive in the last four years, Krueger will be stepping down next year.

The board of directors of BMW is expected device the succession plan at the meeting to be held later this month

Krueger, who expressed his unwillingness to seek another term, will continue in the current position until a successor is found. Earlier, he had come under fire for the company’s dismal earnings performance in the recent quarters, the weakest in several years. Making matters worse, the carmaker was recently hit by a penalty of about EUR 1.4 billion in an anti-trust lawsuit.

As the industry is undergoing a rapid transformation, it is essential for automakers around the world to keep pace with the new trend and BMW is no exception. It is expected that the company’s growth initiatives, with long-term goals, will take some time to yield the desired results.

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Also see: General Motors Q1 2019 Earnings Call Transcript

In a sign that the company is taking the threat from electric vehicles seriously, BMW last month unveiled the Vision M Next electric car and electric motorcycle concepts. It is believed to be a strategy to effectively compete with Volkswagen, which is aggressively pushing its EV initiative, and Tesla (TSLA).

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