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Speaker 1: Yes, Sebastian maxisine here with me in the studio. Let's

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Speaker 1: talk about electric demand. BMW was really a pioneer in

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Speaker 1: the electric space with the I three and the I

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Speaker 1: eight years ago, and now you've just released the I five.

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Speaker 2: I was lucky enough.

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Speaker 1: To spend some time in the I seven, so you've

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Speaker 1: got a huge palette of offerings. How's the demand look

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Speaker 1: to you?

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Speaker 2: First of all, thanks for having me, Matt. The demand

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Speaker 2: is looking very strong. This is a process, I would

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Speaker 2: say where we are in and that's not a process

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Speaker 2: from twenty two to twenty three or from twenty three

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Speaker 2: to twenty four. This is a longer term transition and

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Speaker 2: we are very happy with the place we are. We

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Speaker 2: now have four different vehicles which we offer in the marketplace,

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Speaker 2: I four, I five, and I seven, so all the

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Speaker 2: main segments, and we see growth in those segments and

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Speaker 2: we think we have a strong product offer which customers appreciate.

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Speaker 1: One of the interesting things I saw is that you

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Speaker 1: had a jump in sales for sedans and a drop

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Speaker 1: in sales SUVs, and for most carmakers, I would think

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Speaker 1: that's very strange. But your electric offering is for the

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Speaker 1: most part with the accepting the I X right is

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Speaker 1: in the sedan space. Is that part of the reason

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Speaker 1: that you're selling more, you know, cars than trucks.

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Speaker 2: That is part of which is fueling this this trend. Also,

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Speaker 2: our trucks are very sought after from global markets, so

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Speaker 2: we always have to be a bit in a battle

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Speaker 2: with other markets where the vehicles go. The I four

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Speaker 2: has been very strong this year for the full year

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Speaker 2: available and that definitely also builds on the on the

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Speaker 2: demand on the siddan side, But the suv segment or

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Speaker 2: in our case sports activity vehicles SAV stays very strong

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Speaker 2: this year as well. X three, X five and X

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Speaker 2: seven mainly, and you.

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Speaker 1: Produce all those mainly all those here in Spartanburg. Is

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Speaker 1: there any plan to move some of that production back

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Speaker 1: to Germany? I saw recently the Mercedes, for example, is

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Speaker 1: moving production of the EQUS back back to Germany, and

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Speaker 1: I thought maybe you could do the same with the

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Speaker 1: X seven and backfill it with X five demand.

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Speaker 2: There's no plan to do that. Spartanburg is our main

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Speaker 2: stake here is over half of our business for the

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Speaker 2: US market, which we produce in South Carolina, and we

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Speaker 2: will rather invest further for future generations of those vehicles,

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Speaker 2: So no plan to relocate those production cars.

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Speaker 1: Yeah. I mean a lot of people don't know, but

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Speaker 1: you are the biggest export or automotive exporter in the country.

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Speaker 1: Nobody exports more auto product than BMW. You're going to

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Speaker 1: be building a lot more electric vehicles here, at least

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Speaker 1: that's what you've said previously. Do you still plan to

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Speaker 1: make six electric Folly electric vehicles in the US by

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Speaker 1: the end of the decade.

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Speaker 2: Absolutely. We have done this investment decision about a year ago,

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Speaker 2: when we announced it in November of twenty twenty two

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Speaker 2: in Spartanburg, and that is the plan. It's a well

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Speaker 2: analyzed and thought out plan, and this is where we

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Speaker 2: want to stick to and we will stick to. And suddenly,

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Speaker 2: currently sorry, the working is happening on the grounds where

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Speaker 2: additional facilities are being put up and we will obviously

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Speaker 2: use them. Now there's one interesting additional point to this.

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Speaker 2: We have a very flexible production structure, so we build

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Speaker 2: electric vehicles and non electric variants of the same vehicle

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Speaker 2: on the same line. So this is where we think,

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Speaker 2: with the approach to open technologies, have a good flexibility

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Speaker 2: in the system.

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Speaker 1: I'm just trying to engauge your commitment to electric vehicles

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Speaker 1: since there's been so much talk about you know, maybe

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Speaker 1: demand isn't quite as strong as people had expected. A

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Speaker 1: lot of automakers are pulling back on their investment plans.

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Speaker 1: What does it look like at BMW?

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Speaker 2: I think we have to be careful how we interpret

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Speaker 2: that information. One thing is is there a growing market

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Speaker 2: for electric vehicles one hundred percent? Yes? Is the growth

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Speaker 2: on the exact same level as maybe some experts have

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Speaker 2: estimated a year ago or six months ago. Maybe not?

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Speaker 2: So that is for me I think the important part

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Speaker 2: what is the gradient of that growth? Will there be

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Speaker 2: growth for better electric vehicles? Absolutely?

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Speaker 1: So. You have currently like twelve percent of your total

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Speaker 1: sales are all electric, and if you add in plug

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Speaker 1: in hybrids you're getting forts twenty towards twenty percent. Do

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Speaker 1: you expect that to continue to rise into twenty four

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Speaker 1: twenty five?

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Speaker 2: Yes, we plan on a higher share of better electric

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Speaker 2: vehicles sales in twenty twenty four. I cannot talk today

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Speaker 2: about those exact numbers, but definitely we see a higher

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Speaker 2: share in twenty twenty four, and we think we will

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Speaker 2: see an even higher share again in the twenty twenty

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Speaker 2: five as well.

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Speaker 1: What about the production facilities here. I mean BMW is

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Speaker 1: one of the first international luxury car makers to come.

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Speaker 1: I think it was the early nineties that you first

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Speaker 1: put up your plant in Spartanburg. But it's not union.

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Speaker 1: And now that we've seen this drama unfold the UAW

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Speaker 1: getting their contracts with the big three American automakers, are

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Speaker 1: they coming to your shop?

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Speaker 2: Have they called you.

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Speaker 1: Up the.

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Speaker 2: So, first of all, they would probably not call me

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Speaker 2: up because I have a very esteemed colleague down in

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Speaker 2: Spartanburg who is running BMW manufacturing down there, so they

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Speaker 2: will take care of this topic. But from my point

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Speaker 2: of view, we have a huge success story down there,

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Speaker 2: as you just mentioned, it started in ninety four ninety five.

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Speaker 2: And you know, you need good employees, You need good

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Speaker 2: talent to grow the business and to build excellent ultimate

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Speaker 2: driving machines. And I think we treat our employees the

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Speaker 2: right way.

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Speaker 1: So, but you don't expect the union to make approaches

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Speaker 1: or you don't expect those to be successful.

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Speaker 2: I cannot judge what the union will or will not

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Speaker 2: do and in which way. But as I said, I

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Speaker 2: think we have a great relationship with all our employees

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Speaker 2: and we are planning for success in the future as well.

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Speaker 1: All right, I just want to ask also about something

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Speaker 1: that's a little bit quirky, but a lot of car

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Speaker 1: lovers will understand the importance. You recently put manual transmission

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Speaker 1: in the Z four, that's right, which you know a

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Speaker 1: lot of people are worried that manuals, well are aficionados

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Speaker 1: are worried that manuals will die. But the take rate

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Speaker 1: has been fairly high for that car's kind of twin

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Speaker 1: the Toyota Supra. How do you expect the manual version

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Speaker 1: to sell?

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Speaker 2: From the early chatter you hear in the market, I

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Speaker 2: think there will be a lot of officionados who who

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Speaker 2: want to go with the manual transmission. It is still

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Speaker 2: how a lot of us, at least my generation, have

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Speaker 2: actually learned to drive a car, and it definitely has

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Speaker 2: this additional feeling of really be in control of your car.

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Speaker 2: At the same time, when you drive long distances or

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Speaker 2: when you drive in inner city traffic, you also get

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Speaker 2: to appreciate all the advantages of a of an automatic transmission.

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Speaker 2: But the first feedback on that vehicle is very positive.

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Speaker 1: I'm a huge fan of obviously the stick shift, but

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Speaker 1: I also love sometimes the cars take over for me.

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Speaker 1: I think a five Series was the first time I

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Speaker 1: was ever in a car that, you know, I could

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Speaker 1: take my hands off the wheel and it stayed on

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Speaker 1: the autobon. I was in Germany at the time. How

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Speaker 1: long do you think it's going to be until we

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Speaker 1: get to self driving cars, I mean fully automated self

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Speaker 1: driving cars.

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Speaker 2: I would like to focus on what we offer today,

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Speaker 2: because we don't offer that only on the Autobahn in Germany.

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Speaker 2: We offer that on the highway of the United States. Actually,

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Speaker 2: yesterday I drove home in my I seven and I

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Speaker 2: absolutely enjoy that function because we call it ice on

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Speaker 2: the road, hence off the wheel, you stay in charge.

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Speaker 2: It's not fully automated driving. You have to be able

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Speaker 2: to take over in any moment. But it's unbelievable how

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Speaker 2: much more relaxing a driving is if the cards are

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Speaker 2: certain things for you. And this technology will advance further

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Speaker 2: and we will see over the years how it really develops,

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Speaker 2: but it's definitely a great feature already today in the market.

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Speaker 2: All right.

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Speaker 1: My colleague, by the way, Hannah Elliott, has a great

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Speaker 1: review of the I seven on the Bloomberg Terminal. Today

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Speaker 1: it's an absolute battleship. Sebastian, thanks so much for joining us.

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Speaker 1: Sebastian Mackinson there from BMW. He's the North American CEO