The Hunt For BMW's New CEO Begins [UPDATE: That Was Fast!]

Matt Posky
by Matt Posky
the hunt for bmws new ceo begins update that was fast

With Harald Krüger out, BMW needs a new CEO — one that can effectively transition the company into becoming and electrified automotive dreamscape. Krüger presumably wasn’t interested in taking that path. While that hardly makes him a monster, plenty of people felt that his reluctance to spend ludicrous amounts of money on developing EVs was tanking the company’s share price and making him look like a fool. Not us, though. Bending to investors every whim and chasing down trends with minimal foresight seems like top-tier dipshittery. But that’s the nature of the industry right now, for better or worse.

However, in the short term, it pays to promote electrification and Krüger’s measured strategy of gradually introducing more EVs via a flexible architecture was often seen as too conservative. Perhaps that’s the correct assertion and some new blood is in order at BMW if it’s to correct its course. But who do you pick?

Oliver Zipse, according to Reuters. BMW said Zipse’s manufacturing expertise would be a blessing and, as he’s already the board member responsible for production, his knowledge of the company’s inner workings are already vast.

From Reuters:

Zipse has emerged as favorite because BMW’s efficient production network, which he expanded in Hungary, China and the United States, has helped the company deliver industry-leading profit margins despite its relatively small scale.

But experts say auto industry leaders also need other skills for the new era of software-driven electric and autonomous cars.

“A CEO needs to have an idea for how mobility will evolve in future. This goes far beyond optimizing an existing business,” said Carsten Breitfeld, chief executive of China-based ICONIQ motors, himself a former BMW engineer.

“He needs to be able to build teams, to attract key talent, and to promote a culture which is increasingly oriented along consumer electronics and internet dynamics.”

Being able to cope with shorter product cycles and new technologies, and a willingness to take bold decisions, are among the qualities needed, Breitfeld said.

Apparently, Krüger didn’t have those qualities… or did and simply backed away from electrification after BMW’s i3 proved to be a poor source of revenue. However, shying away from EVs had a chilling effect on engineers — sending some to rival manufacturers that were happier to focus on electrics. But suggestions that Krüger totally ignored the mobility shift are complete garbage.

BMW is among the first automakers to integrate Amazon’s Alexa directly into its multimedia system and has dabbled in some of the most aggressive connectivity features of any major manufacturer. It also recently said that every single one of its plug-in hybrid vehicles would have the ability to automatically switch to electric mode whenever it enters an area designated for “emissions-free driving” by 2020. BMW is even planing on introducing an app-based rewards points system that could pave the way for in-car micro-transactions. These aren’t exactly concepts we’re thrilled to see implemented into cars but they don’t represent a backwards-looking automaker.

Even though it did tamp down electrification plans, the company wasn’t ignoring EVs so much as trying to find a balance that would support more electrification further down the line (once the larger market is ready for them). “We can’t afford having two factories standing still,” Krüger said in 2018. “With a flexible approach, you can always manage the capacity of your plants. But if you have a specific EV architecture, what do you with the old one? What do you do with the people?”

That’ll be a question BMW’s next CEO will, no doubt, have to answer. But Reuters expects the broader issue has nothing to do with competing with rival manufacturers or keeping factories humming. It posited that BMW (and all automakers) need to find out how to become more than equipment suppliers for big tech. “Production expertise is important, but if you want to avoid ending up being a hardware provider for Google or Apple, you need to have the ability to move up the food chain into data and software,” a former BMW board member told the outlet, declining to be identified.

While continuously advancing software is incredibly important these days, it remains slightly bizarre that simply being a carmaker is no longer enough for ⁠— ahem ⁠— carmakers. The more time passes, the more they all seem to want to become Google. To us, that’s more than a little worrying. To investors, that’s the dream.

[Update 7/18/2019: Rather than narrowing the field, BMW’s supervisory board voted to give Zipse the CEO role during Thursday’s meeting in Spartanburg, South Carolina. He will take over August 16th, replacing Krüger, who will step down from the top job in August. The rest of the above still applies. Good luck, Zipsey!]

[Image: Cineberg/Shutterstock]

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2 of 23 comments
  • Cognoscenti Cognoscenti on Jul 19, 2019

    So sad to see BMW being slowly but surely forced to give up their mission and adopt a new one that looks like everyone else's. Now that has even impacted the CEO.

  • Brett Woods Brett Woods on Jul 19, 2019

    I have been a big BMW fan over the years, so yes I'm concerned. Agree that chasing trends with minimal foresight is like having style, but not any substance. Reminds me of Heinlein's The Puppet Masters, where people had all the right moves and all the right looks, but they didn't succeed with those close to them because they only had puddle depth mentality. As the former BMW engineer says, real leaders go far beyond optimizing an existing business. In a time of worldwide change, top auto leadership can't be adequately or successfully managed by a sophisticated imitator wrapped in a tough shell and buoyed by self-love (my take on the product output). Those qualities, while incredibly useful, are just not enough to navigate the changing environment.

  • MaintenanceCosts We hear endlessly from the usual suspects about the scenarios where EVs don't work as well as gas cars. We never hear the opposite side of the coin. From an EV owner (since 2019) who has a second EV reserved, here are a few points the "I road trip 1000 miles every day" crowd won't tell you about:[list][*]When you have a convenient charging situation, EV fueling is more convenient than a gas car. There is no stopping at gas stations and you start every day with a full tank.[/*][*]Where there are no-idling rules (school pickup/dropoff, lines for ferries or services, city loading, whatever else) you can keep warm or cool to your heart's content in your EV.[/*][*]In the cold, EVs will give you heat from the second you turn them on.[/*][*]EVs don't care one bit if you use them for tons of very short trips. Their mechanicals don't need to boil off condensation. (Just tonight, I used my EV to drive six blocks, because it was 31 degrees and raining, and walking would have been unpleasant.)[/*][*]EVs don't stink and don't make you breathe carcinogens on cold start.[/*][*]EV maintenance is much less frequent and much cheaper, eliminating almost all items having to do with engine, transmission, or brakes in a gas car. In most EVs the maintenance schedule consists of battery coolant changes and tire maintenance.[/*][*]You can accelerate fast in EVs without noisily attracting the attention of the cops and every passerby on the street.[/*][/list]
  • MaintenanceCosts Still can't get a RAV4 Prime for love or money. Availability of normal hybrid RAV4s and Highlanders is only slightly better. At least around here I think Toyota could sell twice the number of vehicles that they are actually bringing in at the moment.
  • Tree Trunk Been in the market for a new Highlander Hybrid, it is sold out with order time of 6 months plus. Probably would have bit the bullet if it was not for the dealers the refuse to take an order but instead want to sell from allotment whether it fits or not and at thousands over MRSP.
  • AKHusky The expense argument is nonsense. My mach e was $42k after tax credit. Basically the same as similarly equipped edge. And it completely ignores that the best selling vehicles are Rams, F150s, and Silverados, all more expensive that a bolt, MAch e or ID4. As an owner, I'd say they are still in second car territory for most places in the country.
  • Johnster I live in a red state and I see quite a few EVs being purchased by conservative, upper-class Republicans (many of them Trump-supporters). I suspect that it is a way for them to flaunt their wealth and that, over time, the preference for EVs will trickle down to less well-off Republicans.