BMW has completely new supply chain approach after Covid, says CEO

SHANGHAI: BMW AG has adopted “a completely new approach” to supply chain management as a result of Covid, with a much deeper focus on upstream companies that are three or four steps removed from supplying the German automaker, chief executive officer Oliver Zipse said during the Shanghai auto show.

The process now goes “all the way back” to tier five, six and even seven suppliers in an attempt to limit risk, and BMW is also seeking to do as much manufacturing as possible in the countries it sells cars, Zipse said in a media briefing on Tuesday, noting that the “local-for-local” strategy applies to China as well as Europe and the US.

Currently, BMW doesn’t export China-built cars to the US.

Zipse also said he thought the carmaker’s EV strategy in China has been “absolutely successful,” with first-quarter sales of battery-electric cars in the world’s largest auto market tripling from a year ago.

BMW delivered almost 20,000 units of pure-electric vehicles in China in the first three months of the year.

“The Chinese market is very important for us and our product strategy, which has evolved for the last three or four years, is coming into bloom,” Zipse said.