In a significant shift in its sales strategy, BMW (ETR:BMWG) announced on Wednesday that it will begin selling vehicles directly to customers across Europe starting next year, mirroring a model employed by Tesla (NASDAQ:TSLA). The initiative will initially be launched with the Mini brand in Italy, Poland, and Sweden, followed by a broader rollout.
BMW's market cap, as per InvestingPro Data, is currently at a whopping 66543.26M USD, making it a prominent player in the automobile industry, as highlighted by InvestingPro Tips. The company's P/E ratio stands at 5.63, indicating it is trading at a low earnings multiple, a factor that can make it an attractive investment opportunity.
By 2026, BMW's own brand is also expected to transition to this direct sales model. The new approach is aimed at standardizing pricing for identical models and enhancing direct communication with customers. It will offer buyers the flexibility of online or physical purchases through a digitalized buying process.
BMW's European retail partners have expressed their approval of the move, as evidenced by agency contracts signed by all Mini partners. Under the new arrangement, retailers are set to earn a fixed commission from vehicle sales.
This initiative marks a significant change in BMW's business model and reflects the growing trend toward direct-to-consumer sales in the automotive industry. The move is expected to streamline operations and offer a more consistent experience for customers throughout Europe.
BMW's financial health also appears to be stable with a significant dividend yield of 8.65% as reported by InvestingPro Data. The company has maintained dividend payments for 32 consecutive years according to InvestingPro Tips, making it a reliable choice for income-focused investors. BMW's revenue growth in the last twelve months (LTM2023.Q2) was 23.79%, indicating a solid performance despite the challenging market conditions.
For investors interested in more insights like these, InvestingPro offers a wealth of additional tips and real-time metrics.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.