The BMW Group is moving into a new dimension - 2004 will be the year of new models - Record figures for sales volume and earnings expected

Munich. The BMW Group will continue on its successful growth course during the
financial year 2004. New models and the expansion of sales activities on the
international markets will contribute to new high levels for sales volumes and
earnings. "We expect increasing sales volumes in 2004 for all brands and will
continue to build on the BMW Group's position as one of the most profitable
automobile companies in the world", stated Helmut Panke, Chairman of the Board
of Management of BMW AG, at the Annual Accounts Press Conference on 17 March in
Munich. "As a result of the product and market initiative carried out in recent
years, the BMW Group is now moving into a new dimension. That is the basis for
profitable growth in the future."

Attaining a new level with ten model series
In 2004, the BMW Group will introduce more new vehicle models to the market
than ever before in its history. With the BMW 6 Series, the BMW X3, the BMW 5
Series Touring, the BMW 1 Series and the MINI Convertible, the Group will be
bringing out new products and extending its product range in all of the
important market segments. The up-front expenditure incurred over the past few
years will now produce results. In the words of Helmut Panke: "2004 will be the
year of new models. In future, the BMW Group will be represented in all
relevant market segments with premium products."

The financial year 2003: positive development in all segments
Despite the fact that economic conditions prevailing on some of the world's
automobile markets were difficult, the BMW Group set a new sales volume record
with 1,104,916 BMW, MINI and Rolls-Royce brand cars during the financial year
2003. This was 4.5% ahead of the previous year's record (2002: 1,057,344 cars).

The BMW Group was able to increase market share in a number of the main
markets. The sales volume in the USA, at 277,037 units, was 8.0% up on the
previous year (2002: 256,622 cars).

The BMW Group sold 637,949 cars in Western Europe, 1.9% more than in the
previous year (2002: 626,219 cars). This included 255,821 cars sold on the
German market (-0.9% / 2002: 258,170 cars). A total of 93,030 BMW, MINI and
Rolls-Royce brand cars were sold in Asia, 18.5% more than in the previous year
(2002: 78,527 cars).

Influenced by product-life cycles, sales volume growth picked up momentum
significantly in the course of the second half of 2003. The main reason for
this development was the launch of the new BMW 5 Series Sedan in July 2003. By
the year-end, 70,522 cars had been sold. Overall, the sales volume of the BMW 5
Series, at 185,481 cars, surpassed the previous year's figure by 7.6% (2002:
172,323 cars). The BMW 7 Series also provided growth momentum in 2003, with the
sales volume rising by 8.2% to 57,899 units, thus achieving the highest ever
sales volume in a single year since its introduction at the end of the 1970s.

Overall, the BMW Group delivered 928,151 BMW cars to customers in 2003, 1.6%
more than in the previous year (2002: 913,225 cars).

The success of the MINI brand continued in 2003 and contributed substantially
to the sales volume growth of the BMW Group. With a total of 176,465 Mini brand
cars sold, unit sales were almost a quarter higher (22.4%) than in the previous
year.

With the Rolls-Royce brand, the BMW Group has expanded its range of products
into the very top end of the luxury segment. 300 Rolls-Royce motor cars had
been handed over to customers by the end of 2003.

In 2003, the motorcycle business as a whole was affected by adverse economic
conditions on the international motorcycle markets. The Motorcycles segment
held its own within this difficult environment. With 92,962 units sold, the
sale volume surpassed the previous year's level for the eleventh year in
succession. (+0.4% / 2002: 92,599 motorcycles). BMW motorcycles were, for
example, again able to defend their position as market leader in Germany.

The Financial Services segment also continued its growth course in 2003. The
number of new contracts signed rose by 14.2% to a new high level of 1,578,829
contracts (2002: 1,382,148 contracts). The business volume of the segment
climbed in 2003 by 8.1% to stand at euro 28,647 million (2002: euro 26,505
million).

More than 3,000 new jobs created
In conjunction with the expansion of business, the BMW Group workforce also
increased during the past financial year. At the end of 2003, the BMW Group had
a worldwide workforce of 104,342 employees, 2.9% more than at the end of 2002.
After adjusting for disposals and transfers of group companies, the Group
created 3,131 new jobs. Three quarters of the BMW Group's employees are based
in Germany. The workforce here increased to 78,569 employees (+3.2% / 2002:
76,143 employees).

The BMW Group's focused need for additional trained staff will continue in
2004.

Significant momentum in earnings growth as 2003 progressed
As with the development in sales volumes, revenues and earnings also showed the
expected dynamic improvement during the second half of 2003 as the positive
effects of the BMW 3 Series and BMW X5 model up-dates and the new BMW 5 Series
Sedan gained ground.

Group revenues in 2003, at euro 41,525 million, were 2.1% lower than in the
previous year as a consequence of the low US dollar exchange rate against the
euro (2002: euro 42,411 million). Adjusted for changes in exchange rates, the
Group achieved a sales revenue growth of 4.2%.

At euro 3,205 million, the Group profit from ordinary activities almost matched
the previous record level reported in 2002 (-2.8% / 2002: euro 3,297 million.
The net profit of the BMW Group was euro 1,947 million, 3.6% down against the
previous year (2002: euro 2,020 million).

Helmut Panke: "In spite of the high level of up-front expenditure for new
models and a difficult economic climate, we were still able to achieve earnings
at the previous year's high level. This again demonstrates the underlying
strength of the BMW Group."

The announcement of changes to statutory regulations relating to early
retirement part-time working arrangements held earnings back and resulted in
additional provisions of euro 110 million. Moreover, changes in German tax
legislation relating to the treatment of existing corporation tax credits led
to an exceptional tax expense of euro 50 million for the financial year 2003.
Excluding these one-off items, the net profit for the year would have been euro
2,063 million.

The pre-tax return on sales at a Group level was 7.7% (2002: 7.8%). Earnings
per share were euro 2.89 (2002: euro 3.00) per share of common stock and euro
2.91 per share of preferred stock (2002: euro 3.02).

Proposed dividend increase
In view of the sustained high quality of earnings and the positive outlook for
business, the Board of Management and the Supervisory Board have proposed an
increased dividend. Subject to approval, the unappropriated profit available
for distribution in BMW AG of euro 392 million will be used to pay a dividend
of euro 0.58 for each common stock share (2002: euro 0.52), 12% higher than in
the previous year and a dividend of euro 0.60 for each preferred stock share
(2002: euro 0.54), 11% higher than in the previous year. Share capital entitled
to receive dividends amounts to euro 673.5 million (622.2 million common stock
shares and 51.3 million preferred stock shares, each with a nominal value of
1 euro).

Capital expenditure and cash flow increased again
The BMW Group is laying the foundations for continued expansion in the years
ahead with high levels of capital expenditure. In 2003, the Group invested euro
3,249 million in intangible assets and property, plant and equipment (2002:
euro 3,184 million).

On top of this came development costs of euro 996 million (2002: euro 858
million) which are required to be recognised as assets in accordance with IAS
38, so that total additions to intangible assets and property, plant and
equipment amounted to euro 4,245 million (2002: euro 4,042 million). This
represents an increase of 5.0%. At 38.9 %, the proportion of development costs
recognised as assets remains relatively low in comparison to the industry as a
whole (2002: 34.9%).

Including capitalised development costs, the investment rate (i.e. capital
expenditure as a percentage of group revenues) increased to 10.2% in 2003,
which is higher than the previous highest rate recorded in 2002 (9.5%). This
above-average increase was mainly attributable to the currency-related lower
level of revenues.

Cash flow in 2003 rose by 2.7% to a new record level of euro 4,490 million
(2002: euro 4,374 million) and thus once again exceeded capital expenditure.

R&D costs at previous year's level
Research and development costs, at euro 2,146 million, were at a similarly high
level to the previous year level (2002: euro 2,133 million). They represent 5.2
% (2002: 5.0%) of revenues. Research and development costs include depreciation
and disposals of euro 583 million (2002: euro 536 million) relating to
development costs recognised as assets. Total research and development costs,
including research costs and non-capitalised development costs, amounted to
euro 2,559 million (2002: euro 2,455 million). At this level, the research and
development ratio was 6.2 % (2002: 5.8%) of revenues.

Production capacities still fully utilised
As with sales volume, the BMW Group also achieved new production volume records
for cars in 2003. 1,118,940 BMW, MINI and Rolls-Royce brand cars were
manufactured (2002: 1,090,258), 2.6% more than in the previous year (including
contract production of the BMW X3).

Production of BMW cars was affected to an exceptional extent in 2003 by the
product initiative. The Group was able to carry out its ambitious programme
with the aid of flexible work-time arrangements and on-going process
optimisation. In 2003, 944,072 BMW cars came off the production lines, 1.5%
more than in the previous year (930,221). On top of this, 174,366 MINI brand
cars were manufactured, an increase of 9.0% compared to 2002 (160,037). The
production start-up phase for the Rolls-Royce Phantom was completed. At
present, five motor vehicles are being manufactured per day. Overall, 502
Rolls-Royce Phantoms were manufactured in 2003.

* * *

The complete Annual Report 2003 can be downloaded from the Group's website
under www.bmwgroup.com.

For questions please contact:

Corporate Communications

Eckhard Wannieck, Finance Communications
Telephone: (+49 89) 382-24118, Fax: (+49 89) 382-24418

Marc Hassinger, Business and Finance Communications
Telephone: (+49 89) 382-23362, Fax: (+49 89) 382-24418

Media Website: www.press.bmwgroup.com
e-mail: presse@bmwgroup.com

**Please find the complete press release in the attached documend for
downloading including a table "BMW Group in figures".