MINI at 2005 Frankfurt Auto Show

Dr Michael Ganal Member of the Board of Management of BMW AG

MINI Press Conference 61st International Motor Show (IAA) cars 2005 Frankfurt, 12 September 2005

Ladies and gentlemen,

First off, let me thank you for visiting MINI today, which isn’t quite as easy this year as it used to be, due to the schedule-related setup situation in some of the halls. I’m all the happier to see you here.

There are two questions that I would like to discuss:

• First: Where does the MINI brand stand today? • And second: What’s hidden under this cover?

Let me begin with the current situation of the MINI brand.

MINI is continuing to grow in fiscal 2005. During the first eight months of this year we delivered a worldwide total of more than 139,000 MINIs to our customers – over 16,000 vehicles more than during the first eight months of the previous year. As of August 2005, this constitutes an increase of 13.3 percent over the same period last year.

Based on this recent development, we predict that the MINI brand will set a new sales record in the full year 2005. To be specific: we want to hit the magic 200,000 mark this year.

This would mean that the MINI brand has sold more vehicles in each consecutive year since its relaunch, and has thus defied all conventional rules regarding the sales curves of automobiles. The MINI is characterized by an atypical life cycle.

Clearly, the MINI is not a one-hit wonder but rather a timeless classic:

• In Germany, the 100,000th MINI was delivered to a customer late last month. • In the United States, MINI has been able to capture more than 100,000 customers so far. • Overall, the 700,000th MINI will be delivered to a customer this year.

These numbers illustrate that the MINI community in over 70 countries is growing.

The MINI brand is now one of the BMW Group’s important retail pillars. Worldwide, MINI contributes about 15 percent to the Group’s overall automobile retail volume. In its home country, the U.K., the brand contributes almost one third. And in markets like Italy, Mexico or Japan, the numbers are almost as high.

This demonstrates that MINI is a strong and independent premium brand. In the years since its relaunch, it has been able to claim a key position within our company and across international markets.

Ladies and gentlemen,

The mere number of units sold tells only part of the MINI success story – because the brand’s model mix is equally remarkable:

• 27 percent of all MINI vehicles sold are MINI One models. • 46 percent of our customers chose a MINI Cooper. • And 27 percent of MINI buyers preferred a MINI Cooper S.

These numbers show that our clients are especially interested in our more upscale versions with more powerful engines. It seems that our customers have adopted the motto: The more MINI the better.

In Europe, the average retail price for a MINI is about 21,000 euros – the kind of money typically spent on medium-sized vehicles. This highlights the fact that, while the MINI is a small car in terms of its measurements, it is truly a premium small car – and that’s what makes all the difference.

MINI stands for premium brand product substance. MINI also stands for a special kind of driving experience. And most important: MINI offers customized solutions that are otherwise unheard of in the small car segment. All of this makes the MINI different and successful.

Ladies and gentlemen,

The ongoing success of the MINI brand obviously provides a strong motivation for us to continue expanding the MINI family and to offer new versions of the brand.

Our MINI Convertible was already a step in this direction. We launched our Convertible last year in July and have been very successful with it ever since. One out of four MINIs worldwide is already a Convertible. In certain markets, such as the U.K., MINI is actually the segment leader for small car convertibles, including hard-top convertibles.

Our MINI Convertible was an important step toward expanding the MINI brand because it embodies our brand values in a very authentic way, even as it puts a new spin on them.

Of course we’re thinking hard about what our next step should be after the MINI Convertible. Which brings me to my second question: What’s under the cover?

I’ll be brief and won’t keep you in suspense for too long. We have brought along a MINI concept study for you – basically an idea of where the MINI brand might be headed. This MINI concept study could become a third face for the MINI, distinguishing it from the multitude of small cars.

Of course this vehicle has all the characteristics that people expect from a MINI. It still features that unique go-cart feeling, the high-grade materials of a true premium vehicle, and that unmistakable MINI design. And of course it is anything but an ordinary vehicle – like all MINIs, it features some surprising solutions. Let me just mention the split-doors here, which you’re going to see in a moment.

The idea behind this MINI concept study is to allow for a combination of individuality and more flexibility. We know that an increasing number of people want to coordinate work and leisure more effectively. This is where the MINI comes in, because it addresses customers’ individual needs more directly and more flexibly – and because the MINI means driving fun, unique design and a special life experience. Hence our motto, “MINI your Day” – which you’ll encounter again and again at our stand this year. And this is also exactly what our MINI concept vehicle is all about.

Some of you may find this vehicle reminiscent of a classic concept from days gone by. And that may prompt the question: Are we reviving one of the brand’s classic vehicles? The answer is both yes and no. On the one hand, it is true – this idea does hark back to history. On the other hand, its implementation is guided entirely by the principles of the new MINI brand. In this form – as a premium vehicle – this vehicle has never existed before. Therefore, the best way to describe it is: “From the Original to the Original.”

But enough talk. I know that you’re eager to actually see our MINI concept study now. So let me thank you for listening. Continue to enjoy the IAA 2005 – and “MINI your Day”!