Why is BMW replacing Helmut Panke, the company's CEO since 2002, with soft-spoken manufacturing whiz Norbert Reithofer?
Officially, because Panke turns 60 on Aug. 31, reaching the company's mandatory retirement age. But BMW has bent that rule before, notably for longtime boss Eberhard von Kuenheim.
Here is what German analysts and newspapers say are the reasons Panke will be replaced Sept. 1:
- Although he has boosted sales and revenues, BMW's operating profit has not grown proportionately.
- BMW's supervisory board wants an engineer as CEO, to focus on improving quality and introducing more niche models. Panke is BMW's former CFO.
- Panke has angered members of BMW's controlling Quandt family by publicly lobbying to keep his job beyond the retirement age.
BMW's handling of Panke's pending exit upset Munich's daily newspaper. "Panke did not deserve such a hasty farewell," the Sueddeutsche Zeitung wrote last week.
The company is indeed the world's third-most-profitable carmaker. Earnings as a percentage of revenue in 2005, before interest and taxes, were 8.1 percent. That compares with Porsche's 17.3 percent and Toyota's 8.9 percent, according to HypoVereinsbank of Munich.
But critics say that's not good enough. They also say Panke didn't move fast enough to expand the product lineup. New cars introduced in recent years -- such as the X3 and the 1 and 6 series -- were all developed under a previous regime.
Panke had hoped to stay longer.
"I would stay," he told reporters in April. "But the decision is up to the supervisory board."
Panke noted that von Kuenheim served until he was 63. In today's world, Panke said, "60 is not old."
Reithofer, 50, ran BMW's U.S. manufacturing operations in Spartanburg., S.C,. from 1998 to 2000. As global manufacturing boss since then, he is credited with accelerating the company's flexible-manufacturing strategy.
The supervisory board also appointed Frank-Peter Arndt, 50, Reithofer's successor as production boss. Arndt heads the BMW plant in Dingolfing, Germany.
Klaus Draeger, 49, takes over product development and purchasing. He replaces Burkhard Goeschel, 60, who will retire. Draeger is currently responsible for the 5, 6 and 7 series.