BMW announces restructuring and 20% management cut via AI

BMW Group has announced a major restructuring plan aimed at reducing costs and increasing efficiency through the integration of artificial intelligence. A central component of this strategy is a 20 per cent reduction in management divisions and associated leadership positions by mid-2027. This move targets high-level roles, including senior vice presidents, to create a leaner and more agile organizational structure.

The restructuring follows significant financial pressure, including profit warnings and declining sales in the Chinese market. To combat competition and rising costs, BMW plans to increase production localization in China and move away from manufacturing all components in-house, opting instead for more generic, industry-standard parts.

Additionally, the company is implementing a broader workforce reduction in Germany, targeting approximately 8,000 positions, primarily in administration, research, and development. CEO Milan Nedeljković stated that these measures are necessary to improve the company’s cost base and remain competitive in a rapidly changing global automotive landscape.