Friday, September 20, 2013

BMW: Breakneck Growth in China Is Over

          BMW is on an economic crisis based on its exports to the Chinese market. It expects a drop by 0.05 % in the profit margins on the cars it exports to China. This could be because of the opening up of the Chinese market to foreign investors like BMW in Germany. The economy of china has been elevated gradually. This is at an annual growth rate of 19% between 1989 and 2010. It has also been coupled with several outputs. These have grown at a rate of about17 % every year during the period of time. It is considered as a rapid economic growth rate in a period of less than two decades. There has been influx of BMW cars the Chinese market. In fact, China is presently one of the most famous destinations to international investors in the world including those from the western countries like USA, Germany and other European economies.

           Germany has had a very cordial trade relationship with China, but the current influx of the FDIs have left the two countries in disarray and this has greatly affected the operations of the firm BMW in the country especially in dealing with its exports to this country. China leads in terms of direst traverse border investments among developing countries in a worldwide scale. Since the year 1980, the inflow for BMW cars in China is over one third of the total inflow of the same product in other developing countries. After 2007, China became the second importer of BMW cars after the US. Therefore, there is no doubt that the development in the influx of BMW cars in China. This has led to the expansion of the economy of this country in unimaginable heights.

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