Colleagues, welcome back to our second part of our quarterly conference. We're going to continue in German. We're looking forward to your questions. First of all, there are some technical instructions before we then get started with the first question. Ladies and gentlemen, we're going to start with a Q&A session. If you want to ask a question, please. If you dialed in, then please use the asterisk plus nine, and then you're being called upon to ask a question. As soon as you hear your name, you can ask your question. To withdraw your question, also use the function in the Zoom app, and when you're using the phone, use asterisk and nine. First question, please. Our first question is by Christina Amann by Thomson Reuters. Please switch on your microphone. Good morning. I was able to switch on my mic. Good morning, gentlemen, Mr. Zipse, Mr. Mertl. I have a number of questions. Mr. Mertl, you talked about mitigating measures which were introduced by BMW in order to offset the tariff effects, and then you mentioned that in the second quarter, the tariffs will have a more pronounced effect in the books. Can you give us some more information about that in terms of figures? Mr. Zipse, you were quite hopeful before that your talks on several political levels will provide progress in terms of free trade. Maybe you can tell us more about that, why you're so optimistic here, and what to expect here, what are you doing, who you are talking to, and also the forecast as of June, the tariffs might go down again. Why are you so optimistic about that? The last question is, what does the situation look like in China? Business is not going too well. The competitors are doing badly, and BMW is also feeling it. What is your outlook for China? Thank you, Ms. Ahman. We're dealing with China and the mitigating measures that's dealt with by Mr. Mertl and the rest by Mr. Zipse. Good morning, Ms. Ahman. As I said earlier, we were the first ones in March, which set aside 1% of EBIT for all the tariffs as of March 12th until March 5th. Of course, the tariffs for CBUs in the U.S.A. have been added 25% on top. As I said last week, we had the last executive order that there would be no additional on top or additive taxes, no more stacking. That is not going to happen. That is the first impact. The second impact is that there's also a reduction of 3.75% of mSAP, not for the cost, but for the local production in Spartanburg. That has a major effect and mitigates the U.S. import tariffs as of March 12th on top. I just wanted to point out what our footprint looks like. It is different compared to our competitors. Let me stress that once again, we are set up differently. We have been producing in the U.S., for example, the X3 and the X4, which others are not doing, and also the X5 and X6 and X7. That is different. I also added that the impact, and that happened since March 12th, though, 125% and 145% between America and China. They have hardly any effect on us either because we also have a very strong footprint in China. That might also look different for our competitors. We have a negligible part which we're shipping from the U.S. to China, and therefore it doesn't have a major effect on us. Also, something you shouldn't overlook is compared to our competitors, we have a joint venture, BBA, with a 75% share. So we are participating from the local margin. There are different effects you have to take into account. Of course, we have also other mitigation topics. For example, parts and components, they have been shipped earlier into the country, but also other OEMs did that. Of course, we are set up very well in our market. Our inventory is at 30 days. Some of our competitors are at 45 days or even more. That also has an effect. We are also leveraging everything we can do. There is a whole bunch of topics which helps us restructure our production because of our global footprint, and we are making use of that. That is something I need to say firstly. Also, we are following the news and the media, and we can see that things are happening, and negotiations are taking place. Through all the networks which are at our disposal, we believe that there will be some changes as of July. We are not saying that it will go down to zero. That would be our hope. We do expect that the impact will be reduced. Back to your second quarter question, I cannot give you any figures exactly, only for the yearly figures. We are looking at 5-7%, including all the tariffs and including mitigation measures. That means that in a first step, everything which we have imported in March and in April, that will have an effect. The tariffs which will be lowered as of July, as we expect, that will have an effect on Q3. The major effect will be in Q2, and after that, it will go down again. About China briefly, in March, we already mentioned that we will be on the volume and price level of the second half of 2024. That will be the start for 2025 as well. In our forecast, we wrote that it means that the first quarter will have an impact. Also, the second quarter will have an impact where it also got weaker last year, but it has less of an impact because it will be the level of the second half of last year as far as volume and price goes. It stabilizes. In the first half year, it will be the biggest impact of China. The X3, which has been available in other parts of the world and in China, was only launched in February. The ramp-up curve will improve as of Q2. Therefore, we still adhere to our forecast. Thank you, Walter. Mr. Zipse, please. Ms. Ahman, let me mention two things. These two things determine our discussion, which we have on several levels in Washington as well as in South Carolina and in the EU. First of all, we are trying to tell all parties concerned that the world is highly interlinked. If you look at a movement going from a resource to a final product, you cannot turn it back. That is different from the 1970s and 1980s. In the end, there will only be losers if you want to lock yourself off from the outside. That is the first thing we are communicating and what we are trying to do. The second is specific to the United States. There are three elements caused by the tariffs. In the short term, if the effects of the tariffs between the U.S. and Canada and Mexico, for example, we believe that the NAFTA will be restituted once again because they are so tightly connected. It will take a while until a new negotiation system is put into place. That is what we assume because the disadvantages are far too big for everybody. Secondly, and this is something specific to BMW, we have a high value added in the U.S., and we're exporting a lot. At Spartanburg, which is our largest plant, we have produced more than 7 million vehicles in the past years. In 2024, we produced 400,000 vehicles. That means last year, we sold 225,000 vehicles, more than 50%, and exported them. That means we were the largest automotive exporter according to value in the U.S. Since 2014, we have exported 2.7 million vehicles. That means two-thirds of the whole production was an export value of more than $100 billion. We have made huge investments for that and what is happening right now. That is quite relevant for the current discussion for the production of fully electric vehicles in the U.S. We're investing currently $1.7 billion, $1 billion for the BEV production close to Spartanburg. That is something we already started back in 2022, or we announced it back then. Our activities in South Carolina, we have 43,000 jobs and $3 billion in wages. BMW stands for a total economic effect of EUR 26 billion in South Carolina. Since we're the largest exporter, we believe that in some way, shape, or form, that will have an effect in our negotiations. How it will have an effect, we cannot tell you exactly, but we can see that it will not ignore our large footprint there. These are the two important things in the current discussion. Thank you. Thank you, Oliver Zipse. Next question, please. My next question is by Markus Fasse from Handelsblatt. Good morning, gentlemen. I would like to add to that, since you're having such constructive dialogues in the United States, there are also tariffs of 10% from the U.S. into the EU. Will you also be able to discuss that? Can you also solve that in your negotiations with the EU as well? Because you would also profit from that, and that could also strengthen your negotiating position in the U.S. Maybe you can suggest a solution here as well. The second question refers to China as well. I think a decrease of 17% is quite substantial. Apparently, you did not take part in the price war because it's not worth it for you. You were in Shanghai, and you've seen how the market has changed. Can you tell us something about how you see the market and what your strategy is so that you do not lose more ground to Chinese competitors? Thank you. Thank you, Mr. Fasse. Both answers will be provided by Mr. Zipse. Good morning, Mr. Fasse. First of all, about the tariffs once again. If we take a look at the world, currently, everybody's going against everybody with tariffs. We want to abolish tariffs, abolish tariffs on the basis of cooperations and negotiated agreements. Of course, you need to see eye to eye and establish justice in trade relations. Therefore, we want to reduce it to zero for the U.S. as well as for the EU. When we look at the 10% from the U.S. to Europe, that has been in place for many, many years, and it has never threatened our business model. In the other direction, it was 2.5%. And 2.5%, that's almost, I mean, the admin costs are almost higher than the tariffs. Zero-zero is our core demand. We should also not overlook, and it's also good that you mentioned it, between China and Europe, there is also an import tariff induced by the EU by 30%. The higher tariffs are not caused by the U.S., but by the EU as far as Chinese vehicles, Chinese electric vehicles are concerned. That leads to a massive distortion of the market. It also prevents in the lower market segments that electric vehicles will be provided for the customers. That's also part of our overall arguments we have. Back to China, China's quite interesting. The figure you mentioned is, of course, not positive. First of all, we are by it is still the largest market for us, and we're still looking good compared to our competitors. What is happening and what we should be doing is we also restructuring our dealership structure. In a time of exponential growth, of course, there were sales structures which were no longer efficient. I am actually in favor of restructuring that quickly. That is part of the 70% as well, but that will be over shortly. We expect for the second half of the year, we expect a significant stabilization. You will no longer see these decreases, and you will also see that in the second quarter already that these figures will be reduced. We are dealing with that boldly. As you said, the price war doesn't make sense. The Shanghai Motor Show showed us that we are quite competitive. This decrease has nothing to do with a lack of competitiveness. There are some structural topics which we're working on. Then BMW, just like in the previous years, with around 700,000 vehicles. That's what we will see. That is my answer to that. Thank you, Mr. Zipse. The next question, please. The next question is by Daniel Zwick from WELT. Please switch on your microphone. Good morning. Thank you. I've got two questions. First of all, about the United States. Mr. Zipse, is it correct that you together with two other gentlemen, you talked to Donald Trump directly? If so, then of course, you're not going to be able to tell us some details, but what's your impression? What did you offer the U.S. government in order to show willingness that you're making a step towards the government there? I have a second question about Europe. Yesterday, there was an interview published by the heads of Renault and Stellantis, and they complained that in Europe, there is an over-regulation for vehicles, which can be traced back to the premium manufacturers of Germany, and they want less strict regulations for small vehicles. Would you agree with that? Is there an over-regulation, and are you responsible for it? Thank you, Mr. Zwick. Mr. Zipse will be answering both questions. Good morning, Mr. Zwick. Once again, about the United States. As you know, we have been in the U.S. for very many years. We have deep roots there. That is true for our political relations as well. We have had the closest dialogue with different stakeholders on a state level, not only South Carolina, but also California, but also on a national level. That means also political representatives on all different levels, of course. Apart from that, I cannot give you more information and comment on speculation. The second question about the EU regulation or over-regulation. Of course, I read the interview as well. Of course, there is some truth to it. Of course, we are over-regulated in Europe. You know my arguments. Europe is focusing on exit regulations instead of thinking about how to get in with their regulations. Everything is being over-regulated. What both of the gentlemen have said, the sum of all the regulations that hems the industry in Europe. I say that quite clearly and openly. I mean, I can only underline that referring to that interview. That does not mean that we can get rid of everything, but we should do it in such a way so that it becomes beneficial to the citizens, reduces CO2, reduces accidents. How it is being done, I mean, it's always a little too much of everything. Of course, there should be whether there should be different regulations for different vehicle segments. That is a difficult topic because you're all acting in the same traffic environment, and you don't want to have different safety standards for different vehicle segments. Of course, there could be different segments. Maybe you could have city cars which are not allowed on freeways. That is something that could be discussed. I would not divide the automotive industry in two parts. The small cars on the one hand with other safety requirements. I mean, reducing over-regulation is correct. Different segmentation, that is something you need to look at very carefully unless or if you do not want to create an unfair competition. Thank you, Mr. Zwick. Next question, please. The next question is by Wilfried Eckl-Dorna from Bloomberg News. Please switch on your microphone. Hello. I hope you can hear me. I have two very short questions. On the one hand, I wanted to know from Mr. Zipse and Mr. Mertl, you have mentioned in your outlook that for some markets or several markets, you expect an increasing demand for quite a lot of markets because of lower inflation. In which markets do you expect an increasing demand? Obviously, it is not China, but maybe you can give us more information. Where do you expect an increase in demand for this year? The second question is towards the tariffs. Maybe you can tell us more in the negotiations with the U.S. government. Maybe you can tell us more about the communication there. You said that you believe that you have a very strong argument because of your big footprint in Spartanburg. How does the other side react to that when you're using that argument? Thank you, Mr. Eckl-Dorna. Mr. Mertl will start. Good morning, Mr. Eckl-Dorna. Our forecast is saying that we're growing in almost all of the markets with the exception of China. We never forecasted that for China. In the U.S., we have an effect in March and in April where we're doing well, more than 4% growth as of March. Also in Europe, we have been growing as of March by over 6%. We believe that this growth will continue. In China, as I said earlier, in March, we already said that we will see a similar level compared to the second half of 2024, especially the Q4 was weak in China. We do not want to repeat that. With the Q3, it looks pretty, compared to the Q3, the current situation looks similar. Mr. Zipse, we are happy that we have a new government, and we congratulate the Chancellor that he has been elected. Hopefully, it will be decisive that they start their work soon in order to deal with the challenges. Our core arguments, our main arguments, we want to see a greater focus on the automotive industry. We have said we want to be open in terms of technology. We want to drive innovation forward, but also we want to reduce CO2. We want to safeguard our competitiveness in a global industry. It is very important in Germany. There are a lot of global companies which not only have to be successful in Europe, but worldwide. They have a leading role worldwide that also includes the U.S. and North America as a whole, but also the Chinese market as well as other Asian markets. It is very important that these worldwide links, which characterize Germany and Europe, need to be focused on, that we have this international network. Next question by Stephen William from Wall Street Journal. Please switch on your microphone. Hi there. It's Stephen Wilmot here from the Wall Street Journal. To go back to the tariff questions, it sounds like the 3.75% tariff rebate for parts has been one of the drivers of your maintained guidance. As you all know, obviously, this rebate is temporary. It is supposed to fall next year and then disappear the year after. Of course, we do not know how things will actually turn out. You also were saying that you believe the NAFTA, USMCA will be restored. In the logic of that, i.e., that parts will not be tariffed from Mexico and Canada perhaps, but they will be in future from elsewhere. Is there a logic to localizing more of your supply chain for Spartanburg, such as powertrains, to reduce your tariff exposure longer term? Is that something that you have been exploring? Is there anything you can say about that? Second question, a bit more briefly, is do you see any signs of a demand response in the U.S. as a result of the imposition of tariffs? Any nervousness among consumers, for example? Thank you. Thank you for your question. What is happening currently is we are investing in the drivetrains in the U.S. for the fully electric vehicles. We're investing currently $1.2 billion, $1 billion for the BEV production in Spartanburg, and $700 million for the high-voltage batteries in Woodruff. These are the investments which we're doing locally. That is part of the drivetrain, of course, because our drivetrains, as you know, they not only consist of ICEs, but also they consist of electric drives. We're investing there where we need to create new capacities where we want to grow. That is mainly the electric drives right now. To answer your question, we're doing exactly that, more localization in order to enable our growth. As far as the North American market is concerned, we are quite confident that we can generate further growth with our products. We do not want to remain on a status quo where we are trying to safeguard what we have achieved so far. No, we see a growth potential there, and that is why we are investing there. Your first question, USMCA, that is a very logical construct. We are all parties concerned profiting. That means more localization is being useful. It also leads to the effect that you can export more. This, what I call the export credit, can be included in this logic. That would be a good result if we were to get to a point where we could say that where we have talked with each other, everybody, and we will achieve a balance. Hopefully, this will happen during the course of this year. We have time for two more questions. Please go ahead with your questions. The next question is by Christoph Meyer by DPA. Please switch on your microphone. Good morning. I have two questions. One is quite simple about your yearly forecast. The headcount was on the previous year's level, and I expect that to remain like that. Back to the cost of the tariffs in your yearly forecast, you mentioned what costs to expect. I mean, with the updated forecast, how much of an effect will the tariffs have in total? Maybe you can tell us in particular what the effect of the U.S. tariffs will be. Thank you, Mr. Meyer. Mr. Mertl will answer your questions. Good morning, Mr. Meyer. Yes, I can confirm that as far as the headcount goes, we will stay on previous year's level for the whole world, and we will stay in that corridor. I cannot give you any precise figures right now. Of course, we can calculate based on our guidance, what we said in March. It is about one percentage point. It depends on what our negotiations will lead to. There will be a slight negative effect compared to March 12th. It is all within our guidance for our automotive section, but also for the group result. We will adhere to the figures mentioned in our guidance. The last question by Mr. Frank Volk from Automobilwoche. Please switch on your microphone. Good morning. I have two or two and a half questions. One more question about the U.S. figures. You mentioned the figures as of March, but you said that there were some what would you expect? Mr. Volk, could you speak up, you are hard to understand. Is it better now? Is it better now? You said something about 4% in March and that there were some. What are your expectations for the rest of the year? The second question, and that is a question about localization referring to Germany. You're stressing the flexibility of your production network and a large number of the vehicles which are being exported into the U.S. They're actually being produced in Dingolfing and Bavaria. What effect will that have on the production? What will the tariffs have? Does that mean adjustments in the production? These were two questions or two and a half questions. The next question would be a comment on what Mr. Zipse said. You had quite impressive figures for the U.S. as far as the investments go over the course of the years. The U.S. government knew about these figures, and they were never interested in that. Why are you so optimistic as far as your talks go that they will be more successful in the future? Okay, Mr. Volk, we will start with Mr. Mertl, and then the last part about the U.S. will be answered by Mr. Zipse. Good morning, Mr. Volk. As I said earlier, we expect growth in the United States. You should not overlook one thing. We are, unlike other OEMs as far as our footprint in the U.S. goes, we have advantages. We are producing and selling X3, X4 produced in Spartanburg, X5, X6, X7, X7. That is a main difference compared to some of our competitors. That is a clear advantage, and we will make use of that. Effects on other productions. Of course, we use our global production network worldwide. We're optimizing that, the flows of goods in the different regions, and we're mitigating tariff effects through that. Mr. Volk, of course, you are correct. The U.S. government knew about it beforehand. They are aware of that. In our discussions, we have stressed what it would mean if on a 100% if you had a 100% local-for-local system, that would have two effects. Of course, you could produce other vehicles in the U.S., which would increase the volume, but other vehicles could no longer be built in the U.S. because of the volume. It would not be worth it. In total, the overall volume would decrease in the U.S., and nobody wants to see that. That is something we're noticing. Why that is not at the heart of this discussion, that has to do with the fact that Mr. Mertl mentioned we're the only ones who have such a footprint. People do understand the whole situation quite well. Thank you, Mr. Mertl, Mr. Zipse. That was our phone conference for the first quarter. Thank you so much. Service from Munich.