Ladies and gentlemen, welcome back to our quarterly earnings call. Oliver Zipse and Walter Mertl are also back in the room with me. The line will be open shortly for your questions. The operator will give you some technical instructions now. Thank you. Ladies and gentlemen, we will now begin our Q&A session. If you have a question, we ask that you please use the raise hand function at the bottom of your Zoom screen. Or if you have dialed in, please press star nine to enter the queue. Once your name has been announced, you can ask your question. If you'd like to withdraw your question, please lower your hand using the raise hand function in the Zoom app or, via telephone, press star nine. Thank you, and please stay tuned for our first question. Our first question is from Patrick Hummel from UBS. Please unmute your line and ask your question. Okay. I hope you can hear me now. It's Patrick from UBS. Yes. Thank you for— Yes, we hear you, Patrick. Perfect. Thank you for taking my questions and of course since I'm the first questioner here, I'd like to thank Oliver and say, over the past 10 years I think you and your team had plenty of, you know, potential opportunities to take wrong decisions in a very volatile and rapidly evolving environment with a lot of surprises obviously. Probably that includes some potential distractions from the daily mood of financial markets which can flip to the extremes very quickly. You kept the ship on course, and I think the result today is BMW stands here as a very robust, as a very flexible company, and I think that is your legacy. Thank you very much for all the great dialogue and the challenges in our discussions over the last seven years, and all the best. Oliver, if I just may start with you. I think if I understood correctly, and the translation was maybe not exactly clear, you said in the media call earlier on that you expect the U.S. to look at export credits, which of course could be quite beneficiary to BMW. I'm wondering, is your optimism in this regard based on the discussions you have locally with governor on governor level let's say, or are there any signs also from Washington that this is the way forward? Because I think that's a pretty bold statement. We're not hearing that from anybody else, so I'm keen to understand better and also what it potentially means for your industrial footprint decisions, thinking here, and scenarios. My second question goes to Walter. Walter, you now chose a slightly more cautious wording on the China outlook and frankly to many in the financial community that didn't really come as a surprise. We've always been a bit more cautious than you've been. I'm just wondering, you know, you kept the guidance for the Group obviously unchanged. Is there any offset to the softer China view in your guide, or are we just gravitating towards the lower end? More specifically you also alluded to, you know, positive momentum building in the coming quarters in the media call. Can you just remind us, what the biggest EBIT drivers that would sequentially get better will be? Is it Neue Klasse volumes? Is it further cost downs or what else is it? Thank you. Good. Thank you very much, Walter. We start with Oliver. Good morning, Patrick, and thank you for your kind words. I always enjoyed discussing. If there's a little time lag between recognizing what is right and what we do, that's okay with us. To your questions. Export credits we try to explain on governmental level but also on governance level in the United States, the industrial logic why it's good for the United States. In our industry, the volumes per unit are too small to build every car in every country at the specific volumes. This sharing of volumes and distributing it around the world helps the United States and it helps Europe. If you don't do that, volumes will shrink and not grow. If you look at the United States, their main political movement is growth, and the second political movement is jobs in the United States. This export credit program helps the United States and Europe to do both, and we explained that logic and they followed us. It's not the question whether this is helpful for governments, it's more a matter how do I put it in, how do I execute it? For me, it's only a matter of execution and then it's a matter of timing. The most important ingredient is the first step in Brussels to implement the [EU Battery Regulation], and then we can do that second step. We are not the only company. There are other, in other industry, other competitors who also import us and export us at the same time. I think to put export on the focus is the net's next logical step in the United States, and therefore I think there's a very good chance to implement it. Thank you very much, Oliver. Walter, please. Hello, Patrick. Yeah, the [wording] w as also explicitly chosen in March already, as we discussed, and so it is now in Q1. I think we outperformed the market. We presented that one. Now, with respect to EBIT drivers in the Q2, Q3, Q4, there is, of course, A, space in corridors. B, we're still moving on with our cost measures, as usual with our programs. Don't forget that the R&D and the CapEx ratios are heading towards the strategic corridors, less than 5%. We mentioned that we're already in March. Just wanna underpin this topic. Of course, versus the actuals, our Neue Klasse is coming into place. Don't forget, in a lot of European countries, we have margin parity already, apple with apple compared. That, of course, contributes, too. I think there is still room for improvements. Thank you. Thank you very much. Okay. Thank you very much, Patrick Hummel. Next question, please. Thank you. Our next question is from José Asumendi from JP Morgan. Please unmute your line and ask your question. Good morning. José from JP Morgan. Oliver, my very best wishes for the years ahead. Congratulations on the work done setting the base for a very robust BMW. Thank you for all the collaboration the past years. Two questions, please. Oliver, you were at the Beijing Show. You met many of your competitors. Can you maybe share your overall impressions of how BMW is set up to compete in China? From your, you know, extensive discussions, was there anything that stood out for you in terms of partnership, collaboration, supplier competitiveness, et cetera? Were you think this could be an opportunity for the firm for the coming years? Question two, Walter. Also great to see you as well. Just maybe can you help us map a little bit the headwinds and tailwinds in terms of fixed costs, headwinds, and maybe cost opportunities, which you mentioned in your speech, and how that evolves in between Q2 and Q4 of this year? Thank you. Thank you very much. We start again with Oliver. José, when you, when you walked over the Beijing Auto Show and compared what the BMW Group was representing and what the rest of the show was representing by and large, there was a very focused presentation of most of the players in that industry. The majority was electric. The majority was the same segment of cars. Very few sedans, a lot of SAVs of larger size, focus on autonomous driving. It's all the same. It was almost a monoculture. Of course, markets worldwide, they are not monolithic. They are widespread. They are differentiated by drivetrains. They're differentiated by size. They are differentiated by price segments. Then you looked at the BMW Group stand, there was a large portion of MINI with all drivetrains available. Then you look at the BMW stand, you saw individualization. You saw all drivetrains. You saw V8s. You saw, of course, the Neue Klasse fully electric. You saw smaller cars. You saw the new 7 Series. You saw our focus on hydrogen. The full breadth of a premium player, you saw that, and that differentiates BMW. The variety which represents the variety of market segments. You don't have to look on a global scale. You see that in China as well. The markets are much more wider than you would see on that fair. That is a worrying thing if the whole industry thinks they can concentrate only on one segment, larger cars, SAVs, electric, then something is wrong. On the other hand, this makes us more resilient, and have round cells to offer the whole breadth. Let's just look at the first three months. EV sales in China were plummeting. Not only decreasing, they were plummeting. What happened? Our ICE sales went up at the same minute. Especially China shows what it means to be a full segmenter, to be technology open, and at the end, also to be a global industry. That was proof that our strategy is right. Thank you very much, Walter. Thank you very much, Oliver. Now, Walter. Hello, José. The headwinds we had in Q1 year-on-year, I think I mentioned majority is about exchange rate and commodities headwind, which we mentioned already in Q3 last year and also in March. The majority will be in the first half year of an impact of a high EUR 3 million digit number. You saw already the first EUR 400 million, roughly EUR 400 million. You will also see an impact in this direction in Q2, then slowing down in Q3, Q4. That is clear, based on the exchange rate development you saw last year already, lasting now this year in the first half year. With respect to the tariffs, now, of course, Q1, there was not the extra U.S. tariff happening, so that was the hit now. If you remember rightly, Q2 to Q4, we had higher numbers on the tariff burden than now in Q1, which is 1.25%. It was 2.75 levels. We are assuming, as you saw in our guidance, of 1.25% burden. That is less than full year burden of 1.5% last year. That should be rather positive. Not to forget, on the R&D side, I also mentioned expenses have been down by 12%, while depreciation has been up, as well as our capitalization ratio came down from 34% to 31%, which we also announced already in March. That is, of course, also on my IFRS burden. We compensated that in Q1. We are still moving on, having, of course, more depreciation to come with every new start of production. That will be going forward, this discussion. With respect to tailwind, as we mentioned, 60% more order income on BEVs, especially with the iX3, which is high order income levels. That will be positive in the quarters to come whenever we deliver these cars. These are not pre-orders. These have been orders booked and in some cases already with some money on top of that. That is positive. With respect to this, as you know, we are not giving quarterly guidance. With that in mind, we confirmed the guidance we have given in March. Thank you. José. Thank you very much, José. Next question, please. Thank you. Our next question is from Tim Rokossa from Deutsche Bank. Please unmute your line and ask your question. Thank you very much, Max, Oliver, and Walter. Before I come to my questions, a lot of people on the call here asked me to say a few words to you, Oliver, other than just thank you, and I think I obviously very, very happily do that. During the last earnings call, you said, "Tim, I can't remember a single call without you. It almost feels like you're part of the BMW inventory by now." Obviously, I had to smile, and I thought that I'm hopefully the good type of inventory, the Neue Klasse one, and not something that sits for too long on your lot. If we leave those jokes aside, I think that line captures pretty well something that's very real, the consistency and the trust that we now built over so many years. Clearly, no one can say that you didn't pick a very interesting time to be the CEO of BMW. You've been on a very, very long journey with us together. We had COVID. We had the semi crisis. We had a big industry transformation. We have China. We have tariffs. Now you leave with the Neue Klasse. Throughout all of this, we had big strategic debates. It's fair to say that we didn't always agree on everything. There were plenty of tough questions from all of us. You were always very direct, was always very constructive and very respectful. By the way, I can also only return this about always being present. It's absolutely not a given for a CEO to be on every single earnings call quarter after quarter, showing up, engaging, taking the questions head on, and you did that very consistently, and that really sets an industry standard, Oliver. You generally always looked very actively for this dialogue. At the very beginning of your time as CEO, you invited me to your headquarters. You showed me around. Back then, it was still with Nicola. We already debated the very big themes. I also remember this VDA Automotive Supplier conference two years ago, where we were on stage back to back. That captures something that is very consistent throughout your role as CEO. You always sought the dialogue with all sorts of stakeholders, not only when there was a concrete discussion on the table that had to be clarified, but also on the bigger questions, the strategic vision for the sector, the direction of this industry that is so enormously important for Germany and Europe. What really set you apart on all of these discussions, Oliver, that's pretty clear, is you never felt like you had to swim the mainstream. You focused always on what you believed was right, and you did have the conviction to stick with this. A very concrete example that I obviously remember from a capital market perspective is especially dedicated EV architecture. Many of us, including myself also for a while, argued that that is inevitable. You were very clear that you saw that differently, and the slogan, "Flexibility is key," pretty much became associated with you among all of us. It was for you about protecting options, adapting customers, not really telling them what they are supposed to do, but giving them what they want to buy. On behalf of the entire investor community, therefore, I would really like to thank you, Oliver, for this great discussion that we had over so many years, and we obviously wish you all the very best for whatever comes next. Thank you. Then I have two questions. The first one is— Can I— Probably— Wait, wait, Tim. Yeah, of course. Tim, can I respond shortly? You are one of the few, but there are some more who are still on the calls in the last seven years and you've been around for more than a decade, I think. What you just said is very interesting because you are a follower of this industry, this complete developments, architecture, technologies, players, new players, old players. That is very interesting that someone who has been observing the industry tries to summarize what's happening in this industry. That's got quite interesting because normally you only look at the quarterly thing. I would like to thank you for following us and learning together. We had to sharpen our arguments to withstand your questions, so this was also very helpful for us, a good learning experience. I would like to return the thank you. That was superbly interesting, not only in the calls, but also when you were visiting us, when we were discussing outside of the official events. Thank you for your support and your understanding. Now you can ask your questions. Tim? Hello? Yeah. Sorry, the host had muted me again. Thank you very much for that, Oliver. Okay, coming— I have two— —coming back to you. There's too much thank you. Yeah, yeah, exactly. I Thank you, Max. I have two questions. Oliver, the first one is for you. Now that you leave the seat, you hand it over, you accomplished a lot of things. Out of all the issues that this industry is still battling with, which one do you think from a capital market perspective we should really focus on and really worry about? And which one is perhaps really overdone and overplayed? Secondly, Walter, to you, a bit in the direction that some of my fellow peers were already trying to get to. I know you don't guide on a quarter. Look, we have no Chinese New Year in Q2. You might book the [IPCEI] refund. We have more selling days in general. Is it fair to arrive at the conclusion that Q2 should generally be stronger than Q1, bar any major external events? Thank you. Thank you very much, Tim. We start with Oliver and then Walter. Oliver, please. Thank you for the question. If you would look in the years of five years from now, in the year 2035, you would look back. I still think there's too much focus from the media, but also from the capital markets on individual players, individual technologies, singular events. In five years' times, the players who will still survive, they have the competence to system integrate to bring all technologies into a car. Who build cars who have a long-term quality, who are not falling apart after one or two years, who are still a service after five years. It's a completely different game which is happening there. Who are able to differentiate between a singular hype and an overall business model. If you watch the industry today, actually there are too much bets going on. Too much bets on a singular technology that might happen. This cannot be endured. Much money is lost in this industry on bets. A system integrator, system integrators, who are able to follow regulation and at the end have still a business model on high quality products, that's the key of everything. In five years from now, to follow CO2 regulations specifically and remain a profitable business will be more or less the key to everything. Thank you very much, Oliver. Walter, please. Hello, Tim. I'm not guiding quarters, just for years. Of course, you have been absolutely right. There should be a potential once we finally clarified everything with the custom authorities that we book the [IPCEI]. Otherwise, of course not. The impact is, as we stated in March, not the biggest one. Tariffs was higher in Q2 last year. That's also fact. Who knows what's going on, right? We have a clear understanding what we expect, as we described in our guidance already. Don't forget the seasonality, of course. Usually, we have higher fixed costs in after Q1, so that's the ordinary bit. Don't overstress this, of course, we are working on, as you know us, we execute. Thank you, Tim. Thank you very much. Thank you very much, Tim. Next question, please. Thank you. Our next question is from Stephen Reitman from Bernstein. Please unmute your line and ask your question. Stephen, please press star six to unmute your line. We'll go to our next question from Philippe Houchois— Good morning. Good morning. Good morning. —from Jefferies. Morning? Stephen, please go ahead. Stephen Reitman. Stephen, we hear you. Yes. Yes. We hear you, Stephen. Thank you. Okay. Technology worked finally. Go ahead. Thank you very much. Thank you very much. Also, again, also wanna add also just to wish all the best to Oliver. Again, you know, I've got a even longer perspective on BMW than even Tim. BMW's always stand for integrity, which I think has been very much we've seen under Oliver Zipse under your, on your stewardship. I think in particular, one other element that was not discussed was during the whole crisis the German auto industry faced in 2015 with Dieselgate and beyond, how well BMW actually fared in all of that with actually really avoiding that with the, basically with the, you know, that actually had technology that actually was completely compliant. I think shows something about the BMW and what goes on in this company. Onto my questions. I think particularly as you leave the company, with the Neue Klasse now really on its big rollout phase, just to sort of what's your assessment or what is the assessment you're finding from your Chinese dealers and what you're hearing as well about how they feel about Neue Klasse in the China market? We've seen obviously, you know, we know that BMW still stands for quality. It's a very aspirational brand, but until now, obviously the problem for legacy car makers has been not being able to keep pace with some of the technology changes that have come from the Chinese brands. How is the feeling now to which extent that Neue Klasse has bridged that gap and is the missing part of the puzzle? Thank you. Thank you very much. Walter, please. Hello, Stephen. We also had in China a brand summit and a brand night together with the dealers, and that was received very, very well, especially that they see and feel that we're on eye level with Chinese OEM locally, and that's the positive outlook. They have been also already very, very positively surprised about the 3 Series, which we also presented in China. That makes everything positive. Not to forget that we helped the dealer network in performing better. That is more or less finished. Our dealer right-sizing exercise, of course, this is moving on always. All these things together, how you treat the dealer network, how we organize ourself, plus the products to come, is a positive spirit on their side, what we feel. That makes it positive for us. Thank you. Thank you very much. Stephen, next question, please. Thank you. Our next question is from Philippe Houchois from Jefferies. Please unmute your line and ask your question. Yes, good morning, and thank you very much. Of course, Oliver, thank you very much for your leadership and your availability over the years. I've got two questions. The first one is, I think you've been, as a Group, very steadfast in saying 8%-10% margin long term. Those targets were given at a time when China was an excess profit market. There were no tariffs. I guess I'm just trying to understand what new levers you've been able to identify to actually compensate for that and stick to that 8%-10% margin corridor. Specifically, I think at some point there was a discussion that Neue Klasse production might lead to 10%-15% production cost per unit. I'm just wondering if that's what you already observe in Debrecen, where you've started producing the Neue Klasse. My second question's on this FCA provision that you've taken up on the U.K. I think at some point, Walter, you may have mentioned that you thought the basis of that investigation a bit flawed, and that you would fight it. At the same time today, you're giving in. You still think that there's a roadmap where this is the wrong investigation, when we'll be potentially see a reversal in that provision? Thank you very much. Thank you very much, Philippe. Walter? Hello, Philippe. Well, the 8%-10% is not unreachable. Don't forget that it is three times 1 EBIT point we have to achieve. One is on the performance side. We love our BMW ecosystem. We can do even better. Not to forget ALPINA to come, which is also positive for the contribution side. Not to forget that the Gen6 Neue Klasse has a much better contribution margin than the Gen5, as we all know for a while. That's the performance 1 EBIT point. Second one is, of course, we are doing our homework, working on the material cost side, on the manufacturing cost side, on the warranty cost side. If you have a better quality, you have to provision less warranty cost, which is also contributable to the EBIT margin. Not to forget, of course, also logistic cost, et cetera, to be optimized with our global footprint. That's the second EBIT point. The third EBIT point is also homework, is our fixed cost levels, which we are also going, coming down, as we mentioned already, step by step in 2026 and 2027 and also in 2028. Not to forget one choker, I would call it, which we never forget to mention. This is the PPA, purchase price allocation depreciation, which is always accounting for 1.1, 1.2 EBIT points. This is only lasting until mid-2028, you will have already a half-year effect in 2028 and a full effect in 2029. With these elements to come, there is a chance to come back to 8%-10%. Of course, we are not naive. There is always something coming around the next corner, whether there are tariffs or other crisis points, and we mitigate as they come along. We have plans already to do so. I think that for your first questions. The production cost comes along with it, right? We use new technique and the latest procedures, and of course, that is also contributing too. Now, your second question on the FCA provision. You hit a nerve on that side, on my side, honestly. We, and I personally, had intense work together with this authority, with FCA. We did a lot of really many amendment proposals we made between October, the draft version, and our submission then in December. We contributed to, in my eyes, positively to come to an proper and proportionate solution for all parties. I'm really disappointed that this was not reflected. Some bits and bobs have been reflected, but hardly anything, and that is really disappointing. I continue to regard the scheme as unfair and disproportionate. Whilst there are legal grounds for challenge, I have to say without the participation of a meaningful cohort of other U.K. lenders, especially all banks, and I have also an understanding about their situation, such an undertaking by the Group of BMW would not be in the best interest of its shareholders, I think. Particularly considering the level of ongoing uncertainty pursuing a legal challenge would create. I think we have to consider that, and that's the reason why we're not challenging it. Because we can't do that without the banks and without more than just ourself. That is my position on FCA. Thank you. Thank you, Philippe. Next question, please. Thank you. Our next question is from Stuart Pearson from Oxcap Analytics. Please unmute your line and ask your question. Good morning. Thank you for taking my question. One detailed one-on-one just on China. Just maybe for Walter on the bridge, the other EUR +400 million. I just wonder if you can just show a little bit more color what the moving parts were in there, in particular. I think you mentioned warranties being a tailwind there, but I can see obviously there's an outflow there, I guess, adjusting for that on the cash flow side. Just wonder what's going on warranties, whether that is I heard you mention it on the longer term outlook as well, whether that's a source of potential tailwinds that can continue in the next couple of years. Generally, it's been a headwind for the industry, just wonder what's going on there. Then the second question, I mean, going back to China, Oliver, gonna hear what you're saying in terms of the breadth of product offer that BMW has in China. In some ways, I guess, having to maintain that breadth of product range for the global market might be costing BMW and the European peers in China, and that it's not been focused on the pure EV segment. I just wonder if particularly you mentioned those large SUVs that dominated in China, the Chinese moving to the premium segment, and I guess that is gonna be a monumental challenge for a segment where, you know, it probably is a disproportionate part of your profitability in China. How confident are you, I guess, of the X5 and above that footprint in China in the next couple of years as we see the Chinese move into that, and of course Mercedes localizes the GLE as well? Thank you. Okay. Thank you very much, Stuart. Walter, please. Hello, Stuart. Let's start with the first question to my bridge on other positions of this EUR 400 million. My manufacturing cost side is a low three-digit positive element. My warranty side is also a low three-digit positive element. Don't forget, we didn't have to add any extra provisions for than previous years maybe. Of course, the tariff burden is also in this other section, and we had last year only EU China burden with our MINI electric cars, but nothing on the U.S. side, whilst now I'm having it. Now I'm experiencing one and a quarter hit, whilst last year was lower. This is the negative position on it. With respect to the Neue Klasse in China, coming to your next question and the footprint, we are bringing this confidently into the market. As I mentioned beforehand, we had this Brand Summit and the Brand Night. The spirit of the dealers is very positive. They see our tech levels coming with the Neue Klasse on eye level, the product is on the point. With respect to the, your question on the X5 footprint, if you have a look even now in Q1, we sold more X5s with a better transaction price this year than in Q1 2025, not to forget. We did a lot of product enhancements, but also could achieve a better transaction price level. Now, also a new X5 is coming in China in 2027. That one we have presented already to the dealers, the dealer network. And they also confirmed this is on the point because it also has all techniques of the Neue Klasse, also the momentum stack. Not to forget, different than others, we also provide the X5 with all powertrains in China. We have the offer which is relevant and all the other ones, I don't think that we just have to compare ourselves as you ask for GLE. It's about all Chinese OEMs, and I think we don't have to hide for. That's also what we got as a feedback from all dealers, and that makes me confidently looking into the future also for China. Thank you very much, Stuart. The next question, please. Thank you. Our next question is from Horst Schneider from Bank of America. Please unmute your line and ask your question. Yes, thank you. Thanks for taking my questions. It's Horst here. I have got a few left. The first one is related to your volume price mix line in Q1. We have seen BEV sales -20% in Q1. I could have mentioned that triggered positive mix, while it seems that the price turned down quite a bit in Q1. Is that now a general trend, that the pricing gets tougher in the premium market? What happens if the BEV sales start to increase again with the ramp-up of the Neue Klasse? I know there are a lot of moving parts because, as you said, you also launched the ALPINA, and you launched the X5, and there are a lot of new models coming in H2 which compensate maybe higher BEV mix. What should we think about this equation, price versus product mix going forward? Then a follow-up to this midterm target question from Philippe, a question that I also always ask myself. I think a general problem in the premium market is that the volumes do not really grow anymore for the established players. You do well. You take even market share by having flat sales, but nevertheless, the top line is not growing. Therefore, my question is, if you want to achieve these midterm targets, this requires the assumption that the volume growth picks up again and that the price mix impact gets less negative than it is right now. That's question number two. The last small question that I have is, when we look at the high oil price in Europe, we see this BEV increase, which might be related to that. In the U.S., it seems we do not have any impact. Beyond BEVs, you see in the U.S. already that we have got a higher PHEV demand or that the people switch from large engines to small engines. What's the role of fuel efficiency in the purchase, in the purchase decision? Thank you. Good. Thank you very much, Horst Schneider. The question will be answered by Oliver. Thank you, Horst, for your question. I would like to have a twofold answer. The first one is very concrete. If you look a little bit deeper on our BEV global sales, two things happen at the same time. They're going down in the United States. and China quite rapidly, but they're almost fully compensated by higher ICE sales. Europe is exactly the other way, you know? They're going up, they're above previous year level, that is even before the ramp-up of the Neue Klasse. We have to look a little bit deeper. It's all happening exactly at the same time. In China, it's mainly caused by the reduction of the subsidies for BEV cars. That puts also a different view on what is happening in China, because only roughly 30% of the whole market is BEV. The rest is NEVs. It's not BEVs. It's cars with plug-in hybrids, it's cars with range extenders, and that will be a continuing trend. What worries us, that Europe thinks they can overhaul or accelerate on the BEV sales while China is putting the brakes on it. That is a question mark where we think. Of course, our strategy to be flexible on the technology will help us there. More on a strategic side, what is premium in the future? Premium of the future is product quality, specifically long-term product quality. It does not make sense to push cars in the market who lose their resale value after two or three years' time. There is no this is not premium. It's not feature count in a new car. What is the residual value after one, two, three or even five years? I'm not even talking about historic cars of 15 or 20 years. That is premium. The second thing is premium system integration. It's not feature count. We discussed what we saw in Beijing again, feature count over feature count. That's not the point. How does that all play together? How does it fit? Is it for someone who drives the car, not while it's standing, but while it's driving, does it fulfill the function they're supposed to? The third one is safety. I think that becomes one of the foremost criteria for premium of the future. Safety. No casualties, no risks. Absolute promises to a brand who promises to be premium means no casualties, no risk in driving the car. I think that will define premium of the future, I think we're well underway to fulfill that promise. Thank you. Thank you very much, Horst. Next question, please. Thank you. Our next question is from Christian Frenes from Goldman Sachs. Please unmute your line and ask your question. Yes. Hello, everyone. Oliver, I'd like to also extend my congratulations and best wishes for your tenure. I think the decision-making has been superb with hindsight, and your focus on flexibility as well as profitability has been appreciated by everyone. I have two questions. First of all, maybe zooming in on China, specifically the Neue Klasse ramp. My question would be, how are you thinking about pricing for the Neue Klasse in China? If you know, to what extent can you comment on that, and also when do you anticipate setting that? My second question is just on the FinCo. Just I noticed the penetration rate jumped to 51.6% from 43%. I'm just wondering if, Walter, if you could give us some more color on maybe geographically some of the dynamics we're seeing there that have caused that. Thank you. Thank you very much, Christian. Walter, please. Hello, Christian. Well, on the Neue Klasse ramp-up, I think you know that we are going to start the iX3 in Q4. Then in 2027, we are going to move on with the 3 Series, et cetera, as we mentioned also in February. The pricing will be always determined just before the start of sales, not when we present things. I think that is most relevant as we all are aware of the market dynamics in China. We will let you know, and believe me, we do know what we wanna do. On the FinCo side, the penetration ratio uplift, of course, we shouldn't forget about that in the first half year, China had hardly any penetration ratio because of these commissions paid by other banks. End of June, as we remember, the commission structure has changed as the party has reminded some banks, and hence the commissions came down to the right level, which we also always fought for. With that, our penetration ratio in the second half year of 2025 elevated, and now we are just running on the same level again. That in combination ends up with this 51% in Q1. The young used car is also included in our new cars, not to forget. You find a note also that we changed this definition because young used cars in our side is also classified as new. It is not an effect on the total business because it was always a total business, whether we have new, young used cars or used cars, BMWs, MINIs, et cetera. That is included always. It's just about the percentage ratio, and that is accounting for 2.5% to 3% more or less that level. Thank you very much, Walter. Coming to our last question, please. Thank you. Our final question is from Henning Cosman from Barclays. Please unmute your line and ask your question. Yes. Thank you very much for taking the question. A couple of clarifications and maybe one first to Walter again on this other cost savings. Thanks for telling us already what was in the Q1. I'm a little bit more interested in what that's gonna look like going forward. I appreciate you don't want to guide on quarters, but if you could perhaps say if we're talking about EUR 1 billion or so in cost savings for the year as a whole. You obviously had an excess of EUR 2 billion last year, and it's quite a big swing factor. What would be great to understand what sort of ballpark you're managing towards for the full year. To the clarifications, can I just clarify that, you know, Oliver, really interesting, your comments about the offset mechanism with respect to U.S. tariffs. Can I just clarify that that's not included in your unchanged 125 basis points of full year tariff assumption? Finally, Walter, I think, you know, the all your statements sound really constructive. Could I perhaps get you to say that, if I paraphrase and put this all together, you're kind of telling us that you're going to be in the top half of the automotive EBIT margin guidance range for the full year. Thank you very much. Oliver, all the best. Thank you very much. The question will be answered fully by Walter. Hello, Henning. With respect to other costs, I am clearly not giving quarterly definitions, and we always have to have in mind the year-on-year position. We clearly stated already in March that we still move on on the cost-saving side on all the elements you can see, and you see that nominal in my reports, and you will also see that going forward. I am not giving you any indication about the amount. With respect to your tariff question, offset mechanism is not included in my one and a quarter, clearly not. With respect of your direction of my corridor, I think a corridor is still a corridor, and that is between 4% and 6%. We concluded that quarter one was 5.0%, and all the rest is to come. We confirmed our guidance of 4%-6%. I think there is nothing more to say. Thank you, Henning. Thank you very much for your last words. Ladies and gentlemen, thank you very much. Thank you for joining us. Bye-bye, and service from Munich.