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Driving BMW

BMW Chairman Bernd Pischetsrieder is aggressively turning the German automaker into a world player.
Paul A. Eisenstein
From the Print Edition:
Danny DeVito, Winter 96

There's something about the goatee. And the coal-fire eyes. The cigar and the thick Bavarian accent couldn't have offered much cover, either. But there was Bernd Pischetsrieder and his trusty sidekick and nuclear physicist Helmut Panke, tooling through the Deep South in a rented minivan. No dueling banjos for these good old boys. Just a contract worth a half billion dollars. Maybe more.

It was "Get Smart," rather than "Mission Impossible." It began back in 1992, when BMW's young, soon-to-be-chairman decided on a fateful step that would forever alter his company. Fed up with the ever-rising demands of German unions and determined to transform an essentially regional carmaker into a truly global player, Pischetsrieder was intent on opening Bayerische Motoren Werke A.G.'s first full-scale foreign assembly plant. As its number one overseas market, the United States was the logical location. And in the battle for foreign "transplant" assembly lines, Southern politicians were falling all over each other to offer bigger and better tax breaks and land deals. But Pischetsrieder knew it would take more than money. He had to avoid a clash of cultures. So, Pischetsrieder led a top-secret team on a mission to the birthplace of the Confederacy. Pischet and Panic, they took as their noms de plume. "We had to take names we could stick with," says the 48-year-old Pischetsrieder, eyes twinkling at the image of himself going "undercover."

With a map of potential plant sites to guide them, the team rolled through backwoods villages and fast-growing cities, comparing living conditions, checking transportation routes and making notes on the occasional bratwurst house. Back in Germany, they crunched their numbers, checked their guts and threw a dart at the map that landed just outside Spartanburg, South Carolina. In November 1994, BMW's new plant went into operation. Today, it is the automaker's only source for the much-in-demand Z3 roadster.

Pischetsrieder's penchant for planning is matched, perhaps, only by his need for secrecy. Maybe it's a talent developed innately growing up at ground zero in the Cold War. At times, he runs his company like a spy ring from a LeCarre novel. Consider this Baby Boom visionary's other big coup, the stunningly unexpected acquisition in 1994 of Britain's last independent automaker, the Rover Group.

"He divided the company up into cells," recalls Panke, trained in nuclear engineering, later BMW's head of strategic planning and now in charge of its North American operations. Pischetsrieder was the only man at BMW who totally knew the company's intentions. "That way, no one knew too much," Panke says. Certainly not the press. There wasn't a single rumor. Nor did anyone suspect a thing at Honda, the Japanese company that thought it had formed a limited partnership with Rover. Pischetsrieder notified Honda's chairman personally, just as the deal was completed snatching Rover away.

This fall, Pischetsrieder pulled off another coup in virtual secrecy when BMW and Chrysler Corp. announced plans for a $500 million joint venture to build 400,000 four-cylinder engines a year in South America. If the deal goes through, as expected, Rover stands to become more competitive in the small-car market.

Who is this brash young man so intent on reshaping not just his own company, but the auto industry as a whole? By conventional terms, Bernd Pischetsrieder wouldn't qualify to run a German company. There is, after all, no "Herr Doctor" at the beginning of his business card. No advanced degree in engineering. Not even an MBA. But to listen to the growing legion of fans and admirers, Pischetsrieder is proving himself the most qualified executive in Germany.

"Unexpected, unconventional, brilliant," is how Automobile Industries described Pischetsrieder, the magazine's 1995 Man of the Year. Indeed, "brilliant" is a word one hears over and over again when you seek a thumbnail description. Pischetsrieder is, after all, someone who'll curl up after a long day at the office to read philosophy in the original Greek or Latin. But if it's winter in the Bavarian Alps, he's just as likely to be found on a snowboard, racing down the slopes with the same, sometimes reckless, abandon he can show behind the wheel.

He is a man not without contradictions, an insular Bavarian with a decidedly world view. A man whose company espouses the ultimate in individual mobility, even as Pischetsrieder personally presses for the development of automated highways and robotic cars. About five years ago as head of manufacturing, he declined to let BMW participate in a groundbreaking study of the auto industry by the Massachusetts Institute of Technology. "We already know what they've learned," he said of the results, published in book form as The Machine That Changed The World. Minutes later, confronted by nearly 100 copies of the book stocked on the coffee table outside his office, a nonplussed Pischetsrieder explained simply, "Good Christmas presents for my staff." Now, some years later, Pischetsrieder is relaxing in one of the three dining rooms at BMW headquarters, a cluster of silver towers that dominate the Munich skyline and cast shadows across the fields and stadiums left from the city's ill-fated 1972 Olympic Games. He is deboning a small fish, a process he delves into with the same relish and precision as a big business deal.

Pischetsrieder's liquid eyes are impossibly dark, blazing with wit and whimsy. His posture is ramrod straight. His refined manners speak of old-money upbringing. The auto industry, Pischetsrieder confides, was the last place he ever imagined himself working. Instead, he thought himself an entrepreneur in the making. But there were some automotive connections in the family, most notably his uncle, Alex Issigonis, designer of the legendary Austin Mini, a car so compact it could nearly fit into the trunk of a BMW 750i. The half-Greek Issigonis hails from one branch of this multinational clan. Pischetsrieder's own dark, Arabian good looks come from his mother's roots in a region of what is now Turkey, a place the family hurriedly fled from after the First World War.

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