Revenues for BMW Financial Services (FS) rose 7.3% over the course of 2017, reaching €27.5bn (£24.5bn).

The contract portfolio expanded 5.2%, reaching 5.3m contracts. Pre-tax profits increased by 2% to €2.2bn.

In the wider BMW Group, sales grew 4.1% to 2.4m units. Sales for electrified vehicles, while still a small portion of total deliveries, jumped 65% to 103,000 units, which the group attributed to demand for the battery-powered i3 model. BMW said it aims to increase electrified vehicles sales to 140,000 units in 2018.

Group revenues rose 4.8% to €98.6bn in 2017, pushing profits to €10bn. In Europe, sales were stable at 1.1m units, rising noticeably in France and Italy but falling by 4.2% in the UK/

The group’s research and development (R&D) expenditure rose by 18.3%, accounting for €6.1bn. BMW said this expenditure would rise by the hundreds of millions in 2018.

Additionally, BMW highlighted a substantial expansion in workforce, which it attributed mainly to electrification and autonomous driving development, with financial services and mobility also playing a role.

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By GlobalData

Harald Krüger, BMW chairman, said:  “We can look back on the most successful year in our corporate history and have achieved record levels for revenues and earnings for the eighth year in succession.  Since 2016, we have taken numerous strategic decisions to further grow our business on a sustainable basis in the years ahead.”

“This year we are targeting another new sales record, with deliveries slightly up on the previous year.”

UK internal innovation lab finalists selected

In related news, BMW UK selected the finalists for its internal “Intrapreneur Innovation Lab” programme.

Eight finalists were chosen from a shortlist of 74 proposals from internal teams. The 23 members of staff behind the finalist proposals will now work on developing projects within AI, car sharing, subscription-based mobility and the electric vehicle ecosystem.

After the innovation lab’s conclusion, finalists will be giving investment pitches to the BMW Group’s senior leadership.

Mike Dennett, chief executive at BMW UK’s financial services division, said: “The auto industry is undergoing fast change and innovation. To date, this innovation has mostly been limited to the vehicle and driving experience. We need to go beyond the vehicle to deliver the best services for the driver now and in the future. We need to explore how customers will access vehicles in 20 years’ time and act now.”

“The answers to many of these challenges can be found within our business. Our staff represent an untapped pool of ideas. The purpose of this innovation programme alongside creating solutions that benefit customers and our own bottom line, is to break down the siloes that can develop in global businesses to create a culture of collaboration and innovation. This initiative will leave a legacy of intrapreneurial thinking across our businesses”.