Friday, 03 November 2023, 15:24
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Bayerische Motoren Werke AG (BMW) reported on Friday a higher-than-expected profit margin in the automotive division and confirmed the annual forecasts, with a more optimistic tone than that of its competitors, DPA and Reuters report.
The German luxury carmaker expects a profit margin in the auto division of 9% – 10.5% in 2023, and so far this year it has posted a margin of 10.3%.
Increased demand for electric vehicles and more expensive models led to a better-than-expected rise in revenue in the third quarter of 2023 to 38.5 billion euros, but group net profit fell 7.7% to 2.93 billion euros, after last year’s results were influenced by BMW taking control of its joint venture in China.
Financial director Walter Mertl warned that logistics and raw material costs remain high, which negatively affects the company’s results.
The BMW press release does not refer to the effects of high inflation or interest rate hikes on car demand, unlike competitors Mercedes-Benz and Porschewho warned that the difficult situation on the market affects demand.
In the first nine months of this year, the sales of the BMW group increased by 5.1%.
In the third quarter of 2023, sales of all-electric vehicles accounted for 15.1% of total sales, while BMW expected all-electric cars to account for 15% of total sales by the end of the year. Also, the success of the more expensive models – BMW X7, BMW X5 and BMW X6 – stimulated sales growth.
In the third quarter of 2023, operating profit increased by 18.2%, to 4.35 billion euros, exceeding analysts’ estimates. The profit margin in the automotive division increased by almost one percentage point, to 9.8%.
Recently, the German luxury carmaker announced that it wants to keep prices stable in 2023, after passing on some of the higher costs to customers in the past two years, but recently the chief financial officer Nicolas Peter warned that some moderate price increases are expected.
2023-11-03 13:26:20
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