BMW warns that pre-tax profit, revenues and margin will be down

Time 3 years ago

BMW Group has revised its financial expectations for the current financial year – forecasting a lower pre-tax profit and revenues.

Citing its early implementation of the new WLTP regulations requirements as a main factor in the adjustment, it also said that earnings before interest and tax were expected to be ‘at least seven per cent’ – down from 2017’s 8.9 per cent and missing the eight to 10 per cent figure for the first time in eight years.

In its statement, it said: ‘BMW Group implemented the requirements of the WLTP regulations early. The industry-wide shift to the new WLTP test cycle has, however, led to significant supply distortions in several European markets and an unexpected intense competition.

The latest issue of Car Dealer Magazine is out now!

Harald Krüger

‘Thanks to its flexible production and sales strategy, the BMW Group is responding to this increased competition and is reducing its volume planning to focus on earnings quality.’

International trade conflicts were also blamed for causing uncertainty and pricing pressure in several markets.

Harald Krüger, BMW AG board of management chairman, sought to give reassurance though, saying: ‘The BMW Group remains fully committed to its goal of leading the transformation of the industry.’

In its statement, BMW added that it always expected 2018 to be a challenging year ‘due in part to additional upfront investments of around one billion euros for future mobility’.

The announcement follows German automotive giant Daimler also aligning expectations for its profits in June this year.

MORE: No-deal Brexit cannot be an option for UK automotive industry, warns the SMMT

MORE: European Commission launches probe over emissions ‘collusion’

MORE: BMW schedules Mini plant’s annual maintenance work for straight after Brexit

Rebecca Chaplin's avatar

Rebecca has been a motoring and business journalist since 2014, previously writing and presenting for titles such as the Press Association, Auto Express and Car Buyer. She has worked in many roles for Car Dealer Magazine’s publisher Blackball Media including head of editorial.

More stories...

Server 51