BERLIN – BMW forecast robust fourth quarter gross sales on Friday and stated its order e book was stuffed into the primary few months of subsequent 12 months, with executives including they noticed no want to chop costs as some rival automakers have.
Automobile availability was enhancing as provide chain bottlenecks eased, although greater materials and logistics prices continued, notably for labour, the German group stated.
Shares have been up 3.3% at 1035 GMT, with third-quarter outcomes largely consistent with expectations and delivered in a extra optimistic tone than some rivals, which warned of a subdued market setting curbing demand.
Pressed on whether or not BMW felt the necessity to minimize costs to spice up electrical automobile demand, notably in China the place a battle for market share has raged this 12 months, Chief Govt Oliver Zipse stated this strategy was not in BMW’s playbook.
“We’ve no real interest in sinking costs to achieve market share. That is not our technique. And as you may see, we’re managing to develop considerably even with very acceptable costs,” he stated.
The premium carmaker has forecast an annual margin on earnings earlier than curiosity and taxes (EBIT) in its automobiles division of 9.0%-10.5% and is heading in the right direction to hit that focus on with a ten.3% margin thus far this 12 months, it stated.
Increased-priced and totally electrical automobiles boosted quarterly revenues above expectations of eight analysts polled by LSEG to 38.5 billion euros ($40.92 billion), however group internet revenue fell 7.7% after final 12 months’s determine benefited from a one-off enhance when BMW took majority management of its Chinese language three way partnership.
The corporate noticed some slight aid in uncooked materials costs within the quarter versus final 12 months however nonetheless felt an influence of 200 million euros from the web steadiness of foreign money and uncooked materials positions, Chief Monetary Officer Walter Mertl stated.
Supplies and logistics prices stay excessive, with a notable damaging influence throughout the primary 9 months of 2023 because of elements together with excessive labour prices from companions, he added.
In an announcement, BMW made no point out of excessive rates of interest or inflation weighing on progress, in distinction to rivals comparable to Mercedes-Benz and Porsche.
Absolutely electrical gross sales hit 15.1% of whole gross sales within the third quarter, outstripping BMW’s end-year goal of 15%. Fashions from the higher worth section, just like the 7 Collection, the up to date BMW X7, and the BMW X5 and BMW X6 fashions, are additionally driving gross sales progress.
Free money circulation for the automotive enterprise thus far this 12 months got here in at 5.7 billion euros, close to the full-year forecast of 6 billion.
($1 = 0.9409 euros)
(Reporting by Victoria Waldersee, Christina Amann; Modifying by Elaine Hardcastle and Mark Potter)
