BMW’s automotive margin beats estimates as EV sales rise
BMW’s automotive operating margin exceeded expectations, boosted by sales of fully electric vehicles even as demand in China weakens.
The German manufacturer posted a margin of 9.8 per cent in the third quarter for its luxury car business, the company said on Friday (Nov 3). Analysts estimated it would reach 9.63 per cent, according to data compiled by Bloomberg.
BMW’s results offer a potential bright spot for Germany’s car industry, which is feeling the pressure of higher interest rates, weakening demand and persistent inflation. Mercedes-Benz Group reported last week a drop in margins, while Volkswagen said it is speeding up cost-saving efforts.
BMW saw sales of premium vehicles rise 5.8 per cent to 621,699 in the third quarter from the year before. The percentage of sales made up by fully electric cars rose to 15.1 per cent, the company said. BMW confirmed its guidance for the year.
In China, the most important market for Germany’s luxury carmakers, demand is slowing and local manufacturers are increasingly dominating EV sales. In addition, sales of BMW’s most expensive models could be at risk if Beijing retaliates against the European Union’s investigation into Chinese EV subsidies.
BMW is increasing investment to speed up its EV rollout. With all its EV variants currently turning in a profit, BMW expects EV margins to increase with the recent introduction of fully electric 7-series and 5-series cars. BLOOMBERG
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