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BMW posts flat profit as investments erode margins
[FRANKFURT] BMW posted flat third-quarter operating profit on Friday as investments in new technologies and hiring staff ate into profits from sales of its premium cars.
Despite a 7.1 per cent rise in sales for BMW, Rolls-Royce and Mini-branded cars, the return on sales at BMW's automotive division fell to 8.5 per cent from 9.1 per cent a year earlier.
BMW said the dip in profits was mainly attributable to higher personnel expenses as group staff increased by 3.6 per cent, and due to changes in the model and regional sales mix for cars.
BMW said sales conditions in the United States, a market where sales of highly profitable sports utility vehicles has been strong, had become "volatile" in the third quarter, leading sales in the Americas to slump 3.6 per cent.
BMW said third-quarter earnings before interest and taxes (EBIT) were 2.38 billion euros (US$2.64 billion), in line with the 2.37 billion-euro consensus estimate in a Reuters poll.
Shares in BMW were indicated down 0.4 per cent ahead of the Frankfurt market open.