BERLIN – BMW forecast robust fourth quarter gross sales on Friday and mentioned its order ebook was crammed into the primary few months of subsequent 12 months, with executives including they noticed no want to chop costs as some rival automakers have.
Car availability was bettering as provide chain bottlenecks eased, although greater materials and logistics prices continued, notably for labour, the German group mentioned.
Shares have been up 3.3% at 1035 GMT, with third-quarter outcomes largely in step with expectations and delivered in a extra optimistic tone than some opponents, which warned of a subdued market setting curbing demand.
Pressed on whether or not BMW felt the necessity to lower costs to spice up electrical car demand, notably in China the place a battle for market share has raged this 12 months, Chief Govt Oliver Zipse mentioned this method was not in BMW’s playbook.
“We’ve got no real interest in sinking costs to realize market share. That is not our technique. And as you possibly can see, we’re managing to develop considerably even with very acceptable costs,” he mentioned.
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 on track to hit that focus on with a ten.3% margin to this point this 12 months, it mentioned.
Increased-priced and absolutely 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 increase 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 affect of 200 million euros from the web stability of foreign money and uncooked materials positions, Chief Monetary Officer Walter Mertl mentioned.
Supplies and logistics prices stay excessive, with a notable adverse affect throughout the primary 9 months of 2023 resulting from 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 development, in distinction to opponents comparable to Mercedes-Benz and Porsche.
Totally electrical gross sales hit 15.1% of complete gross sales within the third quarter, outstripping BMW’s end-year goal of 15%. Fashions from the higher worth phase, just like the 7 Sequence, the up to date BMW X7, and the BMW X5 and BMW X6 fashions, are additionally driving gross sales development.
Free money movement for the automotive enterprise to this point 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)