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 yr, 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 increased materials and logistics prices persevered, notably for labour, the German group stated.
Shares had 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 rivals, which warned of a subdued market surroundings curbing demand.
Pressed on whether or not BMW felt the necessity to lower costs to spice up electrical automobile demand, notably in China the place a battle for market share has raged this yr, Chief Govt Oliver Zipse stated this method was not in BMW’s playbook.
“We’ve little interest in sinking costs to realize market share. That is not our technique. And as you’ll be able to 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 vehicles division of 9.0%-10.5% and is on track to hit that concentrate on with a ten.3% margin up to now this yr, it stated.
Larger-priced and totally electrical vehicles 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 yr’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 yr however nonetheless felt an affect of 200 million euros from the web steadiness of forex and uncooked materials positions, Chief Monetary Officer Walter Mertl stated.
Supplies and logistics prices stay excessive, with a notable unfavourable affect throughout the primary 9 months of 2023 as a result of elements together with excessive labour prices from companions, he added.
In a press release, BMW made no point out of excessive rates of interest or inflation weighing on development, in distinction to rivals resembling 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 phase, just like the 7 Collection, the up to date BMW X7, and the BMW X5 and BMW X6 fashions, are additionally driving gross sales development.
Free money circulate for the automotive enterprise up to now this yr 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; Enhancing by Elaine Hardcastle and Mark Potter)
