BMW offsets lower deliveries with higher prices, EV sales

BMW’s net profit was €2.58 billion, with an EBIT margin in its automotive division of 7.8 per cent. — AFP pic
BMW’s net profit was €2.58 billion, with an EBIT margin in its automotive division of 7.8 per cent. — AFP pic

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BERLIN, Nov 3 ― Higher prices and strong electric vehicle sales helped German automaker BMW beat analysts' forecasts today with a 42.4 per cent year-on-year increase in third quarter net profit to €2.58 billion  (RM12.4 billion).

The premium automaker, which said earlier this year it expected to deliver up to 90,000 fewer cars in 2021 because of a global shortage of semiconductor chips, saw deliveries fall 12.2 per cent in the third quarter but still boosted revenues by 4.5 per cent.

Electric vehicles in particular saw a significant boost, with sales in the nine months to September almost double last year's levels at just under 232,000 vehicles.

“A better product mix and good price setting of new vehicles alongside a stable pricing trend of used vehicles strengthened the financial performance of the business,” a company statement said, reporting an operating profit (EBIT) margin in its automotive division of 7.8 per cent.

Automakers from Volkswagen to Stellantis to Renault reported dampened third quarter sales due to scarce chip supply. Companies able to offset losses through higher prices ― such as BMW rival Daimler ― fared better than others.

BMW had warned in August that supply chain bottlenecks would hit the second half of the year, after it reaped net profits of €4.8 billion in the second quarter in a post-lockdown rebound.

Across Germany, passenger car output was 35 per cent below 2019 levels in the three months to September, according to auto industry association data.

Still, BMW maintained its full-year EBIT margin forecast of 9.5 per cent to 10.5 per cent for its automotive division, adding this goal would be achieved through slightly reducing the number of employees.

“We are on track for our full-year forecast and are looking forward,” CFO Nicolas Peter said. “We expect that semiconductor supply will be in an issue for us beyond 2021.” ― Reuters

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