Auto industry
BMW profits collapse due to China weakness
Chinese business, which was once so promising, is stuttering. But that is not the only reason for the significant decline in earnings at BMW.
Car maker BMW suffered a slump in profits in the third quarter due to technical problems with braking systems and weakness in the important Chinese market. The group’s net profit fell by almost 84 percent to 476 million euros, as the DAX group announced in Munich. Sales fell by almost 16 percent to 32.4 billion euros due to lower sales.
The costs for technical measures and the delivery stop as a result of problems with brakes supplied by Continental weighed on profitability in the core car manufacturing business. Because the once high-growth Chinese business was also sputtering, the profit margin before interest and taxes in the automobile division slipped by 7.5 percentage points to 2.3 percent. That was an even more significant decline than experts had already feared. BMW had already lowered its outlook in September due to the problems.
dpa
Source: Stern
