BMW loses 26.4 percent profit compared to the previous year

BMW caught a false start into the new year. The bottom line is that the group made 2.2 billion euros in the first quarter. That was 26.4 percent less than in the same period last year. Above all, a weak China business spoiled the balance sheet, and over the course of the year, the US tariffs are also likely to cost even more, which had hardly yet affected the current figures. Nevertheless, BMW adheres to its forecast.

The more demanding the environment, the more decisive products, strategy and flexibility, said CEO Oliver Zipse. The different customer requests worldwide are served and can achieve robust results and keep the course on the annual goals.

Already the sales figures published in April for the first quarter did not allow anything to be expected: The significant crash in China had dragged the global sales of the BMW Group, which also include Mini and Rolls-Royce. Specifically by 1.4 percent on 586,000 cars. This resulted in sales of 33.8 billion euros – 7.8 percent less than a year ago.

BMW is not alone with its slump in profits – and did not do that badly compared to the German competition: Archrival Mercedes has reported a violent minus from 43 percent to 1.73 billion euros for the first quarter. In the other major premium competitor Audi, the bottom line was only 630 million euros – that it was only a minus of 14.4 percent, was the very weak comparison quartal from the previous year alone. The German number one and Audi-Mother Volkswagen was 2.2 billion euros and a minus of 41 percent.

The mood in the German auto industry – including suppliers – is bad. The business climate index for the industry, which is raised by the IFO Institute, is deep in the negative area with minus 30.7 points. Especially in the export expectations, it recently went down, and companies also estimate their competitive position less outside of the EU, according to the economic researchers.

They are the two major problems of the industry important for Germany: in China, the carmakers are exposed to an increasingly stronger domestic competition and a sharp price competition. And in the United States, the fear of how the tariffs of President Donald Trump will continue pushes. Even the US company Ford has recently spoken of billions in pollution for Trump’s trade policy.

BMW produces about as many cars in the United States with just less than 400,000 vehicles per year as it sells there. However, more than half of them are also exported from there. This regularly brings the surprising title of the largest US car exporter according to the value of the vehicles, but makes it necessary to import other cars and parts to the USA. Higher tariffs BMW significantly. The loads from tariffs and possible counter -tariffs could be in the billion dollar area.

Nevertheless, BMW has now confirmed its forecast from March. Also because the group assumes that the current increases will sometimes be temporary and will trust the demand for its cars. The forecast sees an input tax result at the previous year’s level before – that would be roughly 11 billion euros. However, BMW also warns: The actual business course may deviate compared to these expectations – among other things due to new tariffs or if applicable tariffs apply longer than expected.