BMW Projects Fourth-Quarter Earnings Drop, Revises Profit Forecast
BMW has announced that its fourth-quarter earnings before taxes are expected to fall significantly below last year’s levels, with its full-year margin likely to land in the lower half of its revised 6-7 per cent target range.
The update was shared via investor presentation slides published on the automaker’s website on Tuesday.
The company cited inflationary pressures and higher fixed costs associated with unwinding inventory as the primary factors impacting its fourth-quarter performance. These challenges have led to a year-on-year decline in margins compared to the same period in 2023.
The presentation was part of a closed call with investors during a quiet period ahead of the company’s annual results announcement, scheduled for March 14. The press was not granted access to the call.
BMW initially adjusted its margin forecast in September 2024, reducing the target range from 8-10 per cent to 6-7 per cent, following weaker-than-expected performance earlier in the year.
The carmaker reported a steep 61 per cent drop in third-quarter profits, falling short of analyst expectations due to a combination of declining sales in China and technical issues related to braking systems.
China, a critical market for BMW, has seen economic headwinds and softer consumer demand, adding to the automaker’s challenges. These factors, coupled with global inflationary pressures and rising production costs, have weighed heavily on the company’s financial outlook.
As the automotive industry continues to grapple with supply chain disruptions, fluctuating energy prices, and evolving consumer demand, BMW’s latest update underscores the difficult environment facing global automakers. The company’s upcoming annual results on March 14 will provide further insights into its performance and strategic response to these challenges.
BMW Projects Fourth-Quarter Earnings Drop, Revises Profit Forecast is first published on The Whistler Newspaper
