Thanks to growing demand and stable prices, the carmaker BMW earned well in the second quarter: sales rose by 7 percent to 37.2 billion euros, profit before taxes by 7.5 percent to 4.2 billion euros. Due to a significantly higher tax burden, however, the bottom line was 3 billion, 3 percent less than in the same quarter of the previous year. CEO Oliver Zipse was confident on Thursday for the year as a whole – the group already raised its forecast on Tuesday.
The market is growing, the order books are full, and the order backlog for individual models will go well into next year, said the new Chief Financial Officer, Walter Mertl. Sales of combustion engines form the strong foundation, “the strong growth comes from the significantly increasing demand for our all-electric vehicles,” said Zipse. The Stromer accounted for 14 percent of sales in the second quarter and are more profitable than expected, said Mertl.
Sales growth of 11 percent and the higher proportion of expensive cars contributed half to the sales increase – the other half comes from the majority takeover and full consolidation of the BBA car factories in Shenyang, China. BMW continues to invest heavily there. “To do a business model without China is an impossibility,” said Zipse.
CFO Mertl: Stable prices
The car division’s return on sales was 9.2 percent in the second quarter and, according to the increased forecast, should reach between 9 and 10.5 percent for the year as a whole. “Our prices are very stable,” emphasized Mertl. BMW was even able to push through price increases. However, there are initial tendencies towards normalization on the market. “We are assuming that the positive effects from the remarketing of returned leasing vehicles will only weaken towards the end of this financial year.”
In the credit and leasing business, BMW was already clearly feeling the burden of rising interest rates, inflation and increasing competition. Investments and, above all, research and development costs have risen. “We are investing more than planned in the global ramp-up of e-mobility,” said Mertl. Cars are to be built on the new “New Class” electric platform at the new plant in Hungary from 2025, and in Munich and Shenyang from 2026. The group is also increasing its inventories to ensure production even in the event of supply bottlenecks.
BMW is aiming for “solid growth” in deliveries and a better return on sales for the current year. However, pre-tax profit “will decline significantly”. The reason is the BBA majority takeover, which brought in a one-time income of 7.7 billion last year through the revaluation of the shares already held. Without taking this one-time effect into account, the result would be “significantly higher than the previous year”, according to the group.
