BMW Q3 profit rebounds on China demand for luxury cars

BMW Q3 profit rebounds on China demand

FRANKFURT — BMW’s third-quarter revenue rose virtually 10 p.c, boosted by rebounding Chinese language demand for luxurious automobiles.

The automaker reiterated its full-year outlook in a statement on Wednesday, whilst a wave of coronavirus infections continues to brush Europe and the U.s..

BMW’s quarterly pretax revenue elevated 9.6 p.c to 2.46 billion euros ($2.87 billion), lifted by an 8.6 p.c rise in car deliveries.

The automotive EBIT (earnings earlier than curiosity and tax) margin rebounded to six.7 p.c from minus 10.four p.c within the second quarter and 6.6 p.c a 12 months earlier, regardless of a 50 p.c leap in gross sales of lower-margin electrical and hybrid automobiles.

BMW-branded automobiles noticed a leap of 9.Eight p.c in deliveries, primarily because of a 31 p.c improve in China, which accounts for nearly a 3rd of the automaker’s car gross sales. China helped to offset a 16 p.c drop in demand within the U.S., the place gross sales have been hit by the coronavirus pandemic.

The corporate generated revenues of 26.three billion euros ($30.7 billion) within the quarter.

Shifts in shopper habits sparked by the pandemic may also clarify among the restoration in deliveries, with commuters and holidaymakers spurning trains, buses and planes in favor of personal automobiles the place the chance of an infection is decrease.

Nonetheless, BMW warned there’s a excessive degree of danger provided that the pandemic is “clearly regaining momentum,” after nations from Germany to the U.Ok. and France issued renewed lockdowns which can be anticipated to dent gross sales throughout the present quarter.

Individually, CEO Oliver Zipse warned final week {that a} no-deal Brexit would damage BMW’s backside line.

Zipse’s cost-cutting push has improved profitability, with the corporate saying on Oct. 20 that free money circulation from the automotive sector rose to greater than three billion euros within the third quarter.

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