BMW has exceeded analyst forecasts with a 13.6% year-on-year increase to second quarter earnings, helped by strong sales of its latest 5 Series model.
Net profit was up 13.6% to EUR2,214m, while EBIT was up 7.5% to EUR2,929m. Second quarter revenues were booked at EUR25,799m, 3.1% ahead of last year’s figure.
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Deliveries of BMW Group vehicles rose 4.6% to 633,582 cars in the second quarter. Deliveries in the first half of the year increased by 5.0% to 1,220,819 units.
“Our customers are excited by the new 5 Series model. Since its market launch and throughout the second quarter it continues to achieve considerable market success. We are confident that the BMW Group, with its three premium brands, will set a new record for deliveries to customers in 2017 and remain the foremost provider of premium mobility,” said BMW CEO Harald Krüger. “Together with the success of our products, our strategy of focusing on profitable growth in the USA is also paying dividends.”
BMW has been hit this year by market contraction in the US, but boosted by strong gains in China.
Deliveries of BMW Group vehicles in the USA in the first half fell by 2.5% to 217,530 units.
However, demand in Asia grew significantly during the first half with deliveries up 15% to 415,888 units mostly due to the group’s strong performance in China. Deliveries of BMW Group vehicles in China grew by 18.5% to 293,572 units (2016: 247,817 units), mainly driven by the full availability of the BMW X1 and the popularity of the new BMW 1 Series Sedan, designed exclusively for the Chinese market.
BMW said it is confident of achieving its projected targets for the current financial year. However, it did warn that there are ‘high levels of up-front expenditure for new technologies, intense competition and rising personnel expenses’. The global political and economic environment is expected to remain volatile, BMW said.
“We forecast slight increases, and hence new record figures, for automotive segment deliveries and profit before tax in 2017,” said Krüger. “With the first half-year now behind us, we are confident of achieving the targets set for the full year. We can therefore begin the second half of the year with cautious optimism. That said, we also continue to expect higher expenditure over the course of the year in connection with key technological and strategic projects on the one hand and the roll-out of the largest model offensive in the history of the BMW Group on the other. Other factors to bear in mind are the politically volatile environment and high upfront expenditure for electric mobility and autonomous driving.”
