BMW’s only earnings forecast for 2003 is that it will attempt to generate a profit level equivalent to that of 2002. The company is releasing more new models than ever before and high development costs, combined with widespread geopolitical and economic uncertainty, are hampering attempts to increase profits.
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BMW has not issued a precise forecast for its earnings over the 2003 period.During the first half of the year, the company’s results will be hampered by the immense burden of developing and launching new models, such as the new 5 series saloon, the X3 SUV and the 6 series coupe. However, the arrival of these vehicles on the European market is anticipated to boost the company’s revenues for the second half of the year.
At present, sales are flat, with strong performance from the Mini brand compensating for the weaker performance of the BMW range as a whole, the sales of which have decreased around 8% from last year’s levels, to 215,000 units.
Despite this, during 2002, the company managed to achieve a third record year in a row, with a E2.02 billion profit. It is very likely that 2003 will continue this high level of earning, but will break from the trend of recent years by not showing any significant growth over last year’s figure.
Even with such a lack of forecast growth, BMW is one of the more successful players around at present, with rival majors such as Ford struggling with heavy losses and many other European manufacturers having difficulties breaking even. Widespread economic gloom and uncertainties over war in Iraq have damaged the environment for manufacturers in Europe, decreasing consumer willingness to spend money on new cars.
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By GlobalDataHowever, BMW is expecting to benefit at least in part from such uncertain times. At the recent Geneva motor show it demonstrated special high-end armoured versions of its 3 and 7 series cars, which look like regular vehicles, but are designed to withstand a terrorist’s bomb or attack with automatic weapons.
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