Higher costs weigh on earnings at BMW

The Munich-based premium car maker - which owns the Mini, Rolls-Royce and BMW marques - said it has seen a "successful" start to 2024.

A total of 594,533 cars were delivered to customers in the three months to March end, an uptick of 1% on the previous year.

Group revenues were largely flat, easing 0.6% to €36.61bn.

Earnings before interest and tax, however, fell by nearly a quarter to €4.05bn, weighed down by higher manufacturing costs.

Net profit fell 19% to €2.95bn.

The EBIT margin in the automotive division was 8.8%, down on last year’s 12.1% and below analyst expectations for around 9.2%. It was, however, within BMW’s 8%-10% forecast range.

Looking to the rest of the year, BMW said it continued to expect "slight growth" in customer deliveries. But it also noted that group earnings before tax would likely "decrease slightly, due to higher manufacturing and fixed costs, particularly personnel costs and R&D expenses".

It said: "The projected decrease in used car prices is also anticipated to contribute to this development."

The full-year EBIT margin for the automotive business is expected to be between 8% and 10%.

As at noon BST, shares in the firm were down 3%.

Oliver Zipse, chair of the board of management, said: "The past nine quarters underline BMW’s continuity and reliability. As planned, we are dynamically expanding the share of electric vehicles while maintaining our high level of profitability.

"We will remain on this course."