WUHAN, CHINA – MAY 25: (CHINA OUT) Attendees wear protective masks as they look around the at BMW Ix3 during 2023 Central China International Auto Show on May 25, 2023 in Wuhan, Hubei province, China. More than 80 brands took part in the 2023 Central China International Auto Show which started on Thursday. According to local reports more than 40 brands electric vehicle brands participated in the exhibition. (Photo by Getty Images)
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BMW‘s net profits slumped by more than a third in 2024, flagging “continuing subdued demand in the Chinese market.”
Net profit for the year fell by an annual 36.9% to 7.68 billion euros ($8.32 billion). The print was in line with an LSEG forecast, according to Reuters.
Shares were trading 1.9% lower at 8:31 a.m. London time on Friday.
The car maker said that it expects an earnings margin for cars of around 5% to 7% in 2025, compared with 6.3% achieved last year, but noted that the implementation of tariffs was set to have a negative impact on earnings in the year ahead.
“A challenging competitive environment and macroeconomic, trade and geopolitical developments could all have a significant impact on business performance,” the company said in a statement.
The company’s forecasts account for all tariffs imposed up to March 12, including levies on U.S. steel and aluminum imports, and tariffs of 20% on imports from China and of 25% on imports from Canada and Mexico.
BMW’s chief financial officer said that added tariffs on U.S. imports imposed up until that date would lower its autos earnings margin by one percentage point, according to Reuters, citing a copy of a speech due to be delivered to investors later Friday.
The automaker said that it expects an ongoing “challenging situation in China,” while also naming tariff hikes and “ongoing support measures for the supply chain” as headwinds this year.
BMW deliveries totaled around 2.45 million units last year, slightly down from the 2.55 million of 2023. The company largely attributed the decline to delivery stops linked to a faulty braking system supplied by Continental, which last year prompted the carmaker to lower its full-year outlook.