BMW slashes auto margin forecast due to war in Ukraine

BMW said that while it was still able to source spare parts from western Ukraine and was engaging suppliers in other locations around the world to maintain production, further production disruptions were imminent. plan for the coming weeks.

The automaker expected to deliver an even higher number of vehicles this year, but now expects to be on par with 2021. BMW sold a record 2.52 million vehicles last year despite fuel shortages. semiconductors and recorded an EBIT margin of 10.3% for 2021, its highest. since 2017.

BMW said the war in Ukraine made it difficult to give specific guidance for 2022 and it could not factor any long-term implications into its forecast.

“We are optimistic that we can alleviate wire harness shortages,” CEO Oliver Zipse said in an interview with Bloomberg Television. BMW has more than one supplier in Europe and is able to cope with the situation, he said.

The company said it does not see the semiconductor shortage improving until the second half of the year, an issue that has slowed industry production lines across the world.

BMW said it expects 15 all-electric models to be in production this year, including some in pre-production, and highlighted the rollout of the new i7 luxury sedan.

The company also said it was developing new battery technology and could quickly reach its goal of having fully battery-powered vehicles accounting for half of its global sales by 2030.

BMW has previously said it expects sales of all-electric vehicles to double in 2022 as the company’s i4 coupe and iX SUV go on sale in major markets.

BMW’s overall profit, including its finance and motorcycle segments, is expected to increase significantly this year, the company said, helped by the full consolidation of its Chinese joint venture BMW Brilliance.

BMW won approval from Chinese authorities in February to increase its stake in the company with Brilliance China Automotive Holdings to 75% from 50%, one of the first Western automakers to benefit from the relaxation of Chinese rules on the foreign ownership. The inclusion will have a positive effect of between €7 billion ($7.7 billion) and €8 billion on the group’s pre-tax profit.

Chinese company BMW assembles BMW-branded models for sale locally and the all-electric iX3 SUV, which is also exported to global markets.

Mary I. Bruner