Bmw posted a huge jump in second-quarter profit thanks to U.S. and China

Article by Christian A., on August 1, 2011

BMW AG reported a huge jump in second-quarter profit, thanks to the rebounding U.S. spending and the growing wealth in China that contributed to the increase in the demand for premium vehicles. Specifically, the company recorded 2.86 billion euros ($4.1 billion) in earnings before interest and taxes for the second quarter this year from 1.72 billion euros on the same period last year.

The profit outperformed the average estimate of 2.3 billion euro made by 17 analysts as compiled by Bloomberg. Revenue increased 17 percent to 17.9 billion euros.

On July 12, BMW increased its estimates profit and sales forecasts for 2011, citing strong demand in the vehicle markets all over the world. The company, which produces the core brands Mini, BMW and Rolls-Royce, emphasized that EBIT at its vehicle division will exceed 10 percent of revenue in 2011.

According to CEO Norbert Reithofer in a statement, strong demand for Mini, BMW and Rolls-Royce brands all over the world, together with efficiency improvements in all areas of the company, greatly contributed to the “outstanding performance."

The company achieved the highest profit margins among the top three manufacturers of premium vehicles. The company's auto division posted EBIT equal to 14.4 percent of sales, outperforming a 10.7 percent at Mercedes-Benz brand and an 11.8 percent margin at Audi unit. BMW forecasts that its sales will increase to at least 1.6 million vehicles, versus an earlier estimate of 1.5 million.

However, the company revealed that the rates of growth will slow in the second half due to changes in its lineup. The company will launch an overhauled variant of the 1 series compact in September in an effort to outperform the A3 of Audi.

Vehicle model introductions will contribute about 500 million euros to expenses in the last half of the year, Friedrich Eichiner, the company’s chief financial officer, stated last May 4.

If you liked the article, share on:

Comments

Recommended

To keep the Nissan Maxima interesting, the Japanese automaker gives the 2018 model year a number of small tweaks. Some of these include standard Android Auto, which is a new...
by - October 23, 2017
It looks as if Chevrolet has everything planned out in terms of production. Firstly, they have plans of introducing the Corvette ZR1 in a few months, which will then be...
by - October 23, 2017
While Tesla Motors continues to struggle with regards to the assembly of its much awaited Tesla Model 3, investment firm Oppenheimer & Co. is confident that its previous production estimates...
by - October 22, 2017
It seems that BMW’s high-performance division -- BMW M – still has not warmed up to front-wheel drive vehicles. So those who had been looking forward to BMW M vehicles...
by - October 22, 2017
Porsche already has the Performance Package for their range-topping Macan Turbo, which is currently available in some countries. Soon, this model will be dethroned by something even fancier by the...
by - October 22, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries