BMW Reports 13% Drop in Q3 Sales

BMW (ETR:BMWG) has announced a 13% decline in third-quarter group-wide sales, primarily due to a significant decrease in demand in China and a globally challenging market.

The German luxury automaker reported total automotive sales of 540,882 units for the quarter, marking a 4.5% year-over-year decline, totaling 1,754,158 for the first nine months of the year.

The performance in Q3 was notably impacted by delivery halts resulting from a braking system recall that affected over 1.5 million vehicles globally.

Due to the recall, BMW previously lowered its profit and sales targets for the 2024 fiscal year, estimating a financial impact in the "high three-digit million (euro) amount" for the third quarter.

According to a BMW spokesperson, the problem was initially detected during an internal quality check, leading to a recall initiated in February, with additional cases identified later.

On Thursday, the company, which owns the Mini and Rolls-Royce brands, acknowledged a "difficult market environment" in China, which reported a 29.8% decline in sales to 147,691 units in Q3 and a total of 523,638 units, down 13.1%, for the year up to September.

The recall is expected to impact around 370,000 vehicles in China. Last month, citing the recall costs and weakness in the Chinese market, BMW reduced its full-year automotive segment outlook for earnings before interest and tax to 6%-7%, down from 8%-10%.

Furthermore, worldwide deliveries are anticipated to slightly decrease in 2024 compared to previous projections for a slight increase.

Despite the challenges, BMW Board of Management member Jochen Goller indicated that the company’s fully-electric offerings are gaining popularity, with a 19.1% increase in battery-powered EV sales over the first nine months of the year. Sales in Europe showed growth during the same period.

Following the announcement, BMW shares remained stable in early European trading.