BMW: 2024 useful 37%, China weighs on the crisis

The German car manufacturer BMW closed 2024 with an annual net profit decreased by over a third, weighed down by sales in China, its largest market. Net profit dropped by 36.9% On an annual basis, reaching 7.68 billion euros, said the group in a note, in the context of the crisis of the German industry, a pillar of the largest European economy.

After three years of exceptional profits, German car manufacturers face a drop in demand, an increase in costs, in particular energy, and the competition of the Chinese brands, which since last year have always positioned themselves better in the electrical segment. In 2024 BMW recorded a 4% drop in car deliveries, with a consequent impact on revenues, dropped by 8.4% to 142.38 billion euros. In China, its main market and where the brand creates almost a third of its sales, they decreased by 13.4%. The drop in sales was also caused by a defective braking system that led to calls and interruptions of deliveries in the third quarter, affecting 1.5 million vehicles. These difficulties forced BMW to publish a profit warning at the end of September.

The group also recorded a drop in sales of its products in the third quarter.

The impact of duties in 2025

BMW has provided that the profit margins for its automotive activity this year will be under the expectations of analysts, taking into account the impact of the US duty imposed in recent weeks and anticipating one even more intense commercial war.

The German car manufacturer predicts that its profit margin for cars will be 5-7% in 2025, below an estimate of LSEG consent of 7.3%, dragged downwards of a percentage point by the impact of the customs rates already imposed by 12 March. The United States have Increased duties on the imports of American steel and aluminum and imposed a 25% customs tax on some vehicles from Mexico, including the BMW. He also threatened higher rates on imports from Europe from April 2nd.

CEO, USA and Germany of Key Export Hub for us

The BMW CEO said that the car manufacturer built in the United States, Europe and China approximately as many cars as they have sold in each market. Oliver Zipse explained, in the conference on the results of the car manufacturer, that a total of the 56% of the vehicles that BMW produces in Germany is exported outside the European Union and its plant in South Carolina exports a car for a value of over 10 billion dollars, making the company the largest automotive exporter in the United States in terms of value.

“We take advantage of an integrated global economy – underlined Zipse – that’s why we continue to support open and free trade markets”.