Affected by the dual impact of declining sales in the Chinese market and escalating trade tensions, BMW Group's automotive manufacturing profit for 2025 is expected to be significantly lower than its long-term target.
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On Friday, March 14, BMW Group announced its financial report for the fourth quarter and the full year of 2024.
1) Key Financial Data
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Revenue: Fourth-quarter sales amounted to €36.42 billion, a year-on-year decrease of 15%, lower than the estimated €41.23 billion. Full-year revenue was €142.38 billion, a year-on-year decline of 8.4%.
Profit: Fourth-quarter EBIT was €1.88 billion, a year-on-year decrease of 57%, lower than the estimated €2.67 billion. Full-year EBIT was €10.971 billion, a year-on-year decline of 39.2%.
Automotive Division Revenue: Fourth-quarter revenue from the automotive division was €34.05 billion, a year-on-year decrease of 8.7%, lower than the estimated €35.95 billion.
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In terms of delivery numbers, BMW Group's fourth-quarter vehicle deliveries totaled 696,697 units, a year-on-year decrease of 2.9%, lower than the estimated 696,869 units.
After dropping to a four-year low of 6.3% in 2024, BMW expects the EBIT margin for its automotive business to fall to between 5% and 7% in 2025, far below its long-term target of over 8%. BMW also stated:
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“The newly imposed trade tariffs could reduce this year's earnings by €1 billion ($1.09 billion), as the escalating trade tensions increasingly impact the finances of global companies.”
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BMW Chief Financial Officer Walter Mertl stated that if the U.S. raises the tariff on imported cars from the EU from the current 2.5% to 10%, and if this tariff remains unchanged throughout the year, it would further reduce the profit margin by 0.5 percentage points.
BMW executives indicated that the company plans to leverage its global production network to adjust the models produced at various plants and change output to mitigate the potential impact of tariffs as much as possible. Additionally, BMW will conduct a more in-depth analysis of the possibility of further localizing parts production in the U.S.
Moreover, BMW is making significant investments in updating its model lineup and is attempting to regain market share through its new electric vehicle product line, Neue Klasse, which is set to begin production later this year. The first model in this new series is expected to debut at the end of this year, with plans to launch over 40 new and updated models by 2027. BMW stated:
<blockquote>
“The new BMW 5 Series, BMW X3, updated Mini series, and BMW 2 Series Gran Coupe will be fully launched this year. With inflation stabilizing and interest rates declining, automotive demand is expected to rise slightly.”
BMW's European stock fell by more than 1%.
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BMWYY

After falling to a four-year low of 6.3% in 2024, BMW expects its automotive business's EBIT margin to drop to between 5% and 7% in 2025, well below its long-term target of over 8%

- BMW Group's automotive manufacturing profit for 2025 is expected to fall significantly below its long-term target due to declining sales in the Chinese market and escalating trade tensions.  
- In Q4 2024, BMW reported a revenue of €36.42 billion, a 15% year-on-year decline, with EBIT dropping 57% to €1.88 billion.  
- The company anticipates a further decrease in profit margins due to potential new tariffs, while planning to adjust production and introduce new electric vehicle models to regain market share.

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BMW's Q4 revenue fell 15% year-on-year, and EBITDA was halved, affected by tariffs, leading to a downward revision of the annual profit guidance | Financial Report Insights