BMW's Q1 EBIT plummeted 23% year-on-year, maintaining its profit guidance unchanged, stating that some automotive tariffs will be temporary | Earnings Report Insights

Clouds of tariffs loom over the outlook, with BMW's revenue and profit both declining, and significant impacts from tariffs expected on second-quarter performance. On Wednesday, May 7, German luxury car manufacturer BMW Group announced its financial report for the first quarter of 2025. Key financial data: Revenue: First-quarter sales fell 7.8% year-on-year to €33.76 billion, below the market expectation of €35.14 billion; among them, first-quarter automotive business revenue decreased 5.6% year-on-year to €29.21 billion, also below the expected €30.15 billion. Profit: First-quarter net profit was €2.173 billion, down 26.4% year-on-year; EBIT plummeted 23% to €3.14 billion, compared to the expected €2.82 billion. Delivery volume: Global delivery volume in the first quarter was 586,117 vehicles, a slight year-on-year decline of 1.4%, lower than the analyst expectation of 594,537 vehicles. Among them, BMW's performance in the Chinese market was particularly poor, with first-quarter sales down 17%, marking the worst first-quarter performance since 2020. Tariff policies add uncertainty, significantly impacting second-quarter performance Electric vehicles provided a glimmer of hope for BMW's first-quarter performance, with overall sales increasing by 32% year-on-year, and growth in the European market reaching 64%. According to media reports, BMW and other manufacturers may benefit from consumer protests against Tesla. In terms of profit guidance, leveraging stable market demand for its high-end models, BMW maintained its full-year financial guidance, predicting an EBIT margin for the automotive business between 5% and 7%. In the statement, BMW indicated that trade tensions have increased uncertainty, which will significantly impact second-quarter performance; however, it expects some tariffs to be only temporary, with stable inflation and moderate interest rate cuts expected to boost demand in several markets this year. In March of this year, BMW CEO Oliver Zipse stated that the U.S. automotive tariff policy would cost the automaker about €1 billion this year. To mitigate the impact, BMW is considering increasing shifts at its plant in Spartanburg, South Carolina. Previously, Mercedes and Stellantis had already canceled their guidance due to the chaos caused by rapidly changing tariff policies, while Volkswagen warned that it had not yet accounted for the impact of new tariffs imposed