German automobile manufacturer, BMW have announced a fall in first quarter year profits, in which it blames the poor European market.
This week, in its first quarter records, BMW announced that net profits fell by 3% to 1.31 billion Euros (£1.1 billion) and revenue fell by 4.1% to 17.54 billion Euros. This is despite that it delivered 448,200 vehicles worldwide in the quarter from January to April, up 5.3%. The increase in sales is down to the increasing demand from the emerging Chinese market.
A spokesperson for BMW has said: “We don’t expect to receive a great deal of impetus from most European markets over the next few months. We achieved a new sales volume record for a first quarter and we managed to keep revenues and earnings at high levels. This should ensure that total annual profits remain at the same levels as last year”.
BMW are not doing as badly as Volkswagen
Christian Stadler, an expert in the auto industry has said “The car industry is suffering just as the European economy is suffering,” he said, though there were “firms bucking the trend. High-end brands aimed at richer customers are not doing as badly. Car firms positioned in this way will be able to avoid the worst of the European slowdown. If you look at Germany, BMW is not doing as badly as Volkswagen.”
According to industry data, sales in Europe for all car makers fell 9.8% in March, the 18th drop in a row and there is little sign of a turnaround.
Last week, BMW’s fellow German automakers, Daimler and Volkswagen also reported falls in first-quarter profits, again down to poor demand from the European market.
BMW has several subsidies, including British legends, Mini and Rolls-Royce.