SHERIDAN, WYOMING – Dec. 4, 2024 – The BMW Group remains optimistic about its full-year performance despite facing challenges in the third quarter of 2024. The company announced its adjusted financial guidance, highlighting its strong position in the electric vehicle (EV) market and its commitment to long-term growth.
Navigating Q3 Challenges
Munich. The BMW Group expects sequentially increasing deliveries in the final quarter of 2024. This follows a third quarter in which technical actions linked to the Integrated Braking System (IBS) presented extraordinary challenges. As stated in the ad hoc announcement on September 10, the technical actions – together with weak demand in China – dampened the sales and revenue situation in the reporting period from July to September. Moreover, additional IBS-related provisions for warranty obligations in the high three-digit million-euro range impacted the third quarter. As a result, the BMW Group adjusted its 2024 financial guidance.
Despite these challenges, the BMW Group delivered a total of 1,754,157 automobiles in the first nine months of the year, with 540,881 vehicles delivered in the third quarter. The company's global presence allowed it to balance varying sales performance across different regions.
Strong Growth in Electric Vehicles
The BMW Group's electrification strategy continues to gain momentum, with BEV deliveries increasing by 10.1% year-on-year. In the third quarter, BEVs accounted for 19.1% of the company's total sales.
“After the extraordinary challenges in the third quarter, we are looking ahead: In the fourth quarter, we are back on track for stronger earnings in order to achieve our annual targets, despite planned high upfront expenditures,” said the Chairman of the Board of Management of BMW AG, Oliver Zipse, on Wednesday.
Investing in Future Technologies
The BMW Group remains committed to investing in research and development, with a focus on electrification, digitalization, and the rollout of its NEUE KLASSE electric vehicle platform.
“We are striking a balance between securing short-term earnings and long-term success: This year we are investing more than ever in new products, technologies and our plants, so that we can continue the BMW success story with the NEUE KLASSE from next year onwards.”
Financial Performance
The IBS-related challenges and weaker demand in China impacted the BMW Group's financial results in the third quarter. Group revenues were €32,406 million, and the EBIT margin decreased to 2.3%. However, the company expects a stronger fourth quarter and remains committed to its adjusted full-year guidance.
Free Cash Flow and Share Buyback Program
The company aims to reduce inventory levels in the fourth quarter and maintain its forecast free cash flow of over €4 billion. The BMW Group has also continued its share buyback program, completing the third tranche of its current program on October 25, 2024.
Financial Services and Motorcycles Segments
The Financial Services Segment saw significant growth in new financing and leasing contracts. The Motorcycles Segment is expected to deliver customer deliveries on par with the previous year, despite a challenging market environment.
Looking Ahead
The BMW Group is confident in its ability to navigate the dynamic market conditions and achieve its long-term goals. The company's focus on electrification, digitalization, and global presence positions it for continued success in the evolving automotive landscape.