BMW lifts sales and margin targets after strong Q2

(Sharecast News) - BMW Group has raised its sales and margin targets for 2023 after a strong second quarter, in which profits rose 7.5% year-on-year in spite of a challenging trading environment. BMW, which also owns the Mini and Rolls-Royce brands, now expects "solid growth in deliveries" in 2023, up from previous guidance of "slight growth", as a result of improved vehicle availability, high order book levels and the upward volume trend, the company said.

Growth should come from highly priced models as well as fully electric vehicles - the latter are set to account for 15% of total sales for the whole year - meaning the EBIT margin in the automotive division for the full year should be 9-10.5%, up from earlier estimates of 8-10%.

Group pre-tax profit for the second quarter totalled €4.22bn, up from €3.93bn in the second quarter of 2023, on revenues that rose 7% year-on-year to €37.22bn.

Automotive deliveries rose 11.3% year-on-year to 626,726 in the second quarter. lifting first-half volumes to 1.21m, up 4.7% year-on-year.

Electric vehicles as a percentage of total automotive sales nearly doubled from 12 months earlier, from 7.2% to 14.1%. The Automotive EBIT margin for the first half improved to 9.2%, from 8.2% a year earlier.

Meanwhile, deliveries in the motorcycle division rose 8% year-on-year to 64,936, while the margin rose to 16% from 14.7%.

Looking ahead, the company said global economic growth is likely to be dampened by high inflation, weakening demand on global markets and geopolitical tensions, but remained update about its own prospects.

"Despite the generally subdued outlook for the global economy, the current assessment is that the world's automobile markets are likely to grow overall. However, the major markets are expected to develop with varying momentum. In Europe, the overall market is set to grow in 2023, while the US market is expected to remain robust. Despite the tense overall economic situation in China, the automobile market there is expected to grow slightly as a whole in the course of 2023."