Thursday, 1 December, 2022

BMW sees profits jump on higher prices for luxury cars

FRANKFURT: German automaker BMW reported Thursday a 23-percent increase in third-quarter profit thanks to robust demand for pricier luxury models, but it warned that soaring inflation could limit purchases from consumers.

The Munich-based group said it had booked a net profit of nearly 3.2 billion euros ($3.1 billion), up from 2.6 billion euros between July and September last year.

Car deliveries, however, were down nearly one percent over the period, as the industry continues to grapple with supply chain disruptions and Covid lockdowns in China, reports AFP.

BMW said "higher prices" for its premium vehicles had helped deliver a "solid" third quarter.

The group said it was on track to meet its full-year earnings targets. Although the overall sales volume was expected to be "slightly lower" than in 2021, sales of fully-electric vehicles should still double, it said.

"The market success of our fully-electric models, in particular, means we can look forward to the coming months with confidence," CEO Oliver Zipse said in a statement.

With many countries bracing for a recession as Russia's war in Ukraine sends energy prices higher and central banks raise interest rates to tame red-hot inflation, the group warned that customer demand would slow in the months ahead.

"High inflation rates and interest rate hikes are causing conditions for consumers to deteriorate, which will impact their purchasing behaviour in the coming months," BMW said.