BMW Predicts Lower Gains in the Current Year Owing to Steep Investment Costs

Published By : 20 Mar 2015 | Published By : QYRESEARCH

The current year for BMW in terms of profit and volume seems rather bleak, owing to steep investment costs and aging vehicle models. The company has had to incur high costs on newer technologies. The company however anticipates that the profits and sales will increase a little in 2015 after group earnings after 2014 before tax had risen by 10.3% to US$9.23 billion. 

According to the CEO of BMW, the global economic conditions are anticipated to be quite stable and there is a possibility that it won’t deteriorate any time soon. But on the downside, crucial markets such as China are not performing up to the mark in the global economy. In 2014, the total number of Rolls Royce, Mini, and BMW that were sold were 2.12 million. Group revenues surged to 5.7% which exceeded an amount worth 80 bn Euros. Earlier, revenue was mainly sales driven, and it registered a rise of 6.8% for adjusting the effects of currency translation. The automotive segment of the company attained almost a 10% EBIT margin, and this exceeded the lower range of the target that was set to be between 8% and 10%. 

According to BMW, the 4th quarter pretax earnings stood at 1.87 billion, which was at par with the figures of the quarter earlier to the same. Till now, the retail sales figures of the 4th quarter remained by far the highest accounting for substantial gains as against the earlier year. BMW also stated that currency tailwinds and high volumes had led to major revenue gains to a value worth 27 bn Euros. In 2014, investments in new technologies and newer models came to about 4.6 bn Euros. The system of self driving was the latest technology that was introduced by the company last year. 
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