BMW has expressed confidence in strong fourth-quarter sales and reported that its order book is already filled into the first months of the next year. The company mentioned that it saw no need to reduce prices, unlike some of its competitors. While vehicle availability is improving as supply chain issues are being resolved, higher material and logistics costs persist, especially for labor.
BMW's shares rose 3.3% at 1035 GMT, with the third-quarter results meeting expectations and delivered with a more positive tone compared to some competitors who have warned of a challenging market environment affecting demand.
When asked if BMW would consider reducing prices to boost electric vehicle demand, particularly in China where intense market competition has been ongoing, Chief Executive Oliver Zipse stated that price reduction was not part of BMW's strategy. He emphasized that BMW is achieving substantial growth even with competitive pricing.
The premium automaker has forecasted an annual margin on earnings before interest and taxes (EBIT) in its cars division of 9.0% to 10.5% and is on track to meet that target with a 10.3% margin achieved so far this year.
While higher-priced and fully electric cars have boosted quarterly revenues, the group's net profit fell 7.7% due to a one-off gain in the previous year when BMW acquired majority control of its Chinese joint venture.
BMW did experience some relief in raw material prices during the quarter compared to the previous year, but it still faced a 200 million euro impact from the net balance of currency and raw material positions. Materials and logistics costs have remained high, with labor costs being a notable contributor.
In contrast to competitors such as Mercedes-Benz and Porsche, BMW's statement made no reference to the impact of high-interest rates or inflation on growth.
The company has exceeded its target for fully electric sales in the third quarter, with 15.1% of total sales being electric vehicles. Models from the upper price segment are driving sales growth.
BMW's free cash flow for the automotive business reached 5.7 billion euros so far this year, close to the full-year forecast of 6 billion.
($1 = 0.9409 euros)