BMW announced it begins to feel the effects of the European crisis on its quarterly results and the annual profit target.
Until now luxury automakers such as Audi, BMW and Mercedes have managed to avoid the crisis effects by selling expensive cars, including the BMW 7 Series sedan, to rich Americans and Chinese, managing this way to make up for the loss and overcapacity in Europe. BMW’s Chief Executive Norbert Reithofer said that industry is weakening, even if the company posted a 14% increase in the third-quarter, beating analysts’ forecasts.
“Like the rest of the sector, we are now beginning to feel some headwind,” he said in a statement. “We have to acknowledge that we are all facing dramatic challenges and uncertainties in the global economy today.”
Finance chief Friedrich Eichiner said that the company still plans to increase the full year operating profit, aiming to a 25% rise in the fourth quarter. With factories running at full capacity to meet increasing demand in the US and China, luxury automakers were considered untouchable in front of the crisis, but now signs of weakness are beginning to show up. Mercedes has already announced it will fail to reach this year’s target with 800 million euro.