BMW Posts Flat Profit As Investments Erode Margins
Investments in new technologies and hiring staff ate into profits from sales of its premium cars.
A BMW 740Le xDrive hybrid car is displayed at the Mondial de l'Automobile, Paris auto show, during media day, in Paris, France, September 30, 2016.
BMW posted a flat third-quarter operating profit as investments in new technologies and hiring staff ate into profits from sales of its premium cars.
Despite a 7.1 percent rise in sales for BMW, Rolls-Royce and Mini-branded cars, the return on sales at BMW's automotive division fell to 8.5 percent from 9.1 percent a year earlier.
BMW said the dip in profits was mainly attributable to higher personnel expenses as group staff increased by 3.6 percent, and due to changes in the model and regional sales mix for cars.
BMW said sales conditions in the United States, a market where sales of highly profitable sports utility vehicles have been strong, had become "volatile" in the third quarter, leading sales in the Americas to slump 3.6 percent.
BMW said third-quarter earnings before interest and taxes (EBIT) were 2.38 billion euros ($2.64 billion), in line with the 2.37 billion-euro consensus estimate in a Reuters poll.
Shares in BMW were indicated down 0.4 percent ahead of the Frankfurt market open.