BERLIN: BMW saw a drop in its automotive margin on earnings before interest and taxes to 8.2% from 15.8% last year as the consolidation of its Chinese joint venture BMW Brilliance dampened earnings, it said on Wednesday.
Group earnings before taxes were down 34.3% because of a one-time gain of 1 billion euros ($1.02 billion) in the second quarter of 2021 from a partial reversal of EU trust fines, and 1.1 billion in headwinds from the consolidation, it said.
Overall, the reevaluation of the Chinese joint venture shares boosted earnings before tax by 7.7 billion euros in the first half.
BMW increased its stake in its joint venture with Brilliance Auto Group to 75% from 50% in February after securing the necessary license from Beijing to take majority control.
It said at the time the deal would have a positive effect of 7-8 billion euros on the financial results of the automotive business.
The carmaker reported a group net profit of 3.05 billion euros ($3.10 billion) from 4.8 billion euros last year.
It confirmed its outlook of 7-9% for the automotive segment but said it expects full-year deliveries to be slightly below last year.
“Although the company expects sales volumes in the second half of the year to be solidly higher than in the same perioud of the previous year, this will not fully compensate for lost volume in HY1 2022,” a statement said. Reuters