BMW sticks to cautious forecast as profits shift up

FRANKFURT AM MAIN: German carmaker BMW reported yesterday a leap in profits in the second quarter, but stuck to its forecast for the full year as it spends on new models and research and development.

Net profit at the group reached 2.2 billion euros (US$2.6 billion) between April and June, a 13.6per cent increase compared with the same period last year.

Operating, or underlying profit grew 7.5 per cent to reach 2.9 billion euros, on the back of revenues up 3.1 per cent at 25.8 billion.

The group pointed to some 40 new models from its high-end car brands BMW, Mini and Rolls Royce scheduled for release in 2017 and 2018, an “offensive” that it hopes will boost unit sales, especially in the United States.

BMW was overtaken by historic rival Daimler’s MercedesBenz in 2016 as the biggest-selling luxury carmaker.

The group also highlighted its sales of electric vehicles, which reached 42,573 in the first six months. It aims to sell more than 100,000 over the full year for the first time.

German carmakers are under pressure from the government over high levels of harmful emissions from diesel vehicles, as a long-running scandal over cheating on regulatory emissions tests has deepened.

BMW has offered to refit hundreds of thousands of diesel cars already on German roads with a software update to reduce their emissions of nitrogen oxides, under a sector-wide deal between the government and carmakers agreed Wednesday.

The Munich-based firm will also offer discounts for owners of old diesels who trade them in for new ones. — AFP