BMW 2012 profit gains as China demand offsets Europe drop
FRANKFURT (Bloomberg) -- BMW Group reported a 3.5 percent gain in 2012 profit as demand for the new 3-series sedan in China and the United States more than offset a market downturn in Europe.
Earnings before interest and taxes rose to 8.3 billion euros ($10.7 billion) from 8.02 billion euros a year earlier, the company said in a statement today.
Sales advanced 12 percent to 76.8 billion euros.
The maker of BMW, Mini and Rolls-Royce brand vehicles is tapping rising demand in China and the United States to shield itself from the effects of the sovereign-debt crisis on Europe's car market, which reached a 17-year low last year.
BMW is also working to defend its No. 1 position in luxury car sales, which both Volkswagen AG's Audi and Daimler AG's Mercedes-Benz have vowed to seize by the end of the decade.
"We are again targeting further sales volume growth worldwide in 2013 and hence a new record level for deliveries," CEO Norbert Reithofer said in the statement. "However, economic conditions are likely to remain challenging in many markets."
The German automaker is proposing a record dividend of 2.50 euros per common share for last year compared with 2.30 euros a year earlier.
BMW has hired Peter Schwarzenbauer, the former Audi sales chief, as part of an effort to tighten its grip on the premium segment's top spot. Starting April 1 he will be the board member in charge of Mini, Rolls-Royce, BMW motorcycles and group aftersales.
BMW expanded its lead last year with a 12 percent sales increase to 1.54 million BMW-brand vehicles on demand for the new 3 series, 1 series and X1 and X3 SUVs. Audi's deliveries rose 12 percent to 1.46 million, while Mercedes's sales climbed 4.7 percent to 1.32 million.
BMW is targeting a third consecutive year of record deliveries in 2013. The manufacturer this year is introducing the 3-series GT and the 4-series coupe, which is based on the 3-series and is also preparing to roll out its first electric vehicle, the i3 city car.
BMW deliveries through February rose 9.2 percent, giving the brand a 407 car lead over Audi. Mercedes slipped deeper into third place, selling 37,229 vehicles fewer than BMW in the first two months.
Reithofer said last week at the Geneva auto show that the carmaker's factories are running at full capacity to meet customer demand.
Mercedes is also expanding production for its compact car lineup, adding the CLA four-door coupe as a third model to complement the new A- and B-class vehicles.
Reithofer expects global car-industry sales to rise 4 percent this year to about 75.5 million cars, with the U.S. growing 2 percent and China increasing 8.5 percent to more than make up for a 2 percent decline in Europe.
To outpace rivals, BMW is investing 200 million euros in a plant in Brazil to produce 30,000 vehicles annually starting next year and is looking at Russia as a possible spot to add manufacturing.
Audi will expand in North America with a 150,000-unit plant in Mexico, where the manufacturer will start making the Q5 SUV in 2016.Contact Automotive News