FRANKFURT -- BMW Group said its global vehicle sales fell 2.1 percent to 204,041 in May, weighed down by China tariffs, the launch of a new model, and a 14 percent drop in German registrations as cities such as Hamburg started banning older diesel vehicles from key streets.
BMW said plans to retool its China factory to produce the X3 SUV locally, rather than importing it from the United States, had hurt availability of this volume model in the world's largest car market.
Furthermore, customers in China have held back orders after the country announced it will lower tariffs on imported cars from 25 percent to 15 percent from July 1 onwards.
"In the second half of the year, the X3 will once again become fully available worldwide, bringing increased sales momentum in the third and fourth quarters," BMW's sales chief, Pieter Nota, said.
BMW brand sales fell 1.8 percent last month, while Mini registrations were down 4.4 percent.
In Germany, several bank holidays in May caused fewer working days compared with last year, and the city of Hamburg said it will ban the most polluting diesel vehicles from two streets, hitting demand for diesel cars.
Through May, BMW Group sales rose 1.6 percent to 1.0 million.