BMW 2011 third-quarter profits grow thanks to the new X3
BMW’s third-quarter profits have grown thanks to the X3 SUV, with an increase of $2.35 billion over last year’s sales. Net income increased 24 percent, and overall revenue has increased by 3.8 percent, as well.
The market growth for luxury automakers has slowed due to economic upset in Europe, but BMW has still done better than analysts anticipated. While BMW has done well, Audi has still generated more profit this quarter.
“Challenges to keep flexibility, to keep the efficiency up there are pretty huge for the industry,” Arndt Ellinghorst, a London-based analyst with Credit Suisse, said in a Bloomberg Television interview.
BMW’s automotive unit operating profit was at a record high for second quarter at 14.4 percent, but fell to 11.9 percent this quarter due to a decline in 3 series sedan and 1 series compact sales. Improvements in sales figures for the X3 and 5 series helped keep figures up, and BMW still feels the numbers are better than expected.
“It seems that the phase-out of the 1 series and 3 series is going better than planned,” said Georg Stuerzer, a Munich-based analyst with Unicredit. “With that kind of a margin during the changeover of the best- selling models, you can’t complain.”
The new 3 series is scheduled for release in February, while the new 1 series came out in September. Third quarter saw a 28 percent drop for 1 series deliveries, with a total of 34,600 units sold, and the three series sold a total of 95,200 units, at a 1.4 percent decline.
Sales growth has slowed for the third quarter from 18.5 percent last quarter to 9 percent. Audi’s margin is up over BMW, at 13.1 percent.
– By: Alexandra Koken
Source: Automotive News