BMW sees absurd increase in profits and you can benefit from it
Need more profit? Just sell more expensive things. It can be as simple as that, BMW now knows that too, which has more than 5 billion more left than before. However, the picture for the future is not all rosy.
Anyone who owns or wants to buy BMW shares can now benefit from a new €2 billion share buyback program.
BMW makes up to 5.4 billion more profits
In any case, the German car company BMW made significantly more profits in the first quarter of this year. The manufacturer benefited from strong sales of its most expensive models and price increases, which offset weaker demand for its cheaper entry-level models.
$2 billion share buyback program
Profit before taxes and interest payments increased by almost 60 percent to 5.4 billion euros. BMW’s profits were boosted by Chinese company BMW Brilliance Automotive, in which the company acquired a majority stake in late 2022. To reward shareholders, BMW also announced a new €2 billion share buyback program. Find out more about the new share buyback program.
Luxury car makers have proved more resilient to the impact of slowing global demand, persistent inflation and higher commodity costs. Despite the removal of bottlenecks in the supply chain, BMW, Mercedes-Benz and Volkswagen still have significant backlogs in their order books that need to be reduced.
No rosy prospects
With production now normalizing and more cars coming onto the market, automakers are at risk that selling prices could fall again. For example, the American car manufacturer Tesla has already reduced the price of its models several times this year in order to stimulate demand.
At the same time, demand for cars could fall if the global economy weakens further. BMW CEO Oliver Zipse said he expected global markets to cool down somewhat, but rising sales of the company’s most expensive models offset the rise in material and transport costs.
Whether you really want to drive a BMW is another matter. At least if you want to appear smart. Read how the German car brand performs in a study on the IQ of different drivers. You can probably feel it coming, not very high.