China propels BMW to strong profits, Germany lags

Auto sales are booming in China and Germany's BMW is benefiting

BMW said that its sales in China nearly doubled in the quarter to 230,120 vehicles, partly reflecting the shutdowns in early 2020 as China was hit first by the pandemic. Sales in the overall Asia region however exceeded even pre-pandemic levels.

The company said higher sales volume across key global markets as they rebound from the pandemic recession was accompanied by improved prices. Earnings were also supported by better used car prices in the US, which increases revenues from the sales of cars that have been leased to customers.

BMW CEO Oliver Zipse said that the quarter showed “our business model is a successful one, even in times of crisis.” He said the company's focus is on developing digitally connected, electric cars. The company more than doubled its sales of battery and electric vehicles in the quarter over the year earlier, to 70,200.

Zipse said that the fall in sales in Germany was less than that for the total market, meaning market share had increased, and said that sales in April, the first month of the new quarter, had been “significantly better.”

BMW net profit rose to 2.83 billion euros ($3.42 billion) from 574 million in the year-earlier period. Revenues rose 15% to 26.78 billion euros. Per-vehicle profitability, defined as operating result on sales, reached 9.8%, a big increase from 1.3% in the year-earlier quarter and within the company’s long-term target range.

Chief Financial Officer Nicolas Peter said that the company had not lost any production due to the shortage of semiconductors — the silicon chips that enable many of the electronic functions in today's vehicles — that has affected the auto industry worldwide. He said, however, that the situation remains “tense” with regard to chip supply going forward.