BMW Faces Earnings Hit Amid Global Tariff Tensions

BMW anticipates a hit to its earnings due to trade tariffs, impacting its finances by 1 billion euros. Despite challenges in China and U.S., BMW remains optimistic, forecasting a 5-7% earnings margin for its car segment by 2025. The tariffs disrupt global supply chains but no European restructuring is planned.

BMW has warned that newly imposed trade tariffs could reduce the carmaker's earnings by 1 billion euros this year, due to escalating trade tensions across China, Europe, and the U.S. Despite these challenges, BMW is maintaining an optimistic forecast of a 5-7% earnings margin for its car segment in 2025.

The premium carmaker is facing the threat of additional tariffs from both the EU and the U.S., particularly as it is the highest automotive exporter by value from the U.S., with over half of its German-made vehicles being exported outside the EU. Even so, executives have expressed optimism, expecting the tariffs to be temporary.

BMW's net profit dipped significantly in 2024, aligned with market expectations, due to struggles with sales in China and Germany, and delivery delays caused by brake problems. Despite the operational costs peaking, BMW has no plans for European workforce cuts, focusing instead on sustaining its strategic production setup.

(With inputs from agencies.)