BMW's profits up 12.1% in first quarter

On Thursday, BMW reported an earnings margin of 12.1% in the first quarter of 2023, up from 8.9% a year earlier, confirming its outlook for 2023 but warning of ongoing high costs and rising competition, particularly in China.

The carmaker attributed a drop in Group earnings before tax - 5.1 billion euros, or $5.65 billion, from 122 billion last year - to the one-time effects of the full consolidation of its Chinese joint venture, BMW Brilliance Automotive.

The situation of the geopolitical and macroeconomic state remains unguarded and tense. Inflation and interest rates in key markets are high. The exact same applies to material and commodity prices, said Nicolas Peter, chief financial officer.

Sales were down 1.9% in Europe and 6.6% in China, attributed to inflation and the after-effects of the coronavirus pandemic, but an upward trend was visible in March and April.

The carmaker continues to expect some growth in Europe, robust sales in the United States, and a stabilizing economy in China.

In contrast to other carmakers like Porsche, BMW's financing and leasing business suffered due to persistently high interest rates and price hikes, with the volume of new business falling 14% and earnings down 62%.