BMW will weed out its model lineup to reduce costs as the German luxury carmaker copes with a cooling global economy and persistent trade tensions that show little sign of resolution.
“The challenges facing the entire sector are unlikely to diminish in the coming months,” chief executive Harald Krueger said Friday in a statement presenting preliminary results. “Great efforts will, therefore, be needed across the entire group to help shape the sector’s transformation under such conditions.”
BMW earnings have been pressured by tariffs on cars made at its plant in Spartanburg, South Carolina, and sent to China, as well as price competition in Europe. Carmakers across the globe reduced targets last year after new emissions testing and concerns over Brexit added to the industry’s woes. BMW’s return on sales in the core automotive division dropped to 7.2 per cent from 9.2 per cent in 2017, below a historical 8 per cent to 10 per cent range.
BMW said it won’t make a successor to the 3-Series Gran Turismo, even though the current model is selling well. More derivative versions will also be cut. The carmaker said it will also step up other measures to reduce complexity, without specifying them. BMW cut its proposed dividend by 50 cents to 3.50 euros per common share.
Carmakers aren’t “supermarkets, there is no good reason to sell everything,” said Juergen Pieper, an analyst at Bankhaus Metzler. Cutting the models was “the right way,” he said. “Nobody will miss them.”
The shares rose 1.3 per cent to 74.75 euros at 12:25 pm in Frankfurt, trimming losses over the past year to 8.2 per cent. BMW’s return on automaking beat the company’s goal of 7 percent.
Other carmakers are chiming in with cost cuts. Volkswagen AG brand Audi will present a new plan in May to reignite momentum, including trimming back management ranks for savings and faster decision-making. Mercedes Benz-parent Daimler vowed comprehensive cost-cutting measures last month when the company presented its full-year earnings.
Since the second half of last year, major markets including China and Europe have deteriorated further. BMW reiterated a January prediction for a rise in deliveries this year, though sales have dropped 2 percent through February as the European market declined for a sixth straight month.
BMW has joined forces with arch-rival Daimler AG in two key areas, car-sharing and autonomous driving, in a bid to share costs.
The company will present full earnings on March 20, including its outlook for the current year. BMW is likely to guide for pre-tax earnings to decrease slightly, Evercore ISI analyst Arndt Ellinghorst said in a note.
Specs
Engine: Duel electric motors
Power: 659hp
Torque: 1075Nm
On sale: Available for pre-order now
Price: On request
Tax authority targets shisha levy evasion
The Federal Tax Authority will track shisha imports with electronic markers to protect customers and ensure levies have been paid.
Khalid Ali Al Bustani, director of the tax authority, on Sunday said the move is to "prevent tax evasion and support the authority’s tax collection efforts".
The scheme’s first phase, which came into effect on 1st January, 2019, covers all types of imported and domestically produced and distributed cigarettes. As of May 1, importing any type of cigarettes without the digital marks will be prohibited.
He said the latest phase will see imported and locally produced shisha tobacco tracked by the final quarter of this year.
"The FTA also maintains ongoing communication with concerned companies, to help them adapt their systems to meet our requirements and coordinate between all parties involved," he said.
As with cigarettes, shisha was hit with a 100 per cent tax in October 2017, though manufacturers and cafes absorbed some of the costs to prevent prices doubling.
Federer's 11 Wimbledon finals
2003 Beat Mark Philippoussis
2004 Beat Andy Roddick
2005 Beat Andy Roddick
2006 Beat Rafael Nadal
2007 Beat Rafael Nadal
2008 Lost to Rafael Nadal
2009 Beat Andy Roddick
2012 Beat Andy Murray
2014 Lost to Novak Djokovic
2015 Lost to Novak Djokovic
2017 Beat Marin Cilic
RESULT
Esperance de Tunis 1 Guadalajara 1
(Esperance won 6-5 on penalties)
Esperance: Belaili 38’
Guadalajara: Sandoval 5’
Our legal advisor
Rasmi Ragy is a senior counsel at Charles Russell Speechlys, a law firm headquartered in London with offices in Europe, the Middle East and Hong Kong.
Experience: Prosecutor in Egypt with more than 40 years experience across the GCC.
Education: Ain Shams University, Egypt, in 1978.
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Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
The biog
Name: Capt Shadia Khasif
Position: Head of the Criminal Registration Department at Hatta police
Family: Five sons and three daughters
The first female investigator in Hatta.
Role Model: Father
She believes that there is a solution to every problem
2025 Fifa Club World Cup groups
Group A: Palmeiras, Porto, Al Ahly, Inter Miami.
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Group C: Bayern Munich, Auckland City, Boca Juniors, Benfica.
Group D: Flamengo, ES Tunis, Chelsea, (Leon banned).
Group E: River Plate, Urawa, Monterrey, Inter Milan.
Group F: Fluminense, Borussia Dortmund, Ulsan, Mamelodi Sundowns.
Group G: Manchester City, Wydad, Al Ain, Juventus.
Group H: Real Madrid, Al Hilal, Pachuca, Salzburg.
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- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
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T20 World Cup Qualifier, Muscat
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Avengers: Endgame
Directors: Anthony Russo, Joe Russo
Starring: Robert Downey Jr, Chris Evans, Scarlett Johansson, Chris Hemsworth, Josh Brolin
4/5 stars
Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
The specs
Engine: 4.0-litre flat-six
Torque: 450Nm at 6,100rpm
Transmission: 7-speed PDK auto or 6-speed manual
Fuel economy, combined: 13.8L/100km
On sale: Available to order now
MATCH INFO
Watford 2 (Sarr 50', Deeney 54' pen)
Manchester United 0
MATCH INFO
Uefa Champions League quarter-final, second leg (first-leg score):
Manchester City (0) v Tottenham Hotspur (1), Wednesday, 11pm UAE
Match is on BeIN Sports
The Freedom Artist
By Ben Okri (Head of Zeus)
Royal Birkdale Golf Course
Location: Southport, Merseyside, England
Established: 1889
Type: Private
Total holes: 18
RESULT
Brazil 2 Croatia 0
Brazil: Neymar (69'), Firmino (90' 3)
