European carmakers BMW and Stellantis have reported surging revenues, boosted by higher prices and strong demand for cars despite supply chain woes.
BMW’s third-quarter sales rose by just over a third to €37.2bn, with the company pointing to strong sales in China.
“Contributing to this were solid pricing for new and used cars, a favourable product mix and, in particular, revenues from the Chinese joint venture,” the company said on Thursday.
BMW’s Chinese partnership was set up in 2003 and the company announced this year that the tie-up, which was consolidated into BMW results this year, would be extended until 2040.
The German carmaker maintained its previous financial guidance for the full year, including a target of slightly lower sales than last year. It expected the number of cars delivered to customers to be flat compared to last year “despite the impact of global disruption to supply chains and Covid lockdowns in China”.
Last week, rival Volkswagen downgraded its delivery target for new cars citing a lack of parts, warning that supply chain bottlenecks were becoming the new normal.
Supply chain crunches and China’s zero-Covid policy were not the only dark cloud on BMW’s horizon. The company warned that high inflation and interest rate increases were starting to erode consumer sentiment, which would “impact their purchasing behaviour in the coming months”.
BMW’s unusually high backlog of orders, a remnant from pent-up demand following the pandemic, was therefore “expected to normalise, especially in Europe”.
The company said it did not expect energy shortages to hamper production “this year” but added that energy and raw material costs were likely to remain at a “high level” for the rest of the year.
BMW’s earnings before interest and tax jumped 28 per cent to €3.68bn, compared with the same period last year. Its share price, which has dwindled by roughly 15 per cent this year, was down 3 per cent on Thursday morning.
Stellantis, the owner of Jeep and Peugeot, said sales in the third quarter climbed 29 per cent to €42.1bn.
Vehicle deliveries rose 13 per cent to 1.3mn compared with a year earlier, as shortages of semiconductors it faced a year ago began to ease, while sales of its battery electric models rose 41 per cent against a year earlier.