Ladies and Gentlemen, good morning.
The increasingly formidable marketplace sourroundings in a third quarter
has impacted gain expansion opposite a whole automotive
industry, including during a BMW Group. In September, we therefore
practiced a foresee for 2018. In line with this new guidance,
gain for a initial 9 months are on lane to strech a goals for
Group gain before taxation for a year to a finish of September
totalled 7.88 billion euros. Although revoke than a prior year,
this is still a second-best nine-month outcome ever. The EBIT margin
of 7.6% in a Automotive Segment is also on march to accommodate our
practiced superintendence of during slightest 7% for a full year. We are tackling
a stream hurdles and concentrating on a handling business as
good as gearing adult for a future. The latter stays a comprehensive priority.
As formerly announced, we will be investing a sum of around one
billion euros some-more in investigate and expansion of new technologies
this year. As communicated during a commencement of a year, a RD
ratio increasing to 6.9% in a third quarter. We knew from a start
that 2018 was never going to be easy.
In serve to high upfront investments in destiny projects, we are
also confronting banking and commodity headwinds in a high
three-digit-million range, as expected. These already challenging
conditions strong even serve over a march of a summer. The
WLTP transition has thrown a European marketplace totally off balance.
We had a vehicles approved early, forward of a deadline – though have
still not been means to besiege ourselves from a altogether marketplace development.
We done a unwavering preference early on not to follow each cost war.
The BMW Group responded immediately to these changes, and we adjusted
a prolongation volumes accordingly. Thanks to this clever planning,
we were means to revoke a inventories by scarcely 20,000 units in the
The trade brawl between a US and China is straining a global
economy. With opposite prolongation locations worldwide, not all
competitors are equally affected. The flighty trade conditions also
unsettled business in a third quarter. As formerly announced, we
have increasing a supplies for guaranty costs and goodwill
significantly to safeguard that we are reasonably lonesome in this
area. On a cost side, we began implementing countermeasures early
on. In serve to prioritising some-more strictly, we also motionless on a
series of brief and long-term measures in new months.
In light of a hurdles we referred to, additional efforts will be
indispensable to support a profitability targets. Let’s take a demeanour during the
Group financial statements for a initial 9 months in some-more detail.
Revenues for a year to a finish of Sep totalled 72.46 billion
euros – somewhat revoke than a prior year, due to currency
translation. Adjusted for this effect, revenues rose by 1.5%.
In perspective of a factors we only mentioned, pre-tax gain were in
line with a expectations, reaching 7.88 billion euros during a finish of
September. The figure for a third entertain was 1.85 billion euros.
Regardless of these severe outmost conditions, a BMW Group
stays on march for a future. Upfront investments in continued
expansion of e-mobility and unconstrained pushing will be essential for
Research and expansion output for a year to a finish of
Sep increasing accordingly to around 4.45 billion euros, as
planned. The RD costs recognized in a income matter were
scarcely 400 million euros aloft year-on-year.
The RD ratio for a initial 3 buliding rose to 6.1%. Capital
output for a same duration reached 2.89 billion euros, with a
capex ratio of 4.0%. This especially reflects product and structural
investments for a new X3, as good as preparations for a launch of
a X5 and a X7. As planned, collateral output will boost once
again in a fourth quarter, with a start of prolongation of a new 3
Series and 8 Series models. At Group level, a EBT domain currently
stands during 10.9%.
Let’s take a brief demeanour during a sold segments. The Automotive
shred saw a slight boost in deliveries in a initial 9 months
of 2018 to some-more than 1.83 million vehicles. Adjusted for currency
interpretation effects, shred revenues rose somewhat by 2.9%. The
unadjusted figure was on a standard with a prior year during around 62.63
Here, we are also feeling a effects of a formidable pricing
conditions in Europe due to a WLTP transition. Higher losses for
guaranty and goodwill activities have lifted a cost of sales. As
formerly mentioned, RD costs will also be significantly higher
than a prior year. Higher tariffs, ensuing from a current
trade tensions, have put gain underneath serve pressure. The
Automotive Segment’s handling gain for a third quarter
decreased to 930 million euros. As a result, a figure for a year
to a finish of Sep was also lower, during 4.73 billion euros. As I
already mentioned, a EBIT domain of 7.6% for a year to a finish of
Sep is in line with a new guidance.
The financial outcome benefited from a BBA corner try business in
China, that increasing by 11.7% year-on-year. Pre-tax gain in the
Automotive Segment totalled 5.35 billion euros for a initial nine
months of 2018.
Let me contend a few difference about a money upsurge statement: Our giveaway cash
upsurge especially reflects revoke profits. For a year to a finish of
September, it but amounted to around 2.04 billion euros.
In a third quarter, giveaway money upsurge amounted to about 100 million
euros. Despite a formidable conditions, we are still targeting a free
money upsurge of 3 billion euros for a full year. But here we must
emphasize: In light of a stream hurdles this will not be an easy task.
In a Financial Services Segment, a business with sell customers
continues to perform well. At a finish of a third quarter, we managed
a sum of 5.14 million contracts: This is 4.4% some-more than during a start
of a year. China, in particular, posted poignant expansion of almost
17% in a sum agreement portfolio. The series of new financing
contracts rose significantly in a third quarter, with a slight
boost on a leasing side. At 1.7 billion euros, pre-tax earnings
for Jan to Sep were somewhat revoke year-on-year – reflecting
a disastrous impact of banking interpretation effects, among other
factors. As expected, a risk conditions remained fast overall. In
Europe, as in a prior quarter, residual values trended slightly
downwards in a series of markets. In North America, on a other hand,
used automobile prices done a slight recovery. In Asia, we continue to see
Let’s pierce on fast to a Motorcycles Segment. Despite a model
changeover in a mid-size class, deliveries remained during a same high
turn as a prior year. Operating gain were during 208 million
euros. The EBIT domain was 12.5%.
Ladies and Gentlemen,
Conditions sojourn severe for a automotive industry. Trade
barriers, a transition to WLTP, a discuss over emissions and their
sold levels – all these factors are hampering a business
environment. The BMW Group responded promptly, of course, and has
launched both brief and long-term measures within a company. We are
strengthening a sales side with targeted programmes.
At a same time, we are stepping adult countermeasures on a cost
side. Thanks to a stretchable general prolongation complement and high
turn of ability utilisation, we are means to adjust fast to new
situations. We are examination trade developments, in particular, very
closely. If conditions mellow significantly, effects on our
superintendence can't be ruled out.
Against this background, a opinion for a full year is as follows:
Group gain before taxation are approaching to uncover a assuage decrease
from a high turn of a prior year. This practiced opinion does
not simulate any certain gain effects that might result, should the
designed mobility services corner try accept regulatory approval
and tighten in 2018. In a Automotive Segment, deliveries are expected
to be somewhat aloft than a prior year, with an EBIT domain of
during slightest 7%. Revenues are now foresee to be somewhat lower
year-on-year. In a Motorcycles Segment, we should see a slight
boost in deliveries, with an EBIT domain in a operation of 8-10%.
And, in a Financial Services Segment, we are aiming for a lapse on
equity above a aim figure of 14%.
Ladies and Gentlemen,
You know that a BMW Group has always been arguable and transparent.
We sojourn loyal to a values even in these severe times. We
plainly acknowledge risks and take suitable action. We are confronting a
rarely flighty sourroundings as we enter a final entertain of a year.
We can't order out that several of a factors we mentioned may
continue to impact a business over 2018.
However, we will see certain procedure subsequent year from a rejuvenated
product line-up. There will be new generations of several pivotal models.
At a finish of a year, a plants will be ramping adult a inheritor to
a successful 3 Series. Further 8 Series models will also go into
prolongation before a finish of a year. In new months, a new X3
has also successfully ramped adult during 3 apart plants. With a X5
and X7, we have dual some-more vehicles with high grant margins ready
to go. We design these to give us uninformed movement in a subsequent year. The
whole automotive attention is now confronted with severe conditions.
The BMW Group is, and will remain, a high-performance company. Even
in violent times, we never remove steer of a long-term goals and
continue to stay a course.