Berlin, Germany — BMW shares were expected to be down 3% in pre-market indications on Wednesday, after the German carmaker cut its 2025 earnings forecast due to changed US tariff assumptions and weaker-than-expected growth in the Chinese market.
The company narrowed its profit forecast to 5%-6% in its cars business from the 5%-7% range it had previously predicted, while pretax earnings were likely to decline slightly this year.
Citing delays to refunds from US customs, BMW also halved expectations for the automotive segment’s free cash flow to more than €2.5bn.
The carmaker, which still assumes the EU will retroactively implement a tariff reduction to zero, now expects a three-digit million figure in reimbursements next year, it said.
Like its European peers, BMW has suffered setbacks in China due to aggressive local competition and a real-estate downturn.
While BMW recorded sales growth in Europe and the US through the end of September, the targeted sales increase in China remained below expectations, the company said.
“We believe that, more important than the impact of tariffs, will be the firm’s ability to stabilise the volume momentum and pricing power in China in financial year 2026, which will ultimately ensure the longer term competitiveness of the group,” wrote JPMorgan analysts.
Local rival Mercedes, which on Tuesday reported declining sales as US import duties and intensifying competition in China dented its sales, saw shares down 2.7% in early Frankfurt trade on Wednesday.
Reuters
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