BMW's 2024 Net Profit Falls 37% to 7.68 Billion Euros, Cites Weak China Demand and Recall of 1.5 Million Vehicles

BMW AG reported a significant decline in its annual net profit for 2024, dropping by 37% to 7.68 billion euros from the previous year. The company attributed this sharp decrease to weakened demand in China, its largest market, and issues with brake systems supplied by Continental that led to delivery delays and a recall of 1.5 million vehicles. The German automaker's revenue also fell by 8.4% to 142.4 billion euros, reflecting a 4% decrease in vehicle sales to 2.5 million units. The downturn was exacerbated by a 13.4% drop in sales in China, where BMW earns nearly a third of its revenue. Electric vehicle sales accounted for 17% of total sales in 2024. BMW's fourth-quarter results showed sales of 36.42 billion euros, missing market expectations of 41.23 billion euros. Earnings before interest and taxes (EBIT) for the quarter were 1.88 billion euros, a 57% year-over-year decline, compared to an estimated 2.67 billion euros. For the full year, EBIT dropped by 35.8% to 11 billion euros, with the automotive EBIT margin decreasing to 6.3% from 9.8% the previous year. Looking ahead to 2025, BMW anticipates continued challenges due to escalating trade tensions with the U.S., which could impact deliveries, and increasing competition from Chinese electric vehicle manufacturers. The company expects its automotive EBIT margin for 2025 to be between 5% and 7%, lower than the estimated 6.65%.