BMW initiates the recall of approximately 1.5 million vehicles and revises its profit projections downward.
BMW predicts that technical glitches will result in "negative sales impact globally in the second half of the year." Extra expenses estimated to be in the "high tens of millions" are projected for Q3.
The lingering lethargic interest in China is impacting sales within the region, BMW added. Even with administrative aid, "consumer reluctance persists."
Consequently, BMW has revised its outlook for its 2024 fiscal year. Instead of a minimal drop, the company now anticipates a "substantial decrease" in pre-tax earnings. Furthermore, BMW now predicts a slight dip in deliveries compared to the previous year, contrasting its earlier projection of a minor rise.
Moreover, the bike market is "congested and intense," especially in the USA and China. This situation implies that deliveries will remain at the 2023 level, as opposed to the earlier prediction of a slight growth.
Given the challenges in the Chinese market, BMW has decided to temporarily halt its expansion plans in China until the situation improves. The ongoing economic instability in China is expected to continue impacting BMW's sales in the region.
