BERLIN, Nov 3 (Reuters) – BMW (BMWG.DE) beat analysts’ forecasts on Wednesday with a 42.4% increase in third quarter net profits to 2.58 billion euros ($2.99 billion) as higher prices and strong electric vehicle (EV) sales offset lower deliveries due to scarce chips.
In an earnings call, finance chief Nicolas Peter said the company was confident of topping its target for a 10% margin on pre-tax earnings this year, though the fourth quarter could be slightly dampened by higher tax payments and investment costs.
Looking ahead, the company expects strong EV sales to carry into 2022, Peter said.
While rising raw material prices impacted earnings this year, the company’s strong relationship with suppliers has cushioned the blow, CEO Oliver Zipse said.
NO CHIPS, NO PROBLEM?
BMW’s deliveries fell 12.2% in the third quarter but revenues were still up by 4.5%. EVs in particular saw a significant boost, with sales in the nine months to September almost double last year’s levels at just under 232,000 vehicles.
“A better product mix and good price setting of new vehicles alongside a stable pricing trend of used vehicles strengthened the financial performance of the business,” a company statement said.
The finance chief said earlier this year the company expected to deliver up to 90,000 fewer cars in 2021 because of a lack of chips.
“We are on track for our full-year forecast and are looking forward,” Peter said. “We expect that semiconductor supply will be in an issue for us beyond 2021.”