Munich’s BMW raises annual profit forecast as higher prices ease chip shortage frets



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Munich’s BMW raises annual profit forecast as higher prices ease chip shortage frets

BMW or Bayerische Motoren Werke AG, the Munich-based German multinational manufacturer of wide-ranging luxury vehicles with high-profile subsidiaries like of BMW Motorrad alongside Rolls-Royce Motor Cars among others, had raised its full-year profit margin forecast between 9.5 per cent to 10.5 per cent from a prior range of 7.0 per cent to 9.0 per cent, as a price hike in new and used vehicles appears to have eclipsed a global-scale supply chain constrain, the German automaker had said in an ab lib statement on Thursday.

Aside from that, BMW AG had added in the statement that the automaker which employs as many as 133,778 workers as of early-2020 and reported a revenue of €98.99 billion as of December 31, 2020, was expecting a raise in return in financial services segment including equities between 20.0 per cent to 23.0 per cent compared to a prior projection of 17.0 per cent to 20.0 per cent, while the Munich-based carmaker had projected a free cash flow of an approximated €6.5 billion at its automobile segment.

Meanwhile, expressing a through-and-through optimism over a sustenance in positive pricing, BMW AG said in a statement, “Whilst the semiconductor supply restrictions are expected to further impact production and deliveries to customers in the coming months, BMW AG expects that the continuing positive pricing effects for both new and pre-owned vehicles will overcompensate these negative sales volume effects in the current financial year”.

BMW AG raises annual profit margin forecast

In point of fact, latest raise in BMW AG’s full-year profit margin forecast came against a baleful backdrop in global auto industry, much of which had been languishing for months amid a chronic chip shortage with a swathe of big-league carmakers ranging from French Renault to Japan’s Toyota to S.

Korea’s Hyundai raising an alarming bell over a long-term hit in outputs, however, price hikes had enabled a few carmakers to curb out some of their losses, industry analysts were quoted saying following BMW AG statement.

Nonetheless, Frankfurt-listed shares’ prices of BMW AG was foundered 2.02 per cent to €82.76 a share following the statement.