Bmw revises 2024 estimates downwards

German car manufacturer Bmw has been forced to reduce its annual targets. The announcement in a press release issued by the company today. The cause is said to be a defective integrated brake system (Ibs), which has led to the recall and discontinuation of deliveries of 1.5 million vehicles. According to the press release, vehicle deliveries are expected to decrease 'slightly' in 2024 compared to the previous year, affecting the company's profitability. The operating margin of the automotive division, the group's flagship division, is expected to be between 6% and 7%, compared to the previous 8%-10%.

At the same time, the release explained, 'steadily declining demand in China is affecting sales volumes. Despite government stimulus measures, consumer sentiment remains weak'. Meanwhile, on the stock market, Bmw's share price fell by more than 8 per cent following the announcement.

In particular, Bmw expects a "negative effect on global sales in the second half of the year" due to the delivery freeze, while the Ibs-related problems impact 1.5 million vehicles with additional warranty costs estimated at over EUR 100 million. Hence the estimate of a 'significant drop in pre-tax profit'.