BMW has dealt a serious blow to investors by announcing a large-scale brake recall that will affect over 1.5 million vehicles globally. This indicates that the company faces financial losses exceeding €500 million (approximately $550 million). Additionally, BMW indicated that the sales stop orders would have a 'negative impact on global sales in the second half of the year.' If that wasn’t bad enough, BMW also cited 'weak demand in China' as well as low consumer sentiment.
Given all these developments, BMW now expects a slight decline in sales this year instead of a modest increase. The automaker has also lowered its pre-tax profit expectations to 6%.
Unfortunately, the issues are not just on the automotive side, as BMW is facing a 'continuing competitive situation in core markets' including the United States and China. The company stated that this has a 'significant impact on volume and prices,' which is likely to lead to flat sales this year.
BMW kept the big news until the end, revealing that group pre-tax profits would 'decline significantly.' The company had already expected a 'slight decline', but matters have worsened significantly since that forecast. These developments helped push BMW's share price down to $77.10, representing a decrease of 11.43%.
Senior Writer The quest for automotive knowledge began as soon as the earliest memories. Various sources information, even questionable ones, have been explored including video games, television, magazines, or even internet forums. Still stuck in that rabbit hole.
