BMW’S cost cutting measures have begun to gain traction as the German premium automaker posted a better-than-expected 2009 profit despite lower vehicle production.
BMW said yesterday its pre-tax profit rose 18 per cent to €413m (£375m), easily beating the €253m forecast by analysts, even though car production fell 13 per cent during the same period.
“We are cautiously optimistic going into the new year,” chief executive Norbert Reithofer said, adding new models and demand in markets such as China and Brazil would continue to drive sales growth.
BMW’s earnings surpassed those of rival Mercedes-Benz but were behind those of Bavarian competitor Audi, which benefits from the economies of scale at parent company Volkswagen.
This becomes increasingly important as premium carmakers are forced to move downmarket, offering smaller, less lucrative models and engines needed to cut their carbon footprint ahead of ever-stricter emission regulations.
Net profit sank 47 per cent to €210m. It was the group’s lowest annual net income since a €2.5bn loss in 1999 but the figure beat analyst expectations of €174m.
The German carmaker said it had a loss before interest and taxes in the automotive segment but a profit before interest and taxes of €93m in the fourth quarter.
BMW has forecast group retail volumes would grow by a single-digit percentage rate this year to over 1.3m vehicles thanks in part to a raft of new models, including the 5 Series saloon that hits dealerships this month and the September debut of the Mini Countryman SUV.