BMW Group expects profitable growth in 2023 through dynamic BEV ramp-up, high-end premium segment

The BMW Group aims to exceed the total of 10 million fully-electric vehicles delivered to customers by 2030. An important milestone on this journey is expected in 2025, when the milestone of two million fully electric vehicles is likely to be passed.

BMW Group is looking ahead to financial year 2023, with tailwinds from last year’s success — based on highly attractive and technologically outstanding products. The company is taking this momentum into the home straight as it prepares for the launch of its next product generation, the NEUE KLASSE, in two years. The proven strengths of the present and the focus on future-oriented technologies will lay the foundation for the success of this future product generation, the company said.

The main growth drivers in 2023 will be fully-electric (BEV) vehicles and models from the high-end premium segment — such as the new BMW 7 Series, the updated BMW X7, and the Rolls-Royce model family. In this upper segment, the BMW Group expects growth in the mid-double-digit percentage range for the current financial year, with BEV models even likely to grow in the high double-digit percentage range. Overall, the BMW Group expects its deliveries to customers worldwide to increase slightly in the Automotive Segment in 2023.

The BMW Group is striving for a high level of profitability in its core business and is targeting an  EBIT margin of 8-10%in the Automotive Segment for the financial year. It should be noted that since the full consolidation of BMW Brilliance Automotive, the EBIT margin is no longer directly comparable with competitors.

“The BMW Group shows high resilience, especially under challenging conditions. The company anticipates developments in the economic environment at an early stage and takes action accordingly,” said Oliver Zipse, Chairman of the Board of Management of BMW AG, in Munich, on Wednesday. “A high level of flexibility, combined with our operational performance, proved to be an effective combination for ensuring the success of the BMW Group, even in the face of headwinds and taking advantage of opportunities for profitable growth.”

“The BMW Group is proving that it can do both — manage the company’s biggest transformation while maintaining its profitability. Our extremely strong product portfolio, in particular our impressive range of electrified vehicles and luxury-class models, makes both possible for us,” said Nicolas Peter, member of the Board of Management of BMW AG responsible for Finance. “We generate the expenditure for innovations from current cash flow. As before, our BMW approach remains focused on the profitable and sustainable future of the company.”

BEV share to be 15%: In the past year, the BMW Group more than doubled its BEV sales to over 215,000 units, underlining its role as a pioneer in e-mobility. In the first two months of the year, the BMW Group was able to more than double its sales of fully-electric vehicles, compared to the same period of the previous year, the release said. “Substance is convincing — and this is where our models speak for themselves. That is why we are striving for further significant growth in fully-electric vehicles this year and expect them to account for 15% of our total sales,” Zipse said.

With its range of around a dozen fully electric models already on offer, the BMW Group anticipates a steep growth trajectory in the coming years: In 2024, at least one in five of the company’s new cars will have a fully-electric drivetrain; by 2025; every fourth new vehicle delivered should be a BEV and, by 2026, around one in three.

The BMW Group aims to exceed the total of 10 million fully-electric vehicles delivered to customers by 2030. An important milestone on this journey is expected in 2025, when the milestone of two million fully electric vehicles is likely to be passed.

“Proven strengths, future-oriented technologies and the NEUE KLASSE — that is our recipe for success in the coming years. With this combination, we are in the right position to be able to respond precisely to different developments in the various regions of the world,” said Zipse.

The BMW Group continues to assume that not all markets worldwide will have the necessary framework conditions for all customers to switch to pure electromobility in the next decade. A growing percentage of the drivetrain mix is also likely to be provided by hydrogen fuel cells from the second half of this decade.

The BMW Group met its targets for 2022 and delivered a strong operating performance in a difficult business environment. This positive development can be attributed to improved pricing and positive product-mix effects, as well as the full consolidation of the Chinese joint venture, BMW Brilliance Automotive Ltd. (BBA). The BMW Group once again outperformed its main financial key figures for the previous year, reporting significant growth in revenues, Group earnings and net profit, the release said.

As expected, deliveries were slightly lower than the previous year, at 2,399,632 units (previous year: 2,521,514 vehicles/ -4.8%). Consistently high customer demand was reflected in the company’s strong order book. However, this could not be entirely fulfilled, due to difficulties with the supply of semiconductor components, supply chain disruptions and COVID lockdowns in China. Electrified vehicles –BEVs and PHEVs –accounted for a total of 18.1% (433,792 units/ +32.1% YoY) of deliveries.

Group revenues climbed to EUR 142,610 million (prev. yr.: EUR 111,239 million/+28.2%), with integration of BBA revenues making a significant contribution to growth. The BMW Group also benefited from improved pricing – for both new vehicle sales and the resale of end-of-lease vehicles – as well as positive product-mix effects. The increase in costs for materials, commodities and logistics, higher refinancing costs due to higher interest levels, as well as effects from the consolidation of BBA and a larger percentage of electrified vehicles, all contributed to higher costs.