Free cash flow of € 2.5 billion. Ebit margin of 9.8%. The chip crisis does not affect BMW, unlike other manufacturers such as Ford, Renault and Volkswagen. The Munich manufacturer confirms its targets for 2021 even in spite of the increase in raw material costs. BMW is known for its strong relationships with suppliers and has worked with them to avoid disruption. The only problem encountered was a temporary shutdown of the Minis’ production in the UK. The forecast, in Munich, is that supply and demand will return to balance within two years at the latest.
As for the performance in the first quarter, sales of electrified vehicle models (BMW expects to have 2 million fully electric cars on the road by 2025) more than doubled in the first quarter, despite higher prices and thanks to strong demand in China. . BMW had already recorded a 370% increase in pre-tax profit as it recovered better than expected from a first quarter devastated by last year’s pandemic. The pre-tax margin for the automotive core business is now expected in 2021 at the upper limit of the previous estimate of between 6% and 8%.
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BMW also saw solid first quarter growth in other regions, including a 17.4% sales increase in North America, driven by strong demand from US drivers. “The first quarter shows that our global business model is successful, even in times of crisis – said managing director Oliver Zipse in a statement -. We remain firmly on track for continued, sustainable and profitable growth. Our strategy is based on maintaining a strong focus on providing attractive high-tech products that are set to shape the evolving world of mobility. “
The German automaker said first-quarter results also received a boost from the sale of previously leased vehicles, particularly in the US market.