The Bayerische Motoren Werke AG (BMW) announced last Wednesday that its pretax profit this year was set to rise above the 4.12 billion euros it posted in 2006 on the sentiment that its car sales would also rise.
Norbert Reithofer, the chief executive of BMW, said the company planned "to beat the record pretax profit achieved in 2006." Last week, the automaker reported a 26 percent increase in 2006 pretax profit - from 3.29 billion euros ($4.35 billion) in 2005 to 4.12 billion euros ($5.45 billion) in 2006.
BMW also reported 28 percent increase in net profit to 2.87 billion euros ($3.79 billion). The profit boost was attributed to the one-time gain from the sale of a stake in Rolls-Royce PLC, the British aircraft engine maker.
Reithofer said that the rising euro and higher costs for the raw material it uses to make cars would "impact business performance for the current year, albeit to a lesser degree in the previous year."
Reithofer did not mention a specific forecast but in 2006, those issues injure the earning potentials of the automaker by about 844 million euros ($1.12 billion). He said the company expects to report higher sales through the rest of 2007 in the upper single-digit percentage range. "We intend to sell more than 1.4 million vehicles," he added. "This year, we expect a moderate start, to be followed by strong increases mainly in the second half of the year."
BMW has several new models, including the 3-Series convertible, a retooled X5 and new versions of its 5- and 1-Series models. The 3-Series convertible, which has debuted at the North American International Auto Show (NAIAS) in Detroit in January this year, comes with a retractable hardtop with a power-operated three-piece steel roof, the iDrive with programmable memory keys, a twin-turbocharged 3.0-liter inline six-cylinder engine, direct injection, and a BMW cold air intake.
The BMW X5, on the other hand, is a mid-size luxury crossover SUV based on the E39 5 Series. The vehicle features all wheel drive and a line of straight-6 and V8 engines. The 3.0 L diesel engine is offered for the non-US models.
The updated E60/E61 5-Series features new front and rear bumpers, restyled front and rear headlights, a refreshed interior, and the addition of the new BMW Drive-By-Wire system. The 1-Series, on the other hand, introduces a 3-door sports hatch variant that is equipped with new front & rear bumpers and a modified vehicle interior.
By: Lauren Woods