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The BMW logo is visible during the second press day of the Paris Auto Show, Paris, October 3, 2018. REUTERS / Regis Duvignau
FRANKFURT (Reuters) – The German manufacturer BMW (BMWG.DE) Wednesday announced a 27% decline in operating profit in the third quarter, to 1.75 billion euros, exceeding analysts' expectations in the face of foreign exchange difficulties and higher research and development spending.
Analysts in a Reuters poll were averaging a profit before interest and taxes (EBIT) of 1.795 billion euros.
BMW said that despite a slight increase in luxury car deliveries, the automotive division's operational return on sales was down to 4.4 percent from 8.6 percent a year earlier, well below its range. target of 8 to 10%.
Profits were affected by higher raw material prices, currency effects, higher provisions for goodwill and guarantee measures, tariffs between China and the United States, and a war prices in Europe, said the automaker.
Last month, BMW had announced that its pre-tax profit would fall this year, compared to its previous expectations, and that it would reduce its profit margin forecast for cars, charging intense price competition.
($ 1 = 0.8747 euros)
Report by Edward Taylor, edited by Riham Alkousaa
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