+++ The BMW GROUP has achieved its business objectives for financial year 2023, as forecasted. Despite strong competition and volatile conditions, the company maintained its profitable growth and defended its leading position in the global premium segment. A total of 2.554.183 vehicles were delivered to customers in the year to the end of December (2022: 2.399.632 units / +6.4%), including 717.620 units in the 4th quarter (2022: 651.794 units / +10.1%). Deliveries for the full year had a solid increase, resulting in a market share of 3.3%. High demand for its products was the driver for the BMW Group’s strong financial performance: The EBT margin came in at 11.0% (2022: 16.5%; Q4: 8.6%; 2022: 8.2%), above the strategic target of 10%. The EBIT margin in the Automotive Segment of 9.8% (2022: 8.6%; Q4: 8.5%; Q4 2022: 8.5%) was within the forecast target range of 9.5-10.0%. Throughout 2023, the BMW Group has delivered a total of 375.716 fully-electric cars (2022: 215.752 units / +74,1%) to customers, achieving a share of around 15% of total sales, as planned. Including the PHEVs delivered, the BMW Group sold a total of 565.875 electrified vehicles (2022: 433.792 units / +30.5%) and thus achieved a sales share of 22%. Group revenues climbed to €155.498 million (2022: €142.610 million / +9.0% / adjusted for currency translation effects: +13.1%). The company’s full-year earnings before financial result (EBIT) reflected the BMW Group’s strong operating performance: In 2023, EBIT climbed to €18.482 million(2022: €13.999 million / +32.0%). Between January and December, the BMW Group reported pre-tax earnings (EBT) of €17.096 million (2022: €23.509 million / -27.3%). Here, the negative fair value driven financial result of -€1.386 million (2022: €9.510 million) reflects a corresponding base effect: In the prior year, the revaluation of BBA equity interests of €7.7 billion, as part of the full consolidation, had significantly increased the BMW Group’s financial result, Group earnings and Group net profit. The EBT margin for January to December came in at 11.0% (2022: 16.5%). Group net profit for the 12-month period amounted to €12.165 million (2022: €18.582 million / -34.5%). Without the one-time revaluation effect, Group net profit would have been higher year-on-year, with an EBT margin on par with the previous year. In the Automotive Segment, full integration of the operating business of BMW Brilliance Automotive (BBA), higher sales volumes and positive product mix effects boosted revenues for the 12-month period by 7.0% to €132.277 million (2022: €123.602 million / adjusted for currency translation effects: +11.3%), as did higher revenues from aftersales business. Negative currency translation effects, primarily from the Chinese renminbi and the US dollar, impacted revenue growth: Excluding these headwinds, revenues saw a significant increase of 11.3% for the full year. Depreciation and amortisation from the purchase price allocation in connection with the full consolidation of about € 1.4 billion impacted the segment’s cost of sales for the full year as well as a slight increase in sales and administrative costs. The Automotive Segment’s earnings before financial result (EBIT) for the full year were also significantly higher, at €12.981 million (2022: €10.635 million / +22.1%). A positive effect came from the full-year inclusion of the BBA result and from the net effect of volume, mix and pricing, driven by the higher sales volume and the higher share of top end as well as BMW M vehicles. However, headwinds resulted from higher research and development spending and increased manufacturing costs against 2022 as well as the higher share of electrified vehicles. The EBIT margin for this period was 9.8% (2022: 8.6%; +1.2 %-pts.). Excluding depreciation and amortisation for BBA assets from the purchase price allocation of € 1.4 billion previously referred to, the EBIT margin was 10.8%. Thanks to this positive earnings development, the segment’s free cash flow amounted to € 6.942 million at the end of December (2022: € 11.071 million / -37.3%). The previous year included the positive one-time effect of around € 5 billion from the full consolidation of BMW Brilliance. The BMW Group achieved growth in deliveries and a strong financial performance in the 4th quarter of 2023. It delivered 717.620 premium vehicles to customers (Q4 2022: 651.794 units / +10.1%), including 128.849 fully-electric vehicles (Q4 2022: 87.557 units / +47.1%). Group revenues saw a solid increase in the 4th quarter to reach € 42.968 million (2022: € 39.522 million / +8.7%). Group research and development costs were higher in the final quarter of the year, at € 2.080 million (Q4 2022: € 1.739 million / +19.7%). The R&D ratio (according to the German Commercial Code) was stable at 5.9% (Q4 2022: 5.8% / +0.1 %-pts.). The BMW Group’s capital expenditure totalled €3.758 million (2022: €3.111 million / +20.8%). Group earnings before financial result (EBIT) of €4.412 million (2022: € 3,500 million / +26.1%) were a lot higher year-on-year. Group earnings before tax (EBT) rose significantly in the fourth quarter to €3.682 million (2022: €3.253 million / + 13.2%). The EBT margin for this period was 8.6% (2022: 8.2%). Group net profit for the fourth quarter totalled €2.614 million (2022: €2.175 million / +20.2%). Automotive Segment revenues posted solid fourth-quarter growth to reach €37.283 million (2022: €34.571 million / +7.8%; adjusted for currency translation effects: +12.2%). Earnings before financial result (EBIT) showed solid growth in the fourth quarter to €3.171 million (2022: €2.932 million / +8.2%). The EBIT margin of 8.5% (2022: 8.5%) remained stable from the previous year, underlining the strong operating performance of the Automotive Segment in the final quarter of the year which showed the seasonally high cost burden. Solid earnings development in the Automotive Segment resulted in a free cash flow of €1.183 million in the 4th quarter (2022: €1.195 million / -1.0%). +++
+++ The United Kingdom will apply “robust measures” to ensure a level playing field for local car makers in the face of increased competition from CHINESE EV MANUFACTURERS , Mark Harper, secretary of state for transport, told the audience of the SMMT Connected event. The pressure has increased on the UK to respond to the EU’s toughened stance on subsidy-backed Chinese car makers. In March, the European Commission said it had evidence to show Chinese EVs were being supported directly by state subsidies following an investigation begun in October into Chinese car prices. The EU is widely expected to increase tariffs on Chinese cars. +++
+++ Electric vehicle startup FISKER has hired restructuring advisers to assist with a possible bankruptcy filing. The company has hired financial adviser FTI Consulting and the law firm Davis Polk to work on a potential bankruptcy filing, according to the report. Fisker’s stock price fell more than 40% in after-hours trading after the news was published. Overall, the stock is down more than 80% since the start of 2024. Earlier this month, Fisker flagged going-concern risks, job cuts and a pause in investments into future projects until it secures a partnership with a manufacturer. Nissan is in advanced talks to invest in Fisker in a deal that could provide the Japanese automaker with access to an electric pickup truck. +++
+++ JAPAN ’s Nissan and Honda have agreed to study the possibility of a partnership focused on electric vehicles, as the carmakers struggle to challenge the dominance of Chinese manufacturers. Nissan and Honda’s potential partnership will focus on technology that helps accelerate efforts towards “carbon neutrality and zero traffic-accident fatalities”, the carmakers said. The feasibility study will include components related to EVs and automotive software platforms, the companies said. “It is important to prepare for the increasing pace of transformation in mobility in the mid-to-long-term, and it is significant that we have reached this agreement based on a mutual understanding that Honda and Nissan face common challenges”, Nissan president and CEO Makoto Uchida said in a statement. “We look forward to further discussions and aim to find win-wins for sustainable growth”. Honda director and president Toshihiro Mibe said the criteria for their partnership would be “whether the synergy of the technologies and knowledge that our companies have cultivated will enable us to become industry leaders by creating new value for the automotive industry”. Nikkei Asia reported earlier that the carmakers could consider developing a common EV powertrain and shared EV platform. Both Nissan and Honda have struggled to keep up with their Chinese EV rivals in their home market, the world’s largest. Nissan’s output in China last fell 24 percent to about 793.000 vehicles, dropping below the 1 million mark for the first time in more than a decade. Honda has laid out plans to increase its ratio of electric vehicles and fuel cell vehicles to 100 percent of all sales by 2040. Nissan already cooperates with Renault on EVs, with its updated Micra to share the same architecture as the new 5 E-Tech and be assembled in the same plant in Douai. Chinese automakers account for more than 50 percent of the global market for EVs. +++
+++ LANCIA has confirmed the legendary HF badge will return next year for an electric hot hatch based on the new Ypsilon. The Italian brand said the Ypsilon HF will put out 240 hp, suggesting that it will use the same front-mounted motor as sibling brand Abarth’s 600e. The Ypsilon HF will also get a lower, wider suspension set-up and dispatch the 0-100 kph sprint in 5.8 seconds, Lancia said. Notably, that is quicker than the last HF-badged Lancia, the second-generation Delta HPE HF, which cracked 100 kph in 7.5 seconds. It is, however, slightly behind the legendary Delta HF Integrale Evo 2, which did the same sprint in 5.7 seconds. The new HF badge is a mix of the 1960s original (with the elephant mascot painted in the same shade of red used on the 1966 Fulvia Coupé HF) and that used through the 1990s, with italicised ‘HF’ script. Lancia CEO Luca Napolitano has now confirmed that the manufacturer is “working on” plans to return to rallying. A comeback in any capacity would almost certainly depend on the development of an electric formula for rallying, given the new Ypsilon is offered solely as an EV, and that the WRC recently announced a return to non-electrified powertrains. The FIA (world motorsport’s governing body) has, however, said an electric class will open “at the earliest opportunity”. Napolitano said: “After the presentation of the new Lancia Ypsilon, the first car of the brand-new era, today we take another step ahead in the path to Renaissance, to emphasise the brand’s most brutal and radical soul and its commitment to focusing on performance models”. Lancia is also reviving names from its glory days for the next 2 models it’s launching. Arriving in 2026 is the new Gamma flagship, a 4.7-metre-long fastback, followed by the new Delta in 2028 which Lancia is describing as “a sculpted and muscular car”. Both cars will be pure-electric and should use the new STLA platforms from parent company Stellantis. In case you’re wondering, the little galloping elephant has been used by Lancia since 1953 and in Eastern cultures symbolises good luck and victory. It’s also supposed to represent the unstoppable nature of Lancia’s performance cars. +++
+++ The Ghost might be ROLLS-ROYCE ’s smaller, “entry-level” car, but those words don’t mean much when referring to the storied British automaker. With an almost $350.000 starting price, the Ghost is nearly as exclusive as its larger counterparts, but the recently announced Prism model will be even harder to get. Rolls-Royce said it would produce just 120 units of the car to celebrate its 120th anniversary in 2024, though it’s unclear how many are already sold. As these things typically go, high-value clients and famous people tend to get the first crack at exclusive models, as they’re meant to be rolling advertisements for the brand. Last year was the brand’s best ever, as it moved more than 6,000 vehicles in 2023, with America and record growth in the Middle East leading the charge. The automaker’s demo car came in Gunmetal gray, which it said took 16 hours of hand polishing and a 10-step process that involves 4 layers of paint application. A high-gloss black-gray color is applied to the grille and trunk lid, which involves polishing the paints to such a high-gloss finish that they appear metallic. The dark colors highlighted with bolder hues are meant to convey the appearance of a prism, hence the car’s name. Buyers can choose between four accent colors: Forge Yellow, Mandarin, Phoenix Red, and Mandarin. The color is applied to the brake calipers, lower bumper inserts and coachline, which Rolls said is a styling element that ties together the “mechanical, aerodynamic, and sculptural elements of Ghost.” Inside, the car gets Rolls-Royce’s famous Starlight Headliner with 1,040 individual LED “stars” across the interior roof. While these exclusive features are selling points for the Ghose Prism, Rolls said buyers still get access to its entire catalog of colors, materials, and options. Most people extend the automaker’s already extreme purchase prices by several thousand dollars, pushing the average purchase price far above what we see on paper. +++
+++ If former President Donald TRUMP wins another term in November’s election, Biden’s electric vehicle policies could be tossed into the trash. Trump, the presumptive Republican nominee after Nikki Haley suspended her campaign last week, once again repeated his claims that EVs are not ready for prime time, and structural issues still exist for widespread adoption. “I’m all for electric cars but you have to have all of the alternatives also”, Trump said in an interview. “First of all they don’t go far, they cost too much, and they’re all going to be made in China”. Trump has said in the past that EVs are a “hoax” and that an EV transformation will destroy the US auto industry and kill jobs. He has promised to reverse Biden’s EV policies if he returns to office and he’s now one step closer to doing so. Trump added some choice words for the people behind the “Biden all-electric mandate” in the CNBC interview, but he also voiced concerns over the infrastructure issues that exist in the US for an all-electric transformation. “You can’t just go to electric”, Trump said, adding that the grid isn’t up to the challenges of production and distribution. Trump is incorrect about criticism of the grid’s electrical output, but his critique of the distribution of energy (i.e., charging) is a continued concern for drivers and automakers. It’s why the automakers are doing all they can to improve the infrastructure issue by joining forces with Tesla in one instance and starting their own joint venture to expand charging in another. But the distribution issues Trump cites would be largely problems caused by a Trump presidency in and of itself. The biggest threat to the transformation is the cutting off of the federal spigot of funds for this key infrastructure, namely the Inflation Reduction Act’s federal EV tax credit and the Bipartisan Infrastructure Law’s $7.5 billion earmarked to build an EV charger network. If Trump is successful in rolling back these landmark initiatives, an electric transformation in the US would be difficult to achieve. Automakers are also seeing the writing on the wall coming from their own consumers, who echo some of the concerns Trump has with EVs. The combination of high rates and serious price premiums over comparable gas-powered cars and hybrids has led to stalling sales. And now Ford, GM, and even Tesla are warning about the slumping demand continuing into 2024. Trump’s desire to see more “alternatives” is already happening because of this, with Ford pivoting deeper into its hybrids and reports that GM is looking to add hybrids to its product portfolio ASAP (It currently only has one: the Corvette E-Ray). Stellantis CEO Carlos Tavares told last month that the automaker was already game-planning for either a Trump or a Biden election win, with “multi-energy platforms” that can accommodate both fully electric or a more traditional gas-powered option with the same model. The upcoming Dodge Charger muscle car is an example of that strategy with 2 powertrains. As for Tesla, going the hybrid route is not a possibility. But CEO Elon Musk still has a friend in the former president, at least for now. “I’ve been friendly with him over the years, I’ve helped him when I was president; I’ve liked him”, Trump said when asked about Musk and a meeting he had with the Tesla CEO at Mar-a-Lago this past weekend. “We obviously have opposing views on a minor subject I’ll call electric cars”. Whether Trump carves out some kind of special treatment for his friend Musk or maintains the EV tax credit for fully electric vehicles like those made in the United States by Tesla is anyone’s guess, but that scenario looks less likely as November approaches. +++
+++ Chinese EV maker ZEEKR is poised to launch a sleek electric MPV to rival the Volkswagen ID.Buzz, and an European launch is on the cards in the next 2 years. The Geely-owned brand’s fifth production car, called the Mix, has been revealed in the latest batch of Chinese regulatory filings ahead of its official debut at next month’s Beijing motor show. Aimed at family car buyers, the new 5-seater is one of a quintet of models that 3-year-old Zeekr is set to launch in Europe as part of a broader push into our market by Geely. A 2026 introduction is possible. The Mix has been conceived to rival the ID,Buzz and is set to follow that MPV in offering rear-wheel drive initially but adding four-wheel drive during its life cycle. The basis for the new model is the Sustainable Experience Architecture (SEA) platform. This underpins a wide range of models from various Geely brands, including all existing Zeekr models. At 4.688 mm long, 1.995 mm wide and 1.755 mm high, the Mix is 24 mm shorter and 58 mm wider than the ID.Buzz. It also has a wheelbase 20 mm longer than that of the Volkswagen, at 3.008 mm. Further information included in the Chinese government filing confirms it will receive a battery developed in partnership between CATL and Geely; likely the 86 kWh pack used by the Zeekr 001, which is equipped with 800 Volt hardware for 360 kW charging. The engineering of the Mix has been twinned with that of the new Smart #5, a compact electric MPV that’s also set to be unveiled at Beijing. +++
