In 2025, BMW's pre-tax profit fell by 6.7 percent to 10.2 billion euros, while net profit dropped by three percent to 7.45 billion euros. Revenue simultaneously shrank by 6.3 percent to 133.5 billion euros. Despite this, shareholders are set to receive an increased dividend for 2025, up ten cents to 4.40 euros per common share and 4.42 euros per preferred share. The Klatten family holds nearly half of the shares in BMW.
Nevertheless, the Munich-based company is weathering the crisis significantly better than its competitors. Volkswagen and Mercedes had each reported a profit collapse of fifty percent, while Porsche barely managed to stay in the black. According to experts, BMW is benefiting from the fact that the company never announced a complete exit from the internal combustion engine business. Instead, it has developed and built combustion and electric vehicles in parallel for years, whereas at Volkswagen, the costly technological pivot at its sports car subsidiary Porsche has particularly weighed on the bottom line.
TARIFFS WEIGH ON MARGINS
However, tariffs on both sides of the Atlantic are causing headaches for BMW. CFO Walter Mertl quantified the impact of tariffs on the automotive profit margin at 1.5 percentage points last year. He stated that the outlook for the current year is somewhat more favorable. BMW expects an agreement between the U.S. and the European Union, as well as progress in talks between the U.S. and its neighbors Mexico and Canada. For the carmaker, import tariffs in Europe are as significant a problem as the tariffs imposed by U.S. President Donald Trump. BMW operates its largest plant worldwide in Spartanburg, South Carolina, where it manufactures a range of large SUV models for the global market. Approximately half of the production in Spartanburg is exported, much of it to Europe. BMW is also feeling the impact of EU punitive tariffs on electric cars from China, as it imports the electric Mini from the People's Republic. Overall, the profit margin in the automotive segment will be 1.25 percentage points lower this year due to tariffs, Mertl said.
Added to this is the weakening market in China, where the persistent crisis in the real estate market is weighing on demand for premium vehicles and domestic providers are outperforming Western manufacturers in the electric vehicle segment. Nevertheless, a stabilization has been visible since the fourth quarter, and the start of the current year has been solid, said Sales Director Jochen Goller. The Munich-based company is now pinning its hopes on new products entering the market starting in the second half of the year.
This primarily concerns the fully electric iX3, which will be the first model of the "Neue Klasse" to go on sale starting this year. With this vehicle, the company will succeed in achieving margin parity with combustion engines, particularly in Europe, said CFO Mertl. "This will also be accompanied by a return to an automotive profit margin of eight to ten percent." This mark remains the strategic goal for BMW, he added. In 2025, the profit margin had fallen by one percentage point to 5.3 percent; for 2026, management is targeting a value of four to six percent.
Sales chief Goller said it remains to be seen how much the war in Iran will weigh on business. The region is an important market, particularly for the luxury brand Rolls-Royce. "We assume that customers will return once the situation calms down."
(Report by Christina Amann, edited by Ralf Banser. For inquiries, please contact our editorial office at Berlin.Newsroom@thomsonreuters.com (for politics and economy) or Frankfurt.Newsroom@thomsonreuters.com (for companies and markets)
