By on May 4, 2011

Didn’t they say that you have to be a monster car company with at least 5 million units, just to survive? BMW did not get the memo. Aiming for sales of just 1.5 million units this year, BMW delivered a first quarter 2011 net profit before tax of €1.812 billion ($2.691 billion), surprising analysts that had expected something in the neighborhood of $2 billion.

As a comparison, GM, the world’s second largest automaker, “may report $1.74 billion in net income for the three months ended in March,” says Bloomberg. Quarterly results of industry leader Toyota will be announced next week, and nobody dares to place any bets at the moment. Volkswagen, currently #3 in the global sales ranking, earned €2.2 billion ($3.268) in the first quarter.

Size doesn’t seem to matter, at least not in this quarter.

 

 

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14 Comments on “Size Doesn’t Matter: BMW Delivers Big Boy Profits...”


  • avatar

    This is no surprise to anyone who has “built” or purchased one. $750 for bluetooth ? $900 for xenons on a 40k car ? Seat heaters optional ?

  • avatar
    wallstreet

    Say whatever you want, the fact is Roundel makes vehicle that folks are willing to break their piggy bank to own much like those snobbish Porsche products.

  • avatar
    vbofw

    ….$400 for the privilege of having satellite radio…$500 for fold-down rear seats…..

    Obviously not for everybody!

  • avatar
    wsn

    Quarterly profit/loss is irrelevant. The accounting system is so complicated that a lot of costs can be shifted around. For many years, GM has used the tactic of over-estimating the residual value of their leases and as a result was able to report profits for a while, and then take a huge “one time” loss.

    So, if you have to compare profits, compare 4 year rolling profits as the typical product cycle is 4 years (or a multiple of 4 years).

  • avatar
    Jimal

    Funny what a company can do when it is privately held and can focus primarily on product instead of shareholder wealth. The options are expensive but I don’t recall hearing the words “BMW” and “cost cutting” or “BMW” and “decontenting” in the same sentence.

    • 0 avatar
      krhodes1

      Oh, they have certainly decontented right along with everyone else. All sorts of little details on the early E9X cars that went missing with the ’09 refresh. The door on the ashtray/sunglasses holder, the magazine nets on the backs of the seats, some of the interior lights, the power point in the center console, the underhood insulation pad, on and on. But prices have only gone up a little while the dollar has dropped a LOT. And some things that were once standard are now options.

    • 0 avatar
      th009

      Remember those gooseneck trunk hinges that everyone was complaining about on the new Jettas? Take a look at the current 5-series and you’ll see the same type of trunk hinges.

  • avatar
    gslippy

    That works out to nearly $1800 per vehicle, but what fraction of average transaction price is that? It means a lot more if Hyundai is making that kind of per-car money, than it does to BMW, for example.

  • avatar
    DenverMike

    This is news? The base 3-series is $35k but I don’t see more than $22k in content and material make up. Vinyl seats, AM/FM/CD, 205/55/16 tires, 230HP, open diff… Snobbery must be at an all time high but at least people are owning up it. In the past you could could deny it while claiming German cars had superior quality/engineering/handling.

    • 0 avatar
      stuki

      The 3 is hardly the biggest poster child for snobbery out there. It’s pricey, but there really aren’t many in the way of substantially cheaper alternatives that does not force you to give up something meaningful.

      That 230Hp I6 is absolutely pure sweetness, and available with a manual to boot. For non street racers, I can’t imagine there being a better engine out there.

      It is also available in every conceivable body style sans 3 door shooting brake. In addition, cheaper cars simply can’t be optioned with lots of little doodads that combine to make life easier, like radar cruise, rain sensing vipers, automatic high beams etc., etc., despite many of these technologies probably costing no more than 50 bucks in volume.

      The two trends I see that would threaten BMW, is a slowing economy and more expensive credit forcing people to hold cars longer past warranty, and gas prices/eco sentiments reducing fleet wide power output to the point where rear drive bias no longer means much to driving enjoyment. If that happens, Honda really needs to get off their rear, and offer the Civic in the same array of body styles and engine choices as BMW now offers the 3.

      • 0 avatar
        DenverMike

        Non enthusiasts are easy to spot when they don’t know when to turn off the highbeams or windshield wipers. Anyone that opts for the manual trans may be an enthusiast but if the cruise has to remind him no to not rearend the car in front of him, he may not be an enthusiast. BTW, that radar cruise is $2,400 which brings us back to the topic, ouch! By the time you fully load a 3-series with options, you’re a few dollars away from an M3. Which again brings us back to the topic.

    • 0 avatar
      jeano

      If you can’t see or feel the value in a BMW, you are not an enthusiast- just another Ford (or whatever) fanboy, so don’t let it bother you. Comments about snobbery are way off base, just because you don’t get it ( and likely can’t afford it anyway).

  • avatar
    oldyak

    I am 60 years old and have wanted a BMW since my first ride in a high school teachers husbands 2002..that would be around 1969.When I was a kid in Iowa I saw my first BMW. It was that ‘rad’ looking coupe,I am thinking a’CS’ but please correct me if I’m wrong.We had a dealership in Columbus that sold them along with Alfa`s…..
    As I grew older I kept thinking that my income would one day allow me to buy one,nothing fancy,just a ‘3’series.Well with kids and a mortgage and so on and so on…..It never came to pass..until a year ago when I was able to buy a 2000 M Roadster.I drove it home from Columbus Ohio to Memphis Tennessee with the top down and the radio off!Let me tell you that in my opinion
    the “ultimate driving machine” is alive and well.There are a lot of people that buy BMW`s…and weather its for “the right reasons”or not ,They are still,IN MY MIND”the ultimate DRIVERS machine.
    oldyak

    • 0 avatar
      th009

      They certainly can be driver’s machines, maybe even ultimate ones, though most models are far less pure these days. In the end, BMW is not my choice of weapon, but I very much respect your 2000 M Roadster — that is definitely a serious driving machine.

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