The German manufacturer BMW reported on Wednesday the fall in operating profit by 27% in the third quarter of 2018 to 1.75 million euros (2,000 million dollars), not meeting the expectations of the analysts due to the negative impact of variations in exchange rates and to the increase of the cost in investigation and development.
Reuters interviewed, on average, predicted that profits before interest and taxes (EBIT) would be 1,795 million euros.
BMW reported that, despite the slight increase in luxury car offerings, the automobile division's profitability fell by 4.4% from 8.6% a year earlier, which is less than the objective in the range of 8% to 10%.
The deterioration of the indicators is due to the increase in the prices of raw materials, the impact of changes in exchange rates, the increase in deductions to reserves for the deterioration of goodwill and the fulfillment of the guarantee obligations, the rates between China and EE. UU. The price war in Europe.
In the third quarter, BMW has reserved 679 million euros for the costs associated with the withdrawal of cars.