BMW reported a higher core profit margin in the third quarter, benefiting from peak research and development spending on its all-electric range, even as high U.S. tariffs and Chinese competition weigh on European automakers.
The company’s automotive operating margin rose to 5.2%, up from 2.3% a year earlier when brake issues affected sales. Group earnings before interest and tax reached 2.3 billion euros ($2.7 billion), while revenues totaled 32.3 billion euros, slightly below expectations.
“In the third quarter, we once again proved that our business model is robust and resilient,” said CEO Oliver Zipse.
BMW maintained its full-year car margin guidance at 5%–6%, down from 6.3% in 2024. The company expects its upcoming all-electric Neue Klasse series to drive growth in 2026, with orders for the debut iX3 model extending several months into next year in Europe.
Tariffs lowered BMW’s car margin by roughly 1.75 percentage points in Q3. While U.S. production at the Spartanburg plant helps mitigate trade-war impacts, EU tariffs affect Chinese-made electric Minis, adding pressure to the company’s global strategy.