BMW said it is confident it can return to growth in China, its largest market, with the rollout of its all-electric Neue Klasse lineup, beginning with the iX3 sport utility vehicle unveiled this week.
“We are more than competitive with this product,” Chief Financial Officer Walter Mertl told Reuters. “With increasing availability of the Neue Klasse, we will see growth in China again.”
The German luxury carmaker has struggled in the country amid fierce competition from domestic rivals and a slowdown in consumer spending tied to a property market downturn. Sales in China fell 15.5% in the first half of 2025.
The new iX3 50, due to launch in China by summer 2026, will be central to BMW’s strategy. Mertl said battery costs in the Neue Klasse models are 40% to 50% lower than in existing vehicles, allowing the company to reach “margin parity” with its combustion engine equivalents by 2026.
BMW currently expects an automotive EBIT margin of 5% to 7% in 2025, with a long-term goal of lifting that to 8% to 10%. The Neue Klasse rollout is also expected to phase out older models by the end of the decade.
The comments came ahead of the 2025 IAA auto show in Munich, where European automakers face rising pressure from Chinese competitors.
On trade, Mertl reiterated that U.S. import tariffs will weigh on BMW’s profits, cutting margins by 1.25 percentage points in 2025. The European Union and the United States are negotiating a deal that could reduce tariffs on European cars to 15% from 27.5%, with automakers hoping the lower rate will apply retroactively from August 1.
