BMW is recalling 1.5 million vehicles due to brake failure
The statement said that for the three months up to the end of September, the number will be in the “high three-digit million” euro level picture.
BMW, announced Tuesday that it is recalling 1. 5 million cars due to braking problems and cut its profit outlook for the year, which led to a heavy share price drop. This recall will affect the worldwide sales figures in the second half of the year, said the car manufacturing firm that owns both Mini and Rolls-Royce trademarks.
The statement said that for the three months up to the end of September, the number will be in the “high three-digit million” euro level picture. Volkswagen announced last week that it was thinking about going as far as closing plants in Germany and it seems BMW has been affected by lower demand in China as well as the bigger picture of the German car market. A source with inside information about the matter informed AFP that Continental was the supplier of the breakdowns’ brake system.
Apart from the implications of the recall, China’s poor performance persists in constraining sales volumes, despite government stimulus, said BMW in a statement. Earlier in the year, Munich-based BMW had anticipated a slight lift in the delivery of automobiles this year and now it is anticipated to be a tiny plunge.
It only said it incurred costs that run in several millions of dollars, but did not specify the amount. In 2023, automaker combined BMW, Rolls-Royce, and Mini produced a total of 2.56 million automobiles. Further, the manufacturer also lowered its earnings estimate for the year to six to seven percent instead of the original eight to ten in profit margin. Following the announcement, the automaker’s shares on the Frankfurt Stock Exchange dropped 9%.
The Chinese market watchdog revealed last month that BMW had also recalled 1.4 million cars in the nation owing to malfunctioning airbags. Due to the effects of worse business in China and increased manufacturing costs, BMW recorded a decrease in net profit in the second quarter. Between April and June, the group’s net profit decreased by 8.6% to 2.7 billion euros ($2.9 billion), mostly due to a 0.7 percent reduction in revenues to little less than 37 billion euros.
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