BMW’s Strong Second Half
With the pandemic forcing most businesses to shift toward remote work, car companies of all types suffered heavy losses during the first half of last year. BMW was no exception as several factories had to stop business operations for an extended period of time. The losses the car company sustained during the first half of the year had a lasting impact as well, plummeting net profits on the year by 23%. As a result, the company only took in $4.62 billion in total profit.
However, despite the financial difficulties of the first half of the year, the second half saw the car company rebound as business began boosting across the board. In fact, BMW saw operating profits rise 9.8% higher than the same time period in 2019, showing strong signs of recovery. A large reason behind this was the strong business that BMW maintained in China.
While sales fell sharply across Europe and the United States (US), China became a major center of business for the car company. This actually translated to a net sales increase of 7.4% over the course of the year in comparison to 2019 for the company as China’s economic recovery began earlier than in many other regions.
Future Outlooks for BMW
Much like many other car manufacturing companies, there is a wave of optimism surrounding BMW as the economic recovery in 2021 looks to boost consumer sales across the board. This is especially true for higher-end luxury models, which already have a higher margin of profit. However, BMW does have one area of concern in comparison to its rivals. While the car company continues to shift its business interests toward electric vehicles, it is doing so at a far slower rate than competitors such as Volkswagen, who have increased their recent target to 70% of all sales being electric by the end of the decade.
BMW will still be offering more all-electric options moving forward with two new models, the i4 and iX, coming out for consumer purchase by the end of this year.
About the Author
Tom Price is a writer focusing on entertainment and sports features. He has a degree from NYU in English with a minor in Creative Writing. He has been previously published for Washington Square News, Dignitas, CBR, and Numbers on the Boards.