Germany's economy, along with those of other European countries, may be struggling right now, but one of the country's premier automakers sees brighter days ahead. BMW said Tuesday it expects pretax profits this year to "rise more sharply than previously forecast," driven by better-than-expected vehicle sales.
In a statement, Munich-based BMW said it expects sales to rise about 10% to more than 1.4 million units, and noted that so far this year, it has sold 13% more vehicles than during the same period a year ago. The company previously forecast a single-digit rise in sales this year, and expected to sell 1.3 million cars, Dow Jones Newswires reported. In the first six months of 2010, the maker of BMW, Mini and Rolls-Royce automobiles has sold nearly 700,000 cars.
The company's financial division is also experiencing a recovery. As a result of attractive market conditions and reduced risk, BMW said, the automaker's finance arm "is striving for a significant increase in pre-tax earnings with a target return on equity of over 18%."
BMW acknowledged that numerous economic risks remain and said its presumptions are "based on the condition that the economic recovery continues and that general business conditions are not significantly dampened."
Sales of luxury cars flagged in the wake of the financial crisis and subsequent recession. But demand has risen within the segment in recent months, driven by strong demand in China and a recovering U.S. market, Dow Jones reported.
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