BMW quarterly profit tumbles 78%, hit by €1.4 billion legal provision

FRANKFURT: BMW's first-quarter operating profit fell 78 per cent to €589 million, despite higher deliveries of luxury vehicles, as the carmaker felt the effects of higher investment spending and a €1.4 billion legal provision.

Analysts said BMW's results were underwhelming, adding that sales of electric and hybrid cars were not stellar. Shares fell 1 per cent after the market opened. Investments into new technologies and the rising cost of complying with stricter carbon emissions legislation are also likely to have a dampening effect on earnings.To counter rising costs, BMW said it will cut the available engine and gearbox combinations by 50 per cent and seek efficiency savings of more than 12 billion euros by the end of 2022.Excluding the impact of the legal provision to cover a potential anti-trust fine, BMW's automotive division delivered an operating margin of 5.

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