BMW misses profit expectations, shares fall sharply

The world's largest premium automaker, BMW, reported that its third-quarter pretax profit fell short of expectations, leading to shares falling sharply.

Before tax earnings rose 6.3 percent to 765 million euros ($1.11 billion), missing the average estimate of 913 million euros from a Reuters poll of analysts. Shares of BMW fell more than 4 percent, performing worst than other European automakers.

"The main reason for the weaker than expected result appears to be found in the 'Other & Consolidation' line. This is usually heavily impacted by one-offs and is very difficult to estimate," Tim Schuldt told Reuters.

Investors have been criticizing BMW CEO Reithofer's vision as unambitious, despite his recent plans to increase automobile retail to 1.8 million units by 2012. Speaking to the press, Reithofer recently said, "As far as retail volume is concerned, we intend not only to remain the world's leading premium provider in the automotive industry. By 2020, we want to lead all of the segments in which we are active," said Reithofer.

Reithofer said that BMW's main goal is to increase automobile retail to more than two million units by 2020.

BMW won't extend Panke's contract

Automobilewoche says that BMW AG won't renew its chairman's contract past its end in 2007. It was recently reported that BMW would extend the contract of Dr. Helmut Panke, who turns 60 next year, to 2010; however, now it seems that BMW will go along with its customary practice of retiring its board members at 60.

The decision is interesting given Panke's success -- at this point in Panke's tenure, BMW is hitting record numbers.

Mercedes doesn't want to play nice with BMW

A three-pointed "Nein" is what Mercedes has responded to BMW's offers of courtship. The folks from the roundel had suggested that the two companies combine some of their efforts in order to build the best cars. BMW hadn't specified what kind of tie-in that would mean, but they were serious enough about it to go public with it. Mercedes and BMW currently work together on hybrid engines, but that, frankly, is as far as Mercedes wants to go. It's entirely possible that, having just gotten out of one relationship, Mercedes isn't anxious to do it again so soon, no matter how good looking the potential match is.

BMW becomes world's biggest-selling premium automaker

BMW outdid compatriots Mercedes and Audi to sell the most cars in August, taking the cake with the number one spot and probably the Benjamins as well. Compared to Audi's 66,400 cars and Mercedes' (and smart's) 96,200, BMW (with MINI) rolled 99,755 cars off dealer lots.

BMW couldn't have done it without the success of the MINI, and we can debate whether it's fair to include it in a shootout. Minus the little British lifestyle accessory, BMW only moved 85,003 units. Nevertheless, as long as its in there, it bodes well for the blue-and-white propeller, with the X5 and MINI (which is up 24%) still doing very well. All three makers have new and refreshed models on the way shortly, but BMW also has the brand new -- and certain to be popular -- volume-selling 1-Series and MINI Clubman in the works.

And not that they will add too much to the tally, but while we're throwing things in, there's the Rolls-Royce Phantom Drophead Coupe that will probably outsell Maybach all by itself. If it isn't already, the question soon will be: can you get too much BMW?

Rumors: BMW To Create Eco-Friendly 4th Brand

Mark our words; over the next few months we're going to be hearing a lot of rumours about BMW Group (BMW, MINI & Rolls Royce) and its alleged 4th brand. Following last week's report from UK magazine Autoexpress referring to the renaissance of the Triumph brand (BMW holds the rights to the name), German business magazine Wirtschaftswoche is now reporting that the Bavarians are in search of an engineering firm that will help them develop a series of eco-friendly vehicles for a new brand.

In his speech towards the group's shareholders back in September, BMW Group CEO , Norbert Reithofer did not rule out acquisitions or the creation of a new brand. However Reithofer did note that none of the existing brands fit neatly into the group.

Ok, so BMW is interested in adding a fourth brand to its portfolio. What next? Well, basically the Bavarian's have three options: A- Acquire an existing brand that's for sale (eg. Volvo), B- Create a new brand from scratch and C- Revive a brand using one of the names you hold the rights to (eg. Triumph). Every option has its pros and cons, but to make a long story short, we'd go for option "B"; create a new brand. An "eco-friendly" brand sounds even better. -Continued after the jump

Why go into all that hassle to buy an existing carmaker along with factories, debts etc or use one of the useless Brit names (petrolheads aside, the younger generations have no idea of obsolete marques like Truimph). We're not saying that it's going to be easy (think Mercedes-Benz and Smart), but BMW has proven the past two decades that, with the exception of the failed Rover/MG-Rover Group marriage, it can create and market vehicles that people want to buy.

BMW Group: Increased Sales & Revenues For Third-Quarter

The BMW Group has announced increased sales volume and revenues and earnings figures for the third quarter of 2007. However, despite the improvement in third quarter profits before tax (+6,3%), the group's overall profit before tax during the first nine months of the year is still down by a whopping 17,4% (€2,682 million) compared to 2006.

In terms of car sales, the Bavarian carmaker saw its third-quarter sales rise by 12.8% to 364,564 units (third quarter 2006: 323,064 units) while the number of cars sold during the first nine months of the year (January to September) increased by 7.2% to 1,094,849 units (first nine months 2006: 1,021,534 units). -Continued after the jump

The number of BMW brand cars sold in the nine-month period to September went up by 6.3% to 929,379 units (first nine months 2006: 874,208 units) whilst the sales volume for the period from July to September rose by 10.8% to 306,964 units (third quarter 2006: 277,088 units).

MINI also showed sharp sales volume growth rates in the third quarter, with the number of cars sold rising by 25.2% to 57,315 units (third quarter 2006: 45,788 units). Sales volume for the nine-month period increased by 12.3% to 164,891 units (first nine months 2006: 146,851 units).

Finally, the number of Rolls-Royce brand vehicles delivered to customers during the nine-month period rose by 21.9% to 579 units (first nine months 2006: 475 units) while sales volume for the third quarter jumped by 51.6% to 285 units (third quarter 2006: 188 units).

Third-quarter revenues of the BMW Group rose by 19.2% to euro 13,778 million (third quarter 2006: euro 11,557 million). Profit before tax improved by 6.3% to euro 765 million (third quarter 2006: euro 720 million), whilst the net profit rose by 77.7% to euro 803 million (third quarter 2006: euro 452 million) partly as a result of tax effects.

During the first nine-months of the year, the Bavarian carmaker saw its revenues grow by 11.1% to euro 40,412 million (first nine months 2006: euro 36,368 million). The group profit before tax amounted to euro 2,682 million (first nine months 2006: euro 3,248 million /-17.4%). The group profit after tax was euro 2,143 million (first nine months 2006: euro 2,187 million /-2.0%).