BMW Group has reported a sharp drop in first-half earnings, weighed down by a slumping Chinese market and fiercer global competition. Group pre-tax profit fell 29.4% to €4,045 million in the first six months, and the company has agreed a workforce restructuring programme with its Works Council. Despite the pressure, sales rose in Europe and the US, and demand for its new Neue Klasse electric models is building.

BMW Group says it is sharpening its focus and cutting costs faster as the car industry faces what it calls rapidly escalating challenges. The Munich-based maker of BMW, MINI and Rolls-Royce cars — plus BMW Motorrad motorcycles — points to a steep downturn in China, tougher competition across Asia-Pacific and the fallout from geopolitical conflict as the main forces squeezing its business.

As a first step, the company has reached an agreement with its Works Council on an extensive workforce restructuring programme that includes voluntary severance packages.

“The automotive industry is faced with rapidly escalating challenges – intense global competition, increasing regional regulatory requirements and the implications of geopolitical conflicts will shape our business model in the years ahead. That’s why it’s important to be lean and agile,” said Milan Nedeljković, Chairman of the Board of Management of BMW AG.

Profit down sharply

According to the company, second-quarter Group pre-tax earnings (EBT) came in at €1,697 million, down 35.1% year-on-year, for an EBT margin of 5.4%. Over the first half, EBT reached €4,045 million (-29.4%), with a margin of 6.5% against 8.5% a year earlier.

In the core Automotive Segment, the second-quarter EBIT margin slipped to 2.3%, from 5.4% in the same period of 2025. BMW says this figure was dragged down by around 1.25 percentage points of costs tied to US and EU import duties, plus roughly 1.2 points from depreciation and amortisation linked to its Chinese joint venture. Half-year Group revenues fell 8.0% to €62,266 million.

China drags, Europe and the US grow

BMW Group delivered 1,156,727 vehicles worldwide in the first half, down 4.2% on the same period last year. The picture varied widely by region: sales climbed in Europe (+5.4%) and the US (+3.9%) over the half, and the momentum built in the second quarter, with Europe up 7.6% and the US up 11.9%.

China, however, moved the other way. Deliveries there fell 20.4% in the first half to 261,773 units, and dropped 30.2% in the second quarter alone – a decline the company describes as accelerating.

MINI was a bright spot, with second-quarter deliveries up 17.1% to 81,032 cars. More than one in three MINIs sold in the first half was fully electric.

Neue Klasse gathers pace

BMW’s electric push continued, with 116,807 fully-electric vehicles delivered in the second quarter (+5.2%), meaning nearly one in five of all its cars sold was a battery-electric model. In Europe, BEV sales jumped 37.9% in the quarter to 81,500 units, accounting for almost a third of the region’s deliveries.

Much of the company’s hope rests on the Neue Klasse, its new generation of electric cars. The BMW iX3, the first Neue Klasse model, is on track to pass 100,000 orders since its March launch, and the second model, the BMW i3, has seen strong early demand. The all-new BMW X5 will offer Neue Klasse technology across five drivetrain variants.

What it means

The results underline how exposed premium carmakers have become to China, once a reliable engine of profit and now a fiercely price-competitive market. BMW’s answer – cutting costs, trimming its workforce and leaning on a fresh electric line-up – mirrors moves across the German industry as rivals face the same headwinds. For buyers, the strong reception for the iX3 suggests BMW’s new EVs will remain a central part of its range.

BMW says it achieved €2.5 billion in cost savings last year and is now intensifying its efficiency measures, including wider use of digitalisation and artificial intelligence. The company confirmed its guidance for 2026, which forecasts a slight decline in Automotive Segment deliveries and an EBIT margin in that segment of between 1% and 3%.

Facts: BMW Group H1 2026

  • Group pre-tax earnings (EBT): €4,045 million (-29.4%)
  • H1 EBT margin: 6.5%
  • Q2 Automotive Segment EBIT margin: 2.3%
  • H1 deliveries: 1,156,727 vehicles (-4.2%)
  • H1 fully-electric deliveries: 204,295 vehicles (-7.4%)
  • H1 revenues: €62,266 million (-8.0%)
  • H1 Automotive Segment free cash flow: €1,290 million

BMW Group has confirmed its financial guidance for 2026, while cautioning that political and macroeconomic changes could still move the outcome.

Source: www.press.bmwgroup.com