FRANKFURT – German carmaker BMW (BMWG.DE) on Wednesday reported a 27 percent drop in third-quarter operating profit to 1.75 billion euros ($2.00 billion), missing analyst expectations amid currency headwinds and higher research and development expenses.
Analysts in a Reuters poll had on average expected earnings before interest and taxes (EBIT) to come to 1.795 billion euros.
BMW said that despite a slight rise in deliveries of luxury cars, its operating return on sales for the automotive division narrowed to 4.4 percent from 8.6 percent a year earlier, well below its targeted range of 8 to 10 percent.
Earnings were hit by higher raw material prices, currency effects, higher provisions for goodwill and warranty measures, tariffs between China and the United States and a price war in Europe, the carmaker said.
Last month BMW warned its pretax profit would fall this year, against earlier expectations for a flat outcome, and cut its profit margin guidance for cars, blaming intense price competition.