AutoBeta(AutoBeta.net)06/19 Report--

According to German media reports, although German carmaker BMW began to resume work and production in mid-March, it is still difficult to cope with the impact of COVID-19 's epidemic, even though the group has adjusted its 34000 employees to short-time work due to lack of market demand. As a result, BMW management decided to cut 6000 full-time jobs and massively eliminate temporary workers and short-term contracts after weeks of negotiations.

Although BMW did not specify that its R & D and production departments plan to cut the number of temporary workers within a year, there are reports that it will reach as many as 10000. BMW also said it would lose money in the first half of 2020 as a result of the shutdown, with sales expected to fall from 2.5 million to about 2 million.

In fact, as early as March this year, BMW Group announced a cost-saving plan of 12 billion euros, in which layoffs were listed as part of streamlining and improving efficiency. According to the original plan, BMW plans to cut 5000 to 6000 jobs by 2022, mainly at its headquarters in Munich, Germany.

Obviously, even BMW Group, as a luxury brand car company, is not immune from the impact of the epidemic. In terms of sales, BMW Group's car sales fell 21% to 477111 units in the first quarter. Of these, BMW brand sales fell 20.1% to 411800 vehicles, MINI brand sales fell 23.4% to 64449 vehicles, and Rolls-Royce brand sales fell 27.2% to 853 vehicles.

The decline in car sales has a direct impact on the performance of the automotive sector. Revenue in the automotive division fell 6.4 per cent to 17.989 billion euros in the first quarter from a year earlier, with EBIT profits of 229 million euros and EBIT margins of 1.3 per cent, compared with-1.6 per cent in the same period last year, according to the data.

BMW said in a statement that it would continue to be under pressure for the rest of the year as the epidemic reduced demand for cars. To this end, BMW Group cut its profit forecast for its automotive division, and BMW's sales will fall sharply under the impact of the epidemic, leading to a deterioration in earnings, especially in the first half of the year.

However, for BMW, the performance of the Chinese market is still worth looking forward to. According to the BMW Group's financial report, BMW's sales in China reached 723700 in 2019, up 13.1% from a year earlier and accounting for 28.71% of global sales. In April this year, BMW (including the MINI brand) sold 67228 vehicles in China in April, an increase of about 13.5% over the same period last year.

In addition, the joint venture between BMW and Great Wall Motor has also been officially launched. Recently, Great Wall Motor and Beam Motor signed a framework agreement, according to which Great Wall Motor and its holding subsidiaries provide beam automobile with services such as research and development, factory construction management, production process development and consulting, with a transaction value of 4.5 billion yuan.

2020 is regarded as the first year of BMW products. In addition to the IX3, BMW will launch 16 new products in the Chinese market, of which the new BMW X5 plug-in hybrid and 5-series plug-in hybrid upgrade will hit the market in the first quarter. By the end of 2020, BMW will offer two pure electric models in the Chinese market, while hybrid models may cover all traditional fuel cars currently on sale.

The Chinese market is showing a recovery, and overseas markets are still under great pressure. According to the Association of European Automobile Manufacturers (ACEA), sales in the European passenger car market fell 56.8 per cent in May from a year earlier to 623812 (the lowest in 30 years), while sales in the European passenger car market fell 42.8 per cent to 3969714 from January to May. Although BMW's sales in the Chinese market have resumed growth, the gap in overseas markets is still difficult to make up. While laying off staff while stepping up research and development efforts, it is foreseen that BMW will not feel relaxed in 2020.

Welcome to subscribe to the WeChat public account "Automotive Industry Focus" to get the first-hand insider information on the automotive industry and talk about things in the automotive circle. Welcome to break the news! WeChat ID autoWechat