BMW profit up 52 percent in China

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BMW profit up 52 percent in China

Bayerische Motoren Werke AG’s Chinese partner reported first-half profit surged 52 percent on demand for new models including its 5-series sedan in the world’s largest auto market.

Net income at Brilliance China Automotive Holdings rose to 2.03 billion yuan ($332 million) from 1.33 billion yuan, the company said yesterday in a statement to the Hong Kong stock exchange. Sales fell 8.5 percent to 2.57 billion yuan.

BMW has said China will probably surpass the United States as its top market this year as the brand enters more communities and wins buyers with its 3- and 5-series sedans. The automaker, which trails Volkswagen AG’s Audi in China, has grown faster than its competitor for at least four straight years.

Brilliance gained 1.3 percent to HK$10.66 in Hong Kong before the announcement, extending the company’s gains this year to 12 percent. The benchmark Hang Seng Index rose 1.2 percent yesterday.

China’s environmental protection ministry last month sent back an application by BMW Brilliance to expand production capacity at their assembly plant in Shenyang, citing inadequate wastewater analysis and the plan’s failure to meet anti- pollution targets. BMW has since said it will meet all government requirements and that its expansion plans are on track.

Earlier this month, BMW Brilliance issued a recall for 143,215 vehicles in China for power steering faults, according to the General Administration of Quality Supervision, Inspection and Quarantine.

Brilliance, which assembles the 3- and 5-series sedans and X1 SUVs, said deliveries increased 31 percent in the first six months of the year to 105,692 units. BMW deliveries in China - including vehicles shipped from Germany - climbed 18 percent to 214,994 vehicles in the first seven months of this year, according to company data.

The first new-energy model for Zinoro, Brilliance’s joint venture brand with BMW, will be sold in China by the end of the year.

BMW Brilliance is also planning to add more BMW models for local production to widen its reach in China and expanding its dealer network, which exceeded 380 outlets as of June 30, according to the statement.

Bloomberg

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