For the first quarter 2019, BMW has declared 1.4 billion euros ($1.6 billion) drop in profit.
BMW’s first-quarter profits slumped after car sales in key markets slowed and the automaker revised a provision for a potential fine for alleged collusion to 1.4 billion euros ($1.6 billion).
Earnings before interest and tax (EBIT) declined 78 percent to 589 million euros compared to a year earlier, BMW said in a statement on Tuesday.
BMW last month made a provision of more than 1 billion euros for a potential anti-trust fine from the European Union’s investigation into alleged collusion on cleaner-emission cars.
Earnings were also weighed down by a 36 percent increase in spending on property, plants and equipment.
The company’s automotive division swung to an operating loss for the first time in a decade. Excluding the provision, earnings at the automaker’s main unit fell by 42 percent to 1.1 billion euros and delivered an operating margin of 5.6 percent in the first quarter, BMW said.
By contrast the return on sales at Mercedes-Benz passenger cars fell to 6.1 percent, down from 9 percent a year earlier and rival Volkswagen Group said the return on sales for its passenger cars business will be at the lower end of its 6.5 percent to 7.5 percent margin target this year.
In addition to the fine provision, BMW said in a statement that price competition in some markets and spending on new technology shrank profit.
