In the third quarter, despite the increase in traffic, the company's profits worsened further than market expectations due to US-China trade countermeasures, the introduction of a new emission measurement procedure and the cost of re-entry.
According to a report released on Wednesday, the Munich Group amounted to 24.74 billion euros in the third quarter, up 4.7% from sales revenue of 1.75 billion euros compared to the previous year, 26.8% less in the third quarter 2017. Experts interviewed the news agency Reuters expected an average of 1,795 billion euros of pre-tax profit.
Profitability based on revenues was close to half, which was reduced from 8.6% to 4.4% in the quarter. BMV was held in the range of 8 to 10 percent of income from earnings for thirty quarters.
The Group's net profit decreased from 1.84 billion euros to 23.9 percent to 1.41 billion euros in the third quarter.
According to BMV, the increase in the cost of raw materials and the effects of the exchange rate contributed to the deterioration of the results, as well as the increase in reserves for warranty costs, as well as the deepening of the interruption of international trade, which in some markets led to additional distortions and increased import costs.
In the third quarter, BMV has allocated 679 million euros to cover the expected costs of returns.
The introduction of VLTP, which is needed for the introduction of new cars and a more stringent method of measuring emissions, registered a turnover of 23.5% in the European car market in September. Due to the lack of official metering stations, several car factories have been postponed to allow the placement of new models on the market. The sale of BMV to its competitors, Volkswagen and Daimler, was less influenced by the introduction of a new measurement process.