|By Kramer Phillips | 4 years ago|
BMW AG has reported its weakest profitability since 2010, bringing to a close a tepid year for Chief Executive Officer Harald Krueger
Amid higher spending on battery-powered and autonomous driving technologies, BMW saw its automotive profit narrow to 8.9% in 2016, from 9,2% a year earlier.
According to a statement released on Thursday by the automotive giant, shares fell as much as 4.2%, the highest in four months.
“We are fully focused on implementing our strategy, which involves pivoting to self-driving, electric vehicles,” Krueger said in the statement.
Krueger added that from 2019 onwards, the company would be firmly embedding all-electric, battery-powered mobility in its core brands.
Lacking the financial heft of rivals backed by a larger parent, BMW is focusing its resources on innovation for the future, instead of chasing short-term sales volumes.
The car maker plans to launch its self-driving, electric iNext model in 2021 in a bid to regain its niche as an automotive leader.
To manage its rising development costs, the Munich-based company is pushing high-margin traditional car models such as the new X7 sport utility vehicle that is expected in 2018.
Boosted by the revamped BMW-5 series and Mini Countryman, sales in 2017 are expected to be slightly higher.
The company believes that the overall look is overshadowed by global politics and economic volatility.
Carmakers are investing in battery-powered vehicles in a bid to comply with tightening emissions regulations. However, customers are not rewarding the efforts because about the costs and driving range.
BMW plans to sell 100,000 electrified vehicles this year, for the first time.