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BMW posts higher profit due to strong demand for top cars

BMW posts higher profit due to strong demand for top cars

BMW and its rivals have shifted production to higher-margin models as production has been hampered by the shortage of semiconductors and other supply chain problems.

Despite deliveries of 6 percent fewer cars in the first quarter, BMW’s car revenues increased 17 percent compared to the same period last year.

The profitability of BMW’s auto division lagged behind competitor Mercedes-Benz, which posted a record margin of 16.4 percent for its auto division in the first quarter.

BMW’s operating return on auto production was 8.9 percent in the first quarter, compared to analysts’ expectations of 7.8 percent.

Group sales were supported by the full consolidation of BMW’s Chinese joint venture, which contributed €3.3 billion since mid-February, BMW said. In February, the automaker said it would pay $3.7 billion to take a majority stake in its Chinese joint venture after obtaining the necessary license from Beijing.

BMW’s car production revenues are expected to increase in the second half.

In mid-April, BMW presented the new generation of its flagship 7 Series, including the i7 all-electric variant, which will be launched in November.

An upgraded version of its high-margin X7 SUV will go on sale from August.

Reuters contributed to this report