BMW Shareholders are not impressed by what management calls a "moderate" drop in pretax profit expectations due to trade tensions and pricing pressure.
“The continuing international trade conflicts are aggravating the market situation and feeding uncertainty,” BMW said in a statement.
“These circumstances are distorting demand more than anticipated and leading to pricing pressure in several automotive markets.”
Specifically, BMW cut its overall 2018 pretax profit and automotive revenue and Ebit margin outlook.
The initial plunge was the biggest drop since Brexit (Summer 2016), but a modest bounce has pulled share 'off the lows'
BMW also cited industry-specific factors like "unexpected competition" amid the industry-wide shift to the new WTLP test cycle, as well as increased goodwill and warranty measures.
It should not be a total surprise to see the European automakers cutting outlooks and the broad EU auto market is weak on this straw breaking the camel's back...