BMW's operational profits decline by 19.6% in Q2

Affected by "expenditures for future mobility", operational profits (EBIT) of BMW declined by 19.6 percent to a total of 2.2 billion euros in the second quarter (Q2) of 2019, the German premium car maker announced on Thursday.

With minus 23.4 percent and a total of 1.47 billion euros in Q2, the decline in EBIT was even stronger in BMW's automotive business with its brands BMW, Mini and Rolls-Royce.

Expenditures for research and development would have again exceeded "the high level seen in 2018", according to BMW. In Q2, the German car maker invested 1.4 billion euros in development as well as another 1.2 billion euros in its property, plants and equipment, an increase of 5.9 and 39.0 percent respectively.

"The growing proportion of electrified vehicles is also contributing to higher production costs," stated BMW.

The Bavarian car maker is currently planning to be offering 25 electrified vehicle models, half of which are set to be fully electric, by 2023. In addition, BMW is also anticipating to double its deliveries of electrified vehicles by 2021 compared to 2019.

"Unfavorable exchange rate factors and rising prices for raw materials had a dampening impact on earnings between April and June and competition also remained fierce on many markets," according to BMW.

Total turnover of the Bavarian car maker amounted to 25.7 billion euros in the second quarter of 2019, marking an increase of 2.9 percent. Car sales increased by 1.5 percent in the same period.

"At the six-month stage, we are on course to meet our targets for the full year," noted Harald Krueger, outgoing chief executive officer (CEO) of BMW.

At the start of July, Krueger had announced that he will not seek a second term in office as CEO of BMW. Oliver Zipse, currently responsible for the production division of the German car maker, will assume the role of CEO from Krueger on August 16.

BMW is expecting further growth for its business "driven by numerous model changes" in the second half of 2019.