BMW AG

China is a critical market for BMW, both for its internal combustion engine cars and its electric offering. In China, its electric offering includes the iX, iX2, iX3, i3, i4, the upcoming i5, the Mini models, the RR Spectre, and the recently introduced all-electric i7 manufactured in Dingolfing, Germany. More than 80% of vehicles sold in China are produced and assembled locally. The stable outlook reflects our view that BMW will continue to expand its competitive BEV line to build its BEV market share under its main brand, such that it converges to its current passenger car market share across its key regional markets. We forecast that the group will be able to maintain adjusted EBITDA margins well above 11%

...BMW has strong exposure to China where we expect the market will contain fierce competition in the next two years. Passenger car sales in China accounted for about 33% of total units sold in the first nine months of 2023. In our revised global auto sector forecast, we anticipate only slow sales growth in the region, in addition to ongoing pricing pressure over 2024 and 2025 as a result of intense competition, particularly in the battery electric vehicle (BEV) segment. Unlike in Europe and the U.S., we think BMW's premium positioning in China is less effective in protecting it against aggressive price competition for vehicles at the low end of the portfolio....

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