Competitive pressure in China combined with import tariff-related headwinds on earnings are denting German car manufacturer BMW's rating headroom. We expect profitability, specifically the S&P Global Ratings-adjusted EBITDA margin, to come under pressure in 2025 and 2026. We therefore revised our outlook on BMW to negative from stable. At the same time, we affirmed our long- and short-term 'A/A-1' issuer credit ratings on BMW and its rated subsidiaries as well as our 'A/A-1' issue ratings on the company's debt. The negative outlook reflects the market erosion in China, the lack of clarity regarding when market conditions in the region will return to normal, and the uncertainty over pending tariff negotiations with the U.S. administration. With market growth concentrated in a
