German Carmakers’ 2023 Outlook Dim

Investment bank says BMW’s planned model introductions could help it face expected hazardous conditions. - IMAGE: BMW Group

Investment bank says BMW’s planned model introductions could help it face expected hazardous conditions.

IMAGE: BMW Group

Forbes reports that German carmakers BMW and Mercedes’ 2023 outlooks appears less than bright.

Both brands recently reported healthy third-quarter earnings, BMW profit growing 23% to $3.3 billion, Mercedes’ surging 83% to $5.4 billion and Volkswagen’s 52.6% to $4.5 billion.

A lingering chips shortage has hobbled the industry, hampering production and narrowing inventories, and that issue is expected to continue next year, based on a Berenberg Bank reported. Compounding that is a shaky economy, with high inflation and rising interest rates.

The investment bank said BMW’s planned model introductions could help it face the expected hazardous conditions, while Forbes reported that Bernstein Research said Mercedes’ rising pricing power and cost adjustments should buoy its profits.

Meanwhile, investment bank UBS predicts that the overall luxury vehicle segment will weather the rough winds better than others. Bernstein’s VW picture, though, was far less rosy, warning that its sizable risk exposure and lack of a “compelling equity story” makes its portfolio role “unclear.”

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Originally posted on F&I and Showroom