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BMW warns profits will fall, plans $13.6 billion in cost-cutting

FRANKFURT, Germany — BMW said Wednesday that profits in 2019 will be "well below" last year's, and it will cut 12 billion euros ($13.6 billion) in costs by the end of 2022 to offset spending on new technology. The company said profits would be eroded by higher raw materials prices, the costs of compliance with tougher emissions requirements and unfavorable shifts in currency exchange rates. The Munich-based automaker also faces increased uncertainty due to international trade conflicts that could lead to higher tariffs. "Depending on how conditions develop, our guidance may be subject to additional risks; in particular, the risk of a no-deal Brexit and ongoing developments in international trade policy," said Chief Financial Officer Nicolas Peter. The company forecast a profit margin of 6 to 8 percent for its automotive business, short of the long-term strategic target of 8 to 10 percent, which it said still "remains the ambition" for the company if given "a stable business environment." BMW said it had no plans for layoffs even as it outlined cost saving measures that include dropping half of its engine variants as it seeks to reduce product complexity. The BMW, Mini and Rolls-Royce brands are to get a single sales division. Peter said that given the headwinds to earnings, "we began to introduce countermeasures at an early stage and have taken a number of far-reaching decisions." The company said the measures were needed "to offset the ongoing high level of upfront expenditure required to embrace the mobility of the future." Automakers around the world have faced heavy up-front costs for technology expected to change how people get from one place to another in the next decade. Those include electric cars and renting cars through smartphone apps. Yet the returns from such investments remain uncertain and auto companies face competition from tech firms such as Uber and Waymo. BMW made 7.2 billion euros ($8.2 billion) in net profit last year, down 17 percent from 2017, when it booked a gain of $1 billion from U.S. tax changes. The company faced headwinds from increased tariffs on vehicles exported to China from the United States. It also suffered from turmoil on the German auto market when companies faced bottlenecks getting cars certified for new emissions rules. BMW faces uncertainty from U.S.-China trade tensions that could result in new tariffs if talks do not result in an agreement. U.S.

Mini USA will temporarily stop importing manual transmissions

Emissions certification woes strike again, this time at Mini. The U.S. arm of Blighty's iconic car company has had to temporarily put a stop to importing any models with manual transmissions beginning with July production, which is when BMW typically begins rolling the new model year down assembly lines. According to MotoringFile, calibration testing for the six-speed manual is taking longer than expected. The outlet guesses the interruption will conclude by September, because it has "seen these type of delays in the past and they've lasted from 1-4 months." It has queried the brand's head of communication, who said, "As much as we at MINI USA would like to have a definitive timeline, it would be too early to say." The spokesman did, however, say that Mini remains committed to the manual gearbox. That comes in contrast to Toyota's recent breakdown of manual take-rates across a range of vehicle types, Hyundai jettisoning the manual on the 2020 Elantra, and stalwart enthusiast rides like the Ford Mustang Shelby GT500 and Chevrolet Corvette leaving the stick-shift fold. Nevertheless, Mini's efforts feel, at best, like raging against the dying of the light, especially because the end of the MF report states, "the other big news is that Mini USA is also eliminating the manual option from some models all-together." MF isn't yet certain about which models are affected, though. Buyers stepping up during the row-your-own intermission will get a crack at the long awaited seven-speed dual-clutch transmission or a revised eight-speed automatic. The DCT will slide into the Cooper and Coooper S models, the traditional automatic makes a home in the 301-horsepower John Cooper Works Clubman and Countryman.

Mini apologizes with chocolate rose after spamming customer's inbox

If you're a manufacturer, there are only so many ways you can say "sorry" after your automated e-mail system goes berzerk and spams everyone on your mailing list with hundreds of the same message. Mini recently found itself in that very spot, and rather than respond with a sheepish mea culpa, the company's PR team took a different tack by sending owners a very unique gift box. How unique? Inside, one owner found a set of chocolate roses, a roll of duct tape and a genuine can of Spam.
In an accompanying note, the company said it hoped the sweets would help patch things up between the company and the victims of the e-mail barrage, but in the event that wasn't enough to do the trick, the duct tape was there to help out. And the can of Spam? That tagged along just for stress release. Apparently the canned meat is squeezable. We wouldn't know. You can check out full photos of the gift box here.