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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.

New Rolls-Royce Boat Tail shows off coachbuilding chops of the Phantom platform

Rolls-Royce is flexing the coachbuilding muscles of its highly versatile new Phantom platform with this gorgeous Boat Tail commission. Rolls-Royce claims the build required the fabrication of more than 1,800 unique parts and 20 years of combined man-hours to complete.  Even by Rolls-Royce standards, this is pretty ambitious stuff. The commission was inspired by a 1932 Rolls-Royce Boat Tail, and like the original, it was inspired by, well, boats. Shocking, right? The trim elements both inside and out (Caleidolegno veneer, if you're curious) were designed to be reminiscent of the teak decking you'd see on a wooden yacht. "Today marks a seminal moment for the House of Rolls-Royce. We are proud to unveil Rolls-Royce Boat Tail to the world, and with it, the confirmation of coachbuilding as a permanent fixture within our future portfolio," said Rolls-Royce CEO Torsten Muller-Otvos in the Boat Tail announcement.  "We have formally re-established our Coachbuild department for those patrons who wish to go beyond the existing restraints, and explore the almost limitless possibilities this opens up for them," Muller-Otvos said previously. "We are able to offer our customers the opportunity to create a motor car in which every single element is hand-built to their precise individual requirements, as befits our status as a true luxury house." There are quite a few bespoke accessories as well, though apart from the full picnic service shown in some of the pics (there doesn't appear to be much of a trunk — sorry, boot), most of it was left out of the promotional materials. Most notably absent are the custom his-and-hers Bovet 1822 timepieces that were commissioned alongside the car. They can be either mounted in the dash or worn on the wrist (of course), but we see only a glimpse of one in the top-down image Rolls-Royce provided.

Rolls-Royce to show new Cullinan SUV in 'closed-room' events

Rolls-Royce plans a series of closed-room events starting this summer to show off its upcoming ultra-luxury SUV to potential buyers ahead of its expected unveiling in late summer. Codenamed the Cullinan and described by the company as an "all-terrain, high-sided vehicle," the SUV is Rolls-Royce's answer to ultra-luxury competitors like the Bentley Bentayga and Lamborghini's new Urus. It's expected to nudge the brand's vehicle sales past 5,000 a year after sales in 2017 fell 16 percent to 3,362, Automotive News reports. Engineers are now finalizing the handling of the vehicle on Germany's Nurburgring track. The Cullinan bears the luxury brand's signature long hood, vertical-slatted grille and upright, block-like fascia. It will be built on the same aluminum platform as the Phantom and is also likely to share the 6.75-liter twin-turbo V12 that makes 563 horsepower and and eight-speed automatic transmission, only in all-wheel-drive. Sales are expected to start near the end of the year with deliveries beginning in 2019.Related Video: