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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.

Rolls-Royce Corniche Coupe does some performance testing at N"urburgring

While all the gory details surrounding the new Rolls-Royce coupe - including its true name, "Corniche" is just a savory-sounding best guess right now - are still shrouded in mystery, this new set of clandestinely foraged images proves that the car probably won't be a slouch in terms of performance.
The Ghost-based Roller was spotted on the Nürburgring Nordschleife recently, demonstrating its sporting chops at the same time it was showing off it's impressive patrician nose. Expectations are that, when the new coupe is shown off for real at the Geneva Motor Show in March of next year, that nose will belong to the fastest production car to ever wear the Spirit of Ecstasy.
Indications are that the Corniche will be rocking a turbocharged V12, making in the ballpark of 600 horsepower, and using an eight-speed transmission.

Rolls-Royce posts 25% jump in sales thanks to Cullinan demand

Luxury carmaker Rolls-Royce said on Tuesday it recorded a 25% jump in sales in 2019, underpinned by solid demand for its first-ever SUV, Cullinan, just a year after the launch. The 116-year-old British company said it sold a record 5,152 cars in 2019, compared with 4,107 units in the prior year. "Worldwide demand last year for our Cullinan SUV has driven this success and is expected to stabilize in 2020," Chief Executive Officer Torsten Mueller-Oetvoes said in a statement. The Cullinan was unveiled in 2018. The BMW-owned brand's strong numbers serve as a breather at a time when the global automobile industry is still grappling with various challenges amid a broader economic slowdown that dented sales of many automakers. North America continued to be the biggest contributor with about a third of Rolls-Royce's total sales, followed by China and Europe. Related Video: