BMW Hopes China Car Sales Will Increase Next Year

BMW is confident that sales in China will increase next year, finance chief Nicolas Peter told Reuters, attributing high demand for premium cars to travel restrictions that have left consumers with more money to spend, Christina Amann and Victoria Waldersee reported for Reuters.

Photo Insert: BMW's having banked on China has resulted in a 12% rise in sales in the country.

Car sales in China have fallen in recent months as floods, COVID-19 outbreaks, and a semiconductor shortage hit the domestic market, but BMW has bucked the trend, reporting a 12% rise in sales there in its second quarter.

"The market will not grow as quickly as it did over the last 12 months - that was when the catch-up effects after the corona disruption made themselves felt," Peter said.

"But we do expect it to grow." BMW was also profiting from travel restrictions that have left more money in people's pockets in China for discretionary spending, he said on the sidelines of the Munich IAA auto show, the first such industry event since before the pandemic.

Peter said BMW had struck enough contracts for the raw materials needed to produce batteries for two to three years via its third-party suppliers, even as carmakers face shortages across supply chains of everything from lithium to chips.

Still, BMW has no plans to invest in battery production of its own as rivals such as Volkswagen or Daimler are doing as it is too early to know which battery technology will prevail in the future, Peter said.

The Munich-based automaker is also investing heavily in its recycling capabilities, he said, a move that ticked the boxes both of its sustainability goals, and cost-cutting.

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