BMW eyes smaller than expected EU antitrust fine
Carmaker to get an about €1bn boost to earnings from revaluing a provision for a fine over collusion with peers to delay rolling out cleaner cars
Frankfurt — BMW will raise its earnings forecast for the year because it expects an antitrust fine from the EU will be much smaller than anticipated two years ago.
The carmaker said late on Thursday it will get an about €1bn boost to earnings this quarter from revaluing a provision for an EU fine over allegations that it colluded with its German peers to delay rolling out cleaner cars. BMW shares rose as much as 1.9% on Friday in Frankfurt.
BMW expects the EU “will significantly reduce its allegations” against the company, according to a statement. The lesser-than-anticipated penalty will allow the company to raise its margin projection for auto earnings before interest and taxes by about 1 percentage point.
At issue is the EU’s investigation of BMW, Volkswagen and Daimler over their alleged conspiring on emission-reduction systems for diesel cars between 2006 and 2014. The EU said in 2019 that the companies’ co-ordination made technology aimed at reducing nitrogen-oxide emissions less effective.
Daimler was first to inform the EU about the possible breach of cartel rules and therefore may avoid a fine. VW has also co-operated with authorities and is less exposed to legal risk than BMW.
The provision reduction adds to a run of positive momentum for BMW. The company said this month it expects returns for its main auto business to be at the upper end of the 6%-8% range it was forecasting for the year. While the carmaker was recently forced to idle some production due to the global shortage of semiconductors, it has not lost as much output as rivals.
BMW shares have risen about 19% this year, roughly in line with the Stoxx 600 Automobiles & Parts index.
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