BMW abandons 2008 profit target

UPDATE Carmaker BMW AG said today net profit for the third quarter dropped 63% as the global economic turmoil made consumers more reluctant to shell out for its sports and luxury cars and credit costs made it difficult for consumers and the company to borrow.

The Munich-based company said net profit for the July-September period fell to 298 million euros ($375.5 million) from 803 million euros a year ago.

“The knock-on effects of the international financial crisis and a downturn in the global economy had a significant negative impact on the performance of the automobile industry," BMW said in a statement.

“Ongoing consumer reticence on the main sales markets, the weak state of the preowned car markets together with difficult refinancing conditions also took their toll on the BMW group, resulting in a perceptible drop in revenues and earnings."

11/04/08 BMW warned on Tuesday it could no longer give an earnings outlook for 2008 beyond expecting a profit after quarterly results at the world's largest premium carmaker fell far short of expectations.

With group sales set to fall again sharply in October in tough markets, it chopped planned production by at least another 40,000 units on top of the 25,000 vehicles it had earlier scrapped. The total cuts represent 5 percent of 2007 output.

Its shares fell 5.3 percent to 19.495 euros by 0827 GMT, the biggest decliners among German blue chips .