BMW’s Massive Global Recall Could Cost Nearly $1 Billion

BMW Reveals Integrated Braking System Recall Impacting Over 1.5 Million Vehicles

BMW has recently announced a significant brake recall affecting more than 1.5 million vehicles worldwide. This recall is expected to result in additional warranty costs of nearly a billion euros for the automaker. The recall will have a negative impact on BMW’s sales in the second half of the year, along with muted demand in China and weak consumer sentiment.

BMW Motorrad Faces Challenges in Core Markets

In addition to the automotive side, BMW Motorrad is also facing challenges in its core markets, including the United States and China. The ongoing competitive situation in these markets is impacting volume and price realization, leading to a flat sales forecast for the year.

Revised Financial Guidance and Stock Performance

As a result of these developments, BMW is revising its financial guidance for the year. The automaker now expects a slight decrease in sales instead of a slight increase. Furthermore, BMW has lowered its earnings before interest and taxes (EBIT) forecast to 6% to 7%. These announcements have caused a significant decrease in BMW’s stock, with shares falling to $77.10 on Tuesday, down 11.43% from the previous day’s close of $87.05.

More: BMW Recalls Nearly 80,000 Models Over Potential Loss Of ABS