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Archive for the ‘Earnings’ Category

BMW Warns Profits Will Fall in 2019 After Tough 2018

A disorderly Brexit could impact German automaker's bottom line.

by Michael Strong on Mar.20, 2019

The BMW Group warned that profits would be down again in 2019, and at higher levels than 2018.

BMW Group officials are predicting that this year will be tougher than last year and plans to implement a more than $13 billion plan to cut costs and improve efficiency by 2022 to offset technology development investments and currency costs.

The company saw profits drop 7.9% in 2018 and expects that to rise to 10% this year. As a result, it’s looking to improve efficiency levels and find ways to cut costs as Brexit issues are likely to make for a bumpy ride for European-based automakers.

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Additionally, the need to plow more money into electric vehicle and autonomous vehicle development is driving the $13.6 billion, or 12 billion euros, plan to trim expenses. However, BMW officials admit it’s an aggressive response to only a potential problem. (more…)

SEC Says Musk’s Response to Lawsuit “Borders on the Ridiculous”

Regulators tell court Tesla CEO failed to clear a single tweet with automaker per settlement.

by Paul A. Eisenstein on Mar.19, 2019

Tesla CEO Elon Musk shown during last week's unveiling of the new Model Y.

Federal regulators have shot back at Tesla CEO Elon Musk in their battle over a contempt-of-court lawsuit, claiming the 47-year-old executive’s legal argument “borders on the ridiculous.”

The case stems from a tweet Musk filed last month declaring that Tesla would produce 500,000 vehicles this year. The Securities and Exchange Commission considered that “material” guidance which, under terms of a separate case last year, required the CEO to first get the approval of the company. But, the SEC said in a new filing, Musk has not cleared a single tweet with Tesla as he had agreed to.

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The lawsuit is being heard by U.S. Judge Alison Nathan who could hold Musk in contempt and levy fine or other forms of punishment. The Tesla executive was already forced to relinquish his post as chairman and could now be removed as the automaker’s chief executive officer.

(more…)

BMW Reassigns Key Management Responsibilities

Moves designed to make company leaner.

by Joseph Szczesny on Mar.18, 2019

BMW's Harald Krueger noted the company's recent shuffling of executives should make the company leaner and more competitive.

The BMW Group is reorganizing its Board of Management to create what Is described as a new leaner, future-oriented management structure.

“We are restructuring our divisions to give us the best possible foundation for the future. It sends out a clear signal that our organization is lean and efficient throughout the company,” said Harald Krüger, chairman of the BMW AG Board of Management, speaking in Munich on Friday.

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The moves come at a time when carmakers the world over are facing sweeping change and major financial pressures. In fact, BMW recently announced plans to alliance with archrival Mercedes-Benz to address technical issues with autonomous vehicles. German carmakers, such as BMW, also are still reeling from a losing bet on diesel technology that has cost them dearly. (more…)

SEC Suing VW, former CEO, for ”Massive Fraud” in Emissions Cheating Scandal

Lawsuit "legally and factually flawed," the automaker responds.

by Paul A. Eisenstein on Mar.15, 2019

Former VW CEO Martin Winterkorn faces legal problems in Germany, as well as the U.S.

Volkswagen’s ongoing efforts to end a scandal triggered by its cheating on diesel emissions testing just took a turn for the worse, the Securities and Exchange Commission accusing both the automaker and former CEO Martin Winterkorn of committing a “massive fraud” on U.S. investors.

The automaker has acknowledged it used “defeat devices” to rig its diesel engines to illegally pass emissions tests and has so far laid out over $30 billion in fines and settlements. It is still facing other legal headaches, including a separate lawsuit by investors and ongoing investigations in Europe, one resulting in the arrest and jailing of the former CEO of its Audi subsidiary. But it responded to the latest challenge by declaring the SEC lawsuit “legally and factually flawed.”

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The SEC lawsuit, filed in San Francisco, claims the automaker and former CEO Winterkorn concealed the depth of the scandal – and the potential penalties – from both investors and federal regulators. The Thursday complaint noted that in the year before the cheating was discovered and publicized by the EPA Volkswagen issued $13 billion in bonds and securities in the U.S. Those value of those financial devices were directly impacted once the carmaker’s subterfuge was revealed.

(more…)

Musk Confirms Tesla Won’t be Profitable in Q1

Founder says "a lot going on" during quarter.

by Michael Strong on Mar.01, 2019

CEO Elon Musk said the company will lose money during the first quarter, but be profitable again after that.

Tesla’s tease made the $35,000 Model 3 a reality for the legions of fans who had been waiting for the entry-level model the company’s founder, Elon Musk, promised about two years ago.

And while the announcement sated many who wanted the lowest-priced Model 3, lost in the hubbub was a less promising announcement Musk made later in the call.

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“Given that a lot is happening in Q1, we do not expect to be profitable in the first quarter,” he said during a call with media and analysts. He quickly added that the company expected to return to profitability in the second quarter. (more…)

Ghosn Affair Hits Nissan’s Bottom Line, Along with Weak Sales

Automaker downgrades future earnings forecast.

by Paul A. Eisenstein on Feb.12, 2019

Nissan is taking an $83.2 million charge against earnings due to the scandal surrounding Carlos Ghosn.

Nissan Motor Co. warned that its earnings for the fiscal year ending March 31, could be about the lowest the carmaker has seen in six years.

Nissan now expects to earn 410 billion yen, or $3.7 billion, for the fiscal year, a 45% year-over-year decline. It originally projected a 500 billion yen, or $4.5 billion profit.

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The second-largest of the Japanese automakers put most of the blame on sliding sales in the U.S. and China, its two largest markets. But it also revealed that it has logged an $83.2 million charge related to the scandal that began with the arrest last November of its former Chairman Carlos Ghosn. (more…)

Daimler AG Profits Fall as Car, Van Division Sales Drop

Mercedes fails to meet last year's profit, sales marks.

by Joseph Szczesny on Feb.08, 2019

Daimler AG Chairman Dieter Zetsche fields questions from the media during the company's annual earnings press conference.

Daimler AG said its fourth-quarter operating profit fell 22% as trade wars and ballooning costs for developing electric and self-driving cars took a bit out of the company’s profits.

The German automaker’s earnings before interest and tax or EBIT dropped to 2.67 billion euros in the fourth quarter, falling short of analyst expectations of 2.92 billion euros.

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Mercedes-Benz said increased tariffs on vehicles imported from the United States to China and delivery stoppages for individual diesel models hit demand and resulted in weaker prices. (more…)

FCA Hourly Employees Getting $6K Profit-Sharing Checks

Fiat Chrysler employees have taken home $29K since 2009.

by Joseph Szczesny on Feb.07, 2019

Fiat Chrysler's hourly employees will received $6,000 profit-sharing checks.

Hourly employees of Fiat Chrysler Automobiles N.V. will collect $6,000 from the FCA-United Auto Workers profit-sharing plan next month, the automaker announced after releasing its fourth quarter financial reports.

Based on the company’s 2018 financial performance, FCA US LLC announced today that it will make average profit-sharing payments to approximately 44,000 employees on March 8, 2019.

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With this payment, U.S. hourly employees have received on average more than $29,000 in profit sharing since 2009. (more…)

Toyota Profits Up in 3Q, But Miss Analysts’ Mark

Automaker cuts forecast for rest of year.

by Joseph Szczesny on Feb.07, 2019

Toyota's Masayoshi Shirayanagi said the automaker is looking for ways to further cut costs.

Toyota Motor Co., Japan’s largest automaker, posted a profit of 676.1 billion yen, or $6.16 billion, for the third quarter, up from 673.64 billion yen in the same period a year earlier.

However, the result fell short of the street’s expectations of the 680.84 billion yen median of 10 analyst estimates compiled by Refinitiv.

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The automaker saw rising sales in Asia, particularly China, offset a decline in the company’s largest market: the United States. (more…)

Pickups, SUVs Push GM Profit Well Above Expectations

Automaker betting numbers will look even better as truck production ramps up in 2019.

by Paul A. Eisenstein on Feb.06, 2019

GM reported stronger than expected earnings as Chairman and CEO Mary Barra continues to reshape the company.

General Motors handily beat Wall Street’s earnings forecast for the fourth quarter and full year a strong performance that reflects both booming truck demand and the payoff of shedding the company’s long-struggling European operations.

For the final quarter of 2018, GM delivered earnings of $1.43 a share — $1.40 after excluding special items. The consensus, according to Zacks Investment Research, was $1.24. For the full year, earnings came to $6.54 a share, well ahead of the consensus forecast of $6.29. After special charges, the figure dropped to $5.58 per share.

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GM’s overall $8.1 billion profit for all of 2018 was more than double the $3.9 billion number from the year before, but the 2017 figure reflected a significant hit from the sell-off of the company’s long-troubled European Opel-Vauxhall subsidiary. It was acquired by PSA Group, parent of the Peugeot and Citroen brands. (more…)