BMW’s operating profit in 2025 fell to its lowest level since the Covid pandemic, as the German automaker grappled with intensifying competition in China and mounting pressure from international trade tariffs.
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The group’s earnings before interest and taxes (EBIT) dropped 11.5% to €10.2 billion, down from €11.5 billion the previous year.
Net profit declined around 3% to €7.5 billion, while revenue fell 6.3% to approximately €133.5 billion.
The automotive segment bore the brunt of the pressure, with its EBIT margin slipping to 5.3% — its weakest result in recent years, and well below the 8–10% target corridor BMW had set itself.
Tariffs, both US import duties and an EU levy on Chinese-made electric vehicles affecting the group’s Mini brand, weighed on margins by approximately 1.5 percentage points over the course of the year.
Chief financial officer Walter Mertl said that without the tariff burden, BMW would have reported an earnings increase in 2025.
Despite the weaker performance, the company delivered approximately 2.46 million vehicles worldwide, a rise of 0.5% on the previous year.
Growth was strongest in Europe, where sales exceeded one million for the first time since before the pandemic, and in the United States, where deliveries rose around 5%.
China, BMW’s largest single market, saw sales fall by more than 12% as fierce competition from local manufacturers undercut the group’s performance there.
Electrification continued to drive growth within the portfolio.
BMW delivered more than 640,000 electrified vehicles globally last year, accounting for roughly 26% of total sales, with fully electric models making up around 18%.
The performance sub-brand BMW M also reached a record high, with more than 213,000 vehicles delivered.
A central plank of BMW’s future strategy is its new Neue Klasse vehicle architecture, which the company says will accelerate its electromobility push while integrating new technologies across the model range.
The platform launched with the new BMW iX3.
The outlook for 2026 is cautious.
BMW expects its automotive EBIT margin to land between 4% and 6%, with tariffs forecast to shave roughly 1.25 percentage points off margins.
Group pre-tax earnings are expected to fall moderately further in 2026.
Chief executive Oliver Zipse sought to strike a confident note.
“We have set the right course in recent years and do not need to change our strategic direction,” he said.
“In this way, we can keep the company on track for long-term success.”
Daimler also posts drop
Daimler Truck posted a sharp drop in annual profits on Thursday as a prolonged slump in commercial vehicle demand, compounded by US tariff headwinds, dragged earnings well below last year’s already-diminished levels.
The Stuttgart-based group reported adjusted EBIT of €3.78 billion for 2025, down 19% on the prior year, as revenue in its core industrial business fell 10% to €45.9 billion.
Earnings per share tumbled 30% to €2.56. The dividend was held at €1.90.
The worst of the damage came from North America, where unit sales collapsed 26% to 141,814 vehicles — a market battered by weak freight demand and the creeping effects of US trade policy.
Adjusted EBIT for the segment was roughly halved to €2 billion, though a return on sales of 10.7% suggested the business retained more structural strength than the volume figures implied.
Not everything points downward.
Daimler Buses delivered its best-ever profitability, crossing the double-digit return on sales threshold for the first time with a 10% margin, as adjusted EBIT surged 39% to €599 million.
Mercedes-Benz Trucks — long the group’s European headache — managed to hold unit sales broadly flat, a tentative sign that the worst of the continental downturn may have passed.
Chief executive Karin Rådström pointed to operational momentum and a burgeoning defence business, including a 7,000-unit Mercedes-Benz Zetros order from the French Army, as evidence that the group’s strategic repositioning was gaining traction.
“We are executing on our efficiency measures ahead of plan,” she said.
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