The numbers for the last quarter of 2020 are showing more promise than BMW expected. In a press release published today, the Bavarian car maker announced better numbers than it had anticipated. According to them, the company generated more cash than expected over the entirety of 2020, arriving at a more optimistic conclusion than most analysts had hoped for. This is good news overall, as the industry is struggling to recuperate from the hit it took last year.
BMW’s automotive free cash flow was 2.8 billion euros in Q4 of 2020 and that wasn’t just great for the terrible year we have just gone through, but it was basically double the number recorded in Q4 2019. This rebound is largely attributed to the Chinese market. Having claimed the title of ‘the world’s biggest automotive market’ in 2019, China is now accounting for the biggest numbers not just for BMW but for other car makers as well. And, luckily, the Chinese market is showing strong recovery figures.
The battle is definitely on, though, as BMW has to battle with a number of rivals, from the old and new guard. Mercedes and Audi aren’t sitting idly by and on top of those two German giants, BMW also has to face competition from newcomers such as Tesla, NIO or Li Auto. The latter are in the business of making electric cars, and since EVs are easier to make than traditional ICE models, the fight is definitely on.
To this end, BMW announced plans to launch more premium electric cars (such as the BMW iX or the BMW i4) as well as an investment of a couple hundred million euros in internet marketing for its products. This will include more efforts to sell cars online as this seems to be the next step in the evolution of the automotive industry.