The problem is with the integrated braking system (IBS) of the German equipment manufacturer Continental, which equips the vehicles of the BMW, Mini and Rolls-Royce brands of the Bavarian group.
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A major setback for the group’s performance. German car manufacturer BMW was forced to lower its annual targets on Tuesday, September 10. The cause: a faulty braking system that led to recalls and delivery stops affecting 1.5 million vehicles.
The problems concern the integrated braking system (IBS) of the German supplier Continental, which equips the vehicles of the BMW, Mini and Rolls-Royce brands of the Bavarian group. “Braking performance is not compromised and the brakes can still be applied, whilst remaining well above legal standards”Continental assured in a press release.
Consequence of recalls for BMW: Deliveries of vehicles by the group should now “slightly decrease” in 2024 over one year, when they were expected to progress slightly according to the initial forecast, after the record level of 2.56 million units reached in 2023. This will also affect the profitability of the group since the operating margin in the automotive business, the flagship division, is now expected to be in a range “from 6% to 7%”compared to 8% to 10% previously, according to a press release.
The taxable income of the group, which also supplies motorcycles, must now “step back sharply” and no more “slightly” as previously anticipated. On the Frankfurt Stock Exchange, BMW and Continental shares plunged, ending down more than 10%.