BMW shares slide after profit margin cut over faulty brakes and weak China demand

Shares in BMW dropped over 8% after revealing that 1.5 million cars sold in the past two years may have faulty braking systems, leading to a cut in full-year earnings forecast and setting aside funds for warranty payments due to weak demand in China. The faulty brakes, produced by Continental, could affect cars globally, with BMW warning customers and facing delays in deliveries, impacting their full-year operating margin and sales in China, despite growth in electric vehicle sales and retail sales outside of China. Analysts note BMW’s overexposure to the challenging Chinese market, with uncertainty surrounding positive catalysts for the company’s future performance.

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