BMW Warns Over EUR 1 Bln Charges Related To Antitrust Fine

(RTTNews) - BMW Group (BMW.L) announced that it will recognise a provision, which is likely to exceed 1 billion euros, related to EU Commission investigation into German automakers allegedly colluding to delay the rollout of cleaner-emission cars.

The company specified that the provision will drag on first-quarter financial results and the EBIT margin in the Automotive Segment for the current financial year is expected to be 1-1.5 percentage points below the previous target range of 6-8%.

The company noted that guidance of the Group profit before tax for the current financial year remains unchanged (significant decrease compared to the previous year).

The European Commission announced Friday that it has informed BMW, Daimler and VW (Volkswagen, Audi, Porsche) of its preliminary view that they have breached EU antitrust rules from 2006 to 2014 by colluding to restrict competition on the development of technology to clean the emissions of petrol and diesel passenger cars. The collusion occurred in the framework of the car manufacturers' "circle of five" technical meetings.

In 2017, the Commission carried out inspections at the premises of BMW, Daimler, Volkswagen and Audi in Germany, as part of its initial inquiries into possible collusion between car manufacturers. The Commission opened an in-depth investigation in September 2018.

The company's review of the Statement of Objections and the inspection of files will take some time. As a result, a final evaluation of the financial impact is currently not possible.

BMW said it's contesting the allegations with all legal means, but that it's probable the European Commission will issue a significant fine.