BMW Cuts Profit Outlook and Slashes 8,000 Jobs

BMW lowered the profit margin outlook for its core automotive business on Tuesday, marking the second reduction in five months. The company now forecasts a 2026 automotive EBIT margin between negative 0.5% and positive 0.5%, a sharp decline from the previous estimate of 1-3%.

BMW attributed the downgrade to weakening demand in China, where consumers are increasingly favoring cheaper domestic brands over established premium automakers. In response, the company is accelerating an organizational realignment that includes approximately 8,000 job cuts and a faster reduction of management functions to restore investor confidence.

The automaker expects automotive segment deliveries to decrease by 5-9.9% in 2026, although it maintains that automotive free cash flow will remain above €2.5 billion. This downturn mirrors similar profit downgrades and restructuring efforts at other German automakers, including Mercedes-Benz and Volkswagen Group, as they struggle with the market slump in China.