BMW Hopes Job Cuts Can Shore Up Sliding Profit — Update

By Joshua Kirby

BMW said it is working to reshape its business, including through job cuts, as a tough auto market weighs on sales and earnings.

The German auto group said Thursday that it reached an agreement with labor representatives on an "extensive workforce restructuring program" including voluntary severance packages. That could affect up to 8,000 workers in Germany, a personal familiar with the matter told The Wall Street Journal this week.

Those jobs cuts aim to cut costs amid an automotive industry facing "rapidly escalating challenges," said Chief Executive Milan Nedeljkovic, who took the helm of the group in May this year. He pointed to intense global competition, as well as conflict and increasing regional regulatory requirements.

"That's why it's important to be lean and agile," Nedeljkovic said. "We are working to reshape our organization and processes, thereby positioning the company to stay competitive going forward."

BMW's earnings before interest and taxes plummeted by 39% on year over the quarter through June as the group faced weakening sales in China, as well as currency and commodity headwinds, it said Thursday. Efforts to cut costs could only partly offset those drags on the bottom line, BMW said.

Revenue dropped by 8% to 31.26 billion euros ($35.85 billion), dragged by a 30% reduction in sales of its cars in China. The mainstay automotive segment booked an operating margin of 2.3%, down from 5.4% a year earlier.

For the full the year, BMW said it still expects a drop in deliveries from last year and a "significant decrease" in earnings before tax. The automotive operating margin should drop to 1%-3%, down from 5.3% in 2025.

Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby

(END) Dow Jones Newswires

July 30, 2026 02:11 ET (06:11 GMT)