At the beginning of this month, i.e. October of this year 2023, the European Union launched an investigation into subsidies for electric vehicles manufactured in China and subsequently exported to Europe, in response to a sharp increase in imports of these vehicles from China to EU countries. Considering that the company BMW (Bayerische Motoren Werke) AG is, together with the American car company Tesla, the largest foreign manufacturer of electric cars in China, according to reports from economic correspondents, the company BMW wants to diversify its risks. However, according to the statement of BMW Group director Mr. Zips, it is not about leaving China or a specific region of this Asian country.
BME (Bayerische Motoren Werke) AG (FF-BMW) is a German manufacturer of automobiles and motorcycles. The company divides its activities into four segments: Automotive Industry, Motorcycles, Financial Services and Other Entities. The Automotive segment develops, manufactures, assembles and sells cars and SUVs under the BMW, MINI and Rolls-Royce brands, as well as spare parts and accessories. The Motorcycles segment develops, manufactures, assembles and sells motorcycles, spare parts and accessories. The financial services segment focuses on car leasing, multi-brand financing, fleet deals, retail client and dealer financing, client deposits and insurance activities. The Other Entities segment includes other operating companies such as BMW (UK) Investments Ltd, Bavaria Lloyd Reisebuero GmbH. In 2022, the German automaker opened its $2.2 billion factory in Shenyang with a strong focus on electric vehicle production. The shares of this company are primarily listed on the Frankfurt Stock Exchange – FF under the stock symbol of the same name as the company name, i.e. BMW.
Trading with these shares in the last trading session on October 25, 2023 closed this trading day at a share value of EUR 91.23 per share in the current medium-term downward trend of the price of this FF-BMW share. According to the communication of economic correspondents in connection with the analysts of brokerage companies and financial strategists of the stock market, this FF-BMW stock has nevertheless increased its value since the beginning of this year 2023 by + 9.43% in an annual comparison, which reflects a higher growth in the share price than the current rate inflation in eurozone countries. According to the latest data from the European Statistical Office (EUROSTAT), inflation in the eurozone countries for the month of September this year reached a volume of 4.3% year-on-year. Furthermore, BMW AG pays its shareholders an annual dividend, which is currently EUR 8.50 per share, which, based on the current value of the share, represents an annual dividend yield of 9.32% p.a. From this point of view, investors who opened a so-called long position with this share title (FF-BMW) appreciated their free funds by almost 15 percent per year, according to financial analysts.
European Commission President Ursula von der Leyen already said on September 13, 2023, that “the global market is flooded with cheaper electric vehicles” at “artificially low” prices due to “huge state subsidies”. “This may result in the Commission imposing countervailing duties on imports of battery electric cars from China into the EU to offset state subsidies, if justified, and to level the playing field,” said a notice published by the European Commission on October 4, 2023. BMW manufactures cars, including electric cars, in China and subsequently exports them to Europe. China has thus become a global production and export center for electric cars, especially for car companies such as BMW AG and Tesla Inc., which are today the world’s leading players in electric mobility. It is thanks to the growing competitiveness of Chinese electric cars, price advantages of production and large production capacity that China is a sought-after global destination for the production of electric cars, and especially for these two car manufacturers, the Center for Strategic and International Studies said. Analysts indicate a current target price of EUR 98-114 per share as a price prediction for FF-BWV shares.