New models lift BMW earnings
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New models such as the X3 compact sports utility vehicle have helped BMW sales.
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FRANKFURT, Germany (Reuters) -- German car maker BMW said on Thursday its pre-tax profit had risen five percent in the third quarter as it felt the benefit of a raft of recent model launches and said it expected flat earnings this year.
"The expected upward trend set in during the third quarter and will increase until the end of the year,'' Chief Executive Helmut Panke said in a statement.
BMW had seen a sharp drop in profits in both the first and second quarters.
"Despite extensive spending on the product and market initiative, we expect from today's point of view to reach a group result at the previous year's level,'' he said.
The Munich based group posted pre-tax earnings of 724 million euros ($830 million), in line with the 727 million euro average forecast in a Reuters poll of 27 analysts.
BMW has tripled the number of model ranges it offers since the early 1990s, increasing product costs more quickly than revenues and squeezing margins quarter after quarter, but it is now nearing the end of its biggest ever new product program.
With the recent launches of its revised 5-series saloon, a new X3 compact sports utility and 6-series coupe, industry watchers had expected a pick-up in business in the second half.
Analysts noted however that BMW, whose market capitalization is similar in size to that of the world's two leading car makers, Ford and General Motors, had a favorable basis for comparison as last year's third quarter profit was capped by development costs for the new cars.
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