Full-year 2012 financial results for BMW’s motorcycle operations — BMW Motorrad and Husqvarna — reveal a dramatic drop in profit despite increased turnover.
Total revenue from powered two-wheelers rose by 3.8 per cent to £1.29bn. This was based on a previously-reported annual sales growth at BMW Motorrad of two per cent to 106,358 units and a 15.8 per cent improvement to 10,751 units at Husqvarna.
However, related operating profit plunged by 80 per cent to just £7.8m and pre-tax profit suffered more, down by 85.4 per cent to £5.2m. This represents a mere 0.008 per cent of BMW Group’s overall pre-tax profit for 2012, which was up 5.9 per cent to £6.75bn.
Such ill-fortune is attributable to a financial black hole at the Husqvarna factory that has sucked in massive investment with very poor returns — which is why BMW Group chose a “new direction” for its motorcycle business in January 2013 and jettisoned Husqvarna to KTM supremo Stefan Pierer for an undisclosed sum (ie not a lot of money) to stem further losses.