This article was originally published in English
Shares in the company collapsed last week following the profit warning which revealed the scale of the problem, with €5bn at one point wiped off the company’s value.
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The brake system fault that led to BMW to recall no less than 1.5 million cars friends more than two years to be discoveredaccording to documents disclosed by Bloomberg.
The report says customers and dealers have started to complain about faulty brakes as early as June 2022.
However, it was only last month that the German carmaker realised how many cars could be affected.
Stocks fall as automaker reveals extent of problem
BMW said the cost of repairing the faulty braking system could be as high as 1 billion euros.
The company’s shares collapsed last week following the profit warning, due to the scale of the problem, with the stock value being reduced by 5 billion euros at some point.
Some 80,000 vehicles were recalled in the United States in February following BMW’s in-depth review of the issue, which began in October 2023.
The figure has since skyrocketed and appears to be a widespread problem for BMW and includes a number of Rolls-Royce brands.
“This is not an ordinary reminder, but a major shock“, said Ferdinand Dudenhöffer, director of the Automotive Research Center Bochum, quoted by Bloomberg.
“What is also remarkable is that BMW has strengthened its quality control of its suppliers with a working group, which indicates that it perceives the risks more generally.”
Concerns over due diligence of supply chains
“BMW is generally very cautious, preferring stability to short-term spikes, which is reflected in its margins,” he added.
A BMW spokeswoman told Bloomberg that it would take time to learn the full extent and financial impact of the recall.
The defect was reportedly detected in a factory in Hungary.where stains or dust on the circuit boards have affected performance. No accidents or injuries have been reported as a result of this defect.
Bloomberg quoted Andrew Graves, an automaker analyst and emeritus professor at the University of Bath, as saying the growing number of recalls raised “serious questions” about the due diligence of automakers’ supply chains.
“The industry may need to focus on its core competencies to avoid such problems in the future,” he added.
Additional sources • Bloomberg, adaptation: Serge Duchêne
