Rising sales signal strong third quarter for luxury-car makers

Strong sales increases indicate a significant rise in third-quarter earnings for luxury-car makers and momentum appears to extend into the last three months of the year.

"We ... intend to maintain this upward trend throughout the fourth quarter. Here, we expect to see robust growth in the double-digit percentage range," BMW sales chief Ian Robertson said in a statement Friday.

Robertson said he was confident that BMW would reach its sales target of more than 1.4 million vehicles in 2010 and maintain its position as the world's best-selling luxury-car maker ahead of Daimler AG's (DAI.XE) Mercedes-Benz brand and Volkswagen AG's (VOW.XE) Audi AG (NSU.XE) unit.

The core BMW brand last month posted a 20% sales rise to 117,467 cars, contributing to a 15% increase year-on-year to 892,737 vehicles in the first nine months.

Sales were fueled by strong demand for BMW's larger vehicles, such as the new-generation 5 series and the flagship 7-series sedan, which is poised to boost third-quarter profit as larger cars usually have richer profit margins than smaller and compact vehicles.

Luxury-car makers benefit from streamlined cost structures following the steep market slump last year as well as favorable exchange-rate effects caused by the relative weakening of the euro against major currencies. Third-quarter earnings appear to confirm the second-quarter trend, when profitability returned to pre-crisis levels.

Stuttgart-based Mercedes-Benz last month posted a 13% sales gain to 118,600 cars and a 16% increase to 854,000 cars year-to-date.

"The positive development of the past several months makes us very confident for the fourth quarter in which we will continue to increase our sales," said Mercedes-Benz sales chief Joachim Schmidt.

"We want to grow in our two biggest markets: Germany and the U.S.," he said, adding that sales were expected "to increase particularly rapidly in Asia, especially in China." China has been one of the few bright spots for luxury-car makers in 2009 and has continued to drive the industry's recovery this year.

Thursday, Audi reported a 16% sales rise in September to 102,650 cars, driven mainly by strong gains in China and the U.S.

Audi sales chief Peter Schwarzenbauer said the new A1 model "will give us extra momentum in Europe in the fourth quarter." In the first nine months, Audi's global sales were up 18% compared with the same period last year at 829,300 vehicles.