Dear colleagues, ladies and gentlemen, good morning and welcome to the telephone conference of the BMW Group for the third quarter. Today we have here, as always, Oliver Zipse, Chairman of the Board of Management, and our CFO, Walter Mertl. First, Walter will take you through our financial results. Oliver will then give you a general business update for the BMW Group. After a short break, we will then have time for our Q&A session. So, ladies and gentlemen, we start. Walter, please go ahead.
Good morning, ladies and gentlemen. First, I want to make clear that the sales and earnings figures we are releasing today should be viewed in the light of extraordinary challenges. As you are aware, we revised our guidance for 2024 on September 10th. This was mainly due to two factors. First, temporary delivery stops and technical measures related to the integrated braking system, or IBS, delivered by a supplier.
And second, the ongoing muted demand in China. In the case of IBS, numerous markets have to replace the affected parts before cars can be delivered to customers. This led to temporary delivery stops that impacted sales and earnings and drove up inventory levels. In the third quarter, we fully recognized the necessary provisions for warranty obligations in the high three-digit million EUR range.
Looking forward, we have already made good progress with the implementation of technical measures worldwide and expect to complete them for most cars held in stock by the end of this year. So, in Q4, we will see volumes well above Q3 and an improved product mix. Let's now take a look into the numbers for the third quarter. At group level, revenues were significantly lower than in the prior year quarter, at EUR 32.4 billion. Group EBIT totaled EUR 1.7 billion.
The financial result was considerably impacted by negative fair value measurement effects, and consequently, Group EBT amounted to EUR 838 million. The Group EBT margin came in at 2.6%. Year to date, Group EBT totaled almost EUR 8.9 billion, resulting in an EBT margin of 8.4%. The automotive EBIT margin was 2.3% for the third quarter and 6.6% for the year to the end of September.
Excluding the depreciation resulting from the purchase price allocation of BBA, the automotive EBIT margin came in at 3.5% for the quarter and 7.7% for the first nine months. After nine months, the BMW Group global sales showed a slight year-on-year decrease of 4.5%. The balance sheet of the BMW Group has increased by EUR 11 billion since the beginning of the year.
Half of this increase is driven by the growth of our financial services portfolio and thus represents future profit potential. The remaining increase is mainly related to temporary inventory buildup. While the third quarter results were impacted by extraordinary factors, it is important to highlight the positive aspects of our operational performance. Sales of our all-electric vehicles amounted to almost 300,000 vehicles in the first nine months of the year, a significant increase of 19.1%.
BEVs made up 16.8% of our deliveries for the year to the end of September. Despite the temporary delivery stops, and excluding the Chinese market, the BMW brand reported worldwide growth of 4%. In Europe, the brand achieved sales growth of 7.6%, and our core brand continues to be well positioned in the U.S. and maintained its market share. Moving to the automotive segment.
In the third quarter, the BMW Group delivered around 541,000 BMW, Mini, and Rolls-Royce vehicles to customers worldwide. This represents a decrease of 13% compared to the same quarter of last year. However, our all-electric vehicles continued to perform well. Over 100,000 units were delivered to customers, 10.1% more than in the same quarter of last year. The share of our all-electric vehicles was 19.1% of total sales.
And in fact, more than a quarter of our total sales came from electrified vehicles, that is, BEVs plus plug-in hybrids. The successful sales development of our electrified vehicles is clear proof that we are well on track to fulfilling our CO2 emission targets in the EU for 2025. Segment revenues amounted to around EUR 28 billion, which was lower than in the same quarter of 2023.
In Q3, revenue per unit continues to be at last year's level. EBIT for July to the end of September totaled EUR 634 million. The EBIT margin came in at 2.3% for the quarter and 6.6% for the year to the end of September. That brings me to the next slide, which is the details of the changes in the operational results. The net balance of currency and raw material positions exceeded the previous year by EUR 200 million.
For the full year 2024, the net balance of currency and raw material positions should provide a tailwind of close to EUR 1 billion. We expect this to nearly offset the headwinds from material costs. But we are seeing additional requests for supply chain support. The net balance of volume, model mix, and pricing effects negatively impacted EBIT by EUR 2.1 billion in the third quarter compared to the previous year.
All three elements trended lower year on year. The volume effect reflects the sales decline I mentioned earlier. The mix was also adversely affected since the temporary delivery stops and market conditions in China had a greater impact on vehicles in the upper premium segment. This will turn in Q4, as we expect to see an improved product mix.
The pricing effect reflects the ongoing challenges of a difficult price environment globally, as well as weak consumer sentiment in China. The health of our dealers' operations is strategically important to us. Therefore, in Q3, we have implemented measures jointly with our Chinese dealers to support both profitability and liquidity. Research and development expenses increased by about EUR 100 million compared to the prior year quarter. Group expenditure for research and development reached approximately EUR 6.6 billion in the first nine months.
The R&D ratio, according to the German commercial code, was at 6.3% at the end of September. It is significantly higher than prior year, partly due to high expenditure, but also compounded by lower revenues. The capitalization ratio for development costs stood at 35.3% after nine months, evidence of our ongoing commitment to investing in innovation.
Selling and administrative expenses for the third quarter were on par with the previous year as planned, and other cost changes include the high three-digit million EUR warranty expenses related to IBS and some smaller compensating items. Overall, the negative net effect in this position amounts to EUR 500 million compared to the prior year quarter. Free cash flow in the automotive segment totaled negative EUR 2.5 billion in the third quarter.
Earnings before tax contributed around EUR 400 million. The change in working capital of EUR 1.9 billion reflects the temporary increase in inventory levels, partially compensated by lower receivables. The net effect of capital expenditure and depreciation reduced free cash flow by EUR 1.2 billion. Capital expenditure for July to September totaled EUR 2.2 billion. This represents a CapEx ratio of 6.7% for the third quarter and 5.3% for the nine-month period.
A significant portion of our capital expenditure will accrue in the fourth quarter, as in previous years. As a result, we still expect the CapEx ratio for the full year to be over 6%. At the end of the first nine months, free cash flow in the automotive segment totaled -EUR 200 million. In line with our guidance, we expect a free cash flow of over EUR 4 billion for the full year, despite the planned peak investments in R&D and CapEx.
On the one hand, we anticipate a significant sequential increase in EBT in the final quarter of the year. On the other hand, we also expect a strong positive contribution from the reduction in working capital. We are making good progress in replacing the affected IBS components worldwide. In addition, we have taken measures to adjust our production.
Given these measures and the projected sales volume increase in Q4, we expect inventory to be on previous year's level by the end of 2024. Net financial assets in the automotive business totaled close to EUR 40 billion as of September. The NFA position was impacted by the development of free cash flow in the third quarter. The strong free cash flow we are targeting in the fourth quarter will increase our NFA accordingly.
Given our strong balance sheet, the BMW Group remains committed to its shareholder return strategy, which includes both dividend payments and share buybacks. On October 25th, we successfully completed tranche three of our ongoing share buyback program. We will continue with this program following the completion of a separate buyback of common shares designated for our employee share program.
We anticipate that our current program of EUR 2 billion will be finalized by April next year, more than half a year earlier than initially planned. Additionally, the Board of Management of BMW AG plans to propose an agenda item at the upcoming AGM, seeking a new authorization to acquire treasury shares amounting to up to 10% of share capital for the next five years.
Let's move on to the financial services segment. The positive trend in new business continued in the third quarter for both new and used vehicles. In the first nine months, more than 1.25 million new leasing and financing contracts were concluded. This represents a significant increase of 12.5% year on year. The volume of new business, including all new financing and leasing contracts, also saw significant growth of 13.6% to EUR 46.5 billion.
The total volume, a value of all contracts managed, reached almost EUR 144 billion at the end of September. Segment earnings for the first nine months were 12.4% lower year on year at EUR 2.15 billion. This decrease resulted mainly from lower income from the resale of end-of-lease vehicles, as well as measurement effects related to the evaluation of interest rate derivatives.
During the reporting period, the credit loss ratio stood at 0.26% across the entire credit portfolio. In the motorcycle segment, the ongoing competitive situation across four markets affected the volume development. Deliveries experienced a slight year-on-year decrease of 3.2% in the third quarter. Through September, they were on previous year's level. The segment's third quarter EBIT totaled EUR 27 million. The EBIT margin came in at 3.8% for the third quarter and 9.5% for the nine-month period.
Ladies and gentlemen, in the fourth quarter, we expect the usual seasonality of fixed costs and ongoing muted demand in China. But we will also see volumes well above Q3 and an improved product mix as the completion of technical measures progresses. Therefore, we confirm the adjusted full-year guidance we communicated in September for the group and for all segments.
Group earnings before tax will decrease significantly. In the automotive segment, we are planning for a slight decrease in deliveries compared to last year. A share of all electric vehicles will increase significantly. We expect to see the EBIT margin in a corridor between 6% and 7%. The return on capital employed should come in between 11% and 13%. Deliveries in the motorcycle segment are projected to be on last year's level.
The EBIT margin is forecast to be in a range between 6% and 7%, with a return on capital employed between 14% and 16%. In the financial services segment, return on equity should be between 15% and 18% for the full year. Our guidance assumes that geopolitical and macroeconomic conditions will not deteriorate significantly. Ladies and gentlemen, the BMW Group remains fully focused on achieving our short-term results without compromising our long-term strategic objectives.
Our flexible approach allows us to calibrate to changing market dynamics and to constantly fine-tune our cost structures across the company. At the same time, we remain committed to invest in strategic projects that will secure enduring future success. Our performance in the third quarter was impacted by one-time headwinds, as well as ongoing challenges in the Chinese market.
However, the sales development of our all-electric vehicles in the third quarter clearly demonstrates the continued success in implementing our electrification strategy. This year, we are setting a decisive course for the future of our company. To that end, both research and development spending and capital expenditure will peak in 2024 as planned. We expect our R&D ratio for the full year to exceed 5%, with a CapEx ratio of more than 6%.
With the Neue Klasse, we will take a significant step forward in design, battery technology, software, and tech stack. This ensures that we will capitalize on the full value generation potential as it rolls out across the whole product portfolio, starting at the end of next year. The Neue Klasse will shape the future of our company and deliver sustained success for the benefit of all stakeholders. Thank you.
Thank you very much, Walter. Now over to our CEO, Oliver Zipse. Oliver, please go ahead.
Ladies and gentlemen, at the BMW Group, we always focus on opportunities in the current market, as well as on our long-term success. We ensure this by acting in a flexible, albeit forward-looking manner. After the extraordinary challenges in the third quarter, as explained by Walter Mertl, we are already looking ahead. In the fourth quarter, we are back on track for stronger earnings in order to achieve our annual targets, despite planned high upfront expenditures.
We continuously adapt to changes in our environment without ever reacting rashly. We continue to steer our strategic course into the future while avoiding short-term adjustments that could jeopardize our long-term success. Our commitment to technology openness has proven its value and is paying off today more than ever.
Our global positioning across sales, production, and our supplier network secures us access to markets worldwide. BMW is a global company with a strong presence in all relevant economic regions. I regularly take the time to see this for myself. This doesn't work at a distance, but it's best done when you are on the ground. So, over the past three months,
I visited markets in all of our four sales regions in Europe, the Americas, in China, and our emerging fourth-pillar region, which includes Southeast Asia and the Middle East, among others. Our global approach has often allowed us to compensate for fluctuating demand in individual markets. Of course, we are monitoring current developments in China very closely. The economic conditions there are challenging, and that applies to all market participants.
However, it is our ambition to perform better in the market than our competitors, even in a challenging environment. The key to this lies in our highly attractive product lineup. This enabled the BMW brand to deliver solid sales growth in Europe in the first nine months of the year. With sales up by over 7%, we are significantly outperforming the total European market and expanding our market share.
There was particularly high demand in the UK, with an increase of 21%, in Spain, plus 19%, in Italy, up 17%, and in France, with a gain of 14%. And the BMW brand is also growing in markets such as South Korea, Australia, and India. Global demand for our high-margin models in the upper vehicle segments remains stable. The high-performance cars of BMW M reported sales growth of 2% in the year to the end of September.
This month also sees the market launch of the latest M model many fans have been waiting for, the BMW M5 Touring. We're constantly expanding our product range across all drive variants in line with customer demand. Our highly flexible production network allows us to tap market potential. This applies in particular to our all-electric models. In virtually every relevant segment, the BMW Group has at least one pure electric vehicle.
Across BMW Mini and Rolls-Royce, customers have a choice of more than 15 different models. This means that the BMW Group has one of the broadest ranges of fully electric vehicles among its competitors. Sales in the first nine months of the year underscore the success of the BMW Group's electrification strategy.
While other manufacturers, including some that only produce electric cars, are seeing a significant decrease in sales, battery electric vehicles remain a growth driver for us in 2024. By the end of September, we had sold almost 300,000 BEVs, an increase of more than 19% compared to the same period of last year. In the third quarter, battery electric vehicles already accounted for 19% of the BMW Group's total sales.
The BMW brand's fully electric models performed particularly well in Europe, with sales climbing 36% in the first nine months. Globally, BMW's strong BEV portfolio fed growth in deliveries of more than 22%. The BMW i4 remains the brand's most popular electric vehicle. It is closely followed by the BMW iX1, which, like the BMW i7, recorded double-digit growth. The first all-electric BMW iX2 is also on track for success following its market launch.
The new all-electric Mini models, led by the Mini Cooper SE, are also being very well received. With a sales increase of 54%, Mini BEVs experienced highly dynamic growth in the third quarter, and starting this month, the all-electric Mini Aceman will also be available in Europe, and for the first time, Mini is also electrifying its John Cooper Works variants.
The Mini John Cooper Works Electric and the Mini John Cooper Works Aceman celebrated their premiere at the Paris Motor Show. Performance and driving dynamics are the clear focal point in both models. From January 2025 onwards, they will captivate even the most dedicated motorsports fans. Looking ahead to the next year, we anticipate another significant increase in sales of fully and partially electrified vehicles, and for that reason, we see no need to modify or delay the European Union's stricter CO2 fleet targets for 2025.
We have been working intensely to meet these new fleet targets for a very long time. We are therefore confident that we will also meet the stricter requirements for 2025, as we have consistently in the last years. But nevertheless, we believe that a comprehensive and critical review of CO2 fleet legislation in the EU following 2025 is absolutely essential.
And what matters most is every ton of CO2 we can save today, not sometimes in the future. This is why the use of low CO2 fuels, such as e-fuels, E25, or HVO100, should also be revisited. These fuels could immediately improve the carbon footprint of the more than 250 million vehicles already on the road in the European Union. By 2030, all-electric vehicles will account for more than 50% of our total sales. The rollout of our all-electric Neue Klasse will play an important part in this.
The Neue Klasse is now entering the final straight, and we are keeping this forward-looking project on track. With a new design, the next generation of electric drives, and a comprehensive digital experience, the Neue Klasse will set completely new standards. In just under a year, the first series production SAV model of the Neue Klasse will roll off the line at our new plant in Debrecen in Hungary.
This will soon be followed by a sporty sedan from our new main plant in Munich. Preparations for the launch are progressing well. In early October, we reached an important milestone in Debrecen with the start of pre-series production. At plant Landshut, pre-series production of electric engine housing for the Neue Klasse has already begun, and in Munich, construction of the new assembly for the Neue Klasse is progressing in parallel with ongoing production.
With the Neue Klasse, we will elevate our entire vehicle portfolio to a whole new level of innovation. This is possible thanks to our use of technology clusters, which can be integrated into every future vehicle. In this way, all our products will benefit from the technological leaps we will achieve with the Neue Klasse. This applies not only to our all-electric vehicles, but across all drive technologies.
Our continued systematic implementation of technology openness also ensures that we will continue to offer the latest ICE models in the coming years. In 2028, we will introduce another element to our drivetrain portfolio, the BMW Group's first series-produced fuel cell vehicle. Hydrogen will play an increasingly important role in decarbonization. This makes vehicles with a fuel cell drivetrain a logical complement to established drive technologies.
To develop the new generation of fuel cell drivetrains, we are deepening our long-standing cooperation with Toyota. We announced this in September together with Toyota CEO Koji Sato. This collaboration also shares the goal of expanding infrastructure for hydrogen refueling and electric vehicle charging. Ladies and gentlemen, the European automotive industry currently faces fundamentally different challenges from those we have faced in the past.
We're not dealing with a singular overarching occurrence. Instead, we're facing a tangle of critical influencing factors that keep growing in number. In such a phase, we do not need short-term incentives that only create a fleeting impact. What global companies truly need is a reliable and technology-open framework for progress and prosperity. It should be up to each company to find the best technological solutions to meet legal requirements and to further reduce CO2 emissions.
Instead, more and more obstacles are constantly being placed in the way of existing successful technologies. As a result, potential for reducing CO2 emissions cannot be utilized. At the same time, decisions are being made that even harm the industry. The introduction of tariffs on electric vehicles imported into the EU from China is just one example. Import duties do not make European manufacturers any more competitive.
On the contrary, they undermine the business models of companies that operate globally, and since these tariffs mainly affect small electric cars built by European manufacturers, they could even impede the growth of e-mobility. Measures like these are also inconsistent with the EU value of free trade. Free movement of goods is a key success factor for economic growth, not just within the European Union, but also on a global level.
Free trade remains a guiding principle for the BMW Group, and we will continue to advocate for it. Because protectionism always carries the risk that measures will provoke countermeasures, ultimately hurting everyone involved rather than benefiting any of them. We operate as a global player, making it all the more important to maintain our strategy of balanced global positioning. This applies as much to our sales and production network as to our selection of suppliers.
We continue to systematically expand our local for local approach, making our supply chains more resilient and improving our access to different market regions. While Germany's future as an industrial location may be questioned by some, we are making investments here. In Irlbach-Straßkirchen in Bavaria, we are building a new assembly plant for the latest generation of high-voltage batteries. They will be used for the first time in the Neue Klasse.
In this way, we are already laying the foundation today for successful growth in the future. Ladies and gentlemen, the past quarter, we faced a series of extraordinary challenges. One of the BMW Group's biggest strengths is our ability to consistently find the right solutions and implement the necessary steps swiftly and efficiently. Our company maintains a robust global presence. Our strategic direction for the future is solid, and we are carefully adapting our approach to changing conditions if necessary and planning for a range of scenarios.
We continue to be guided by these developments we can realistically expect to see in different regions of the world. The fourth quarter will demonstrate that our measures, despite all the ongoing challenges, yield positive results. We therefore approach the final quarter of the current financial year with a sense of confidence.
We are striking a balance between securing short-term earnings and long-term success. This year, we are investing more than ever in new products, technologies, and our plans so that we can continue the BMW success story with the Neue Klasse from next year onwards. Thank you.
Thank you very much, Oliver. Ladies and gentlemen, we now have a short break before we move on to the Q&A session. See you in five minutes. Dear colleagues, welcome back to our second part of our conference. We're going to continue in German now after the short break. We're looking forward to your questions. First of all, there are some technical instructions before we're going to get started with the first question. So now let's hear the technical instructions. Ladies and gentlemen, we're going to start with a Q&A session now. If you want to ask a question, please raise your hand.
And if you have signed in, please press star and nine. And then one after another, you will have the opportunity to ask your question. As soon as you have given us your name, or as soon as you hear your name, you can ask your question. To withdraw your question, please lower your hand. And when you're using your telephone, press asterisk and nine. Now we're going to have the first question. The first question is by Mr. Henning Hansen from the Manager Magazin. Please switch on your mic.
Good morning. I have two questions. They're both addressed to Mr. Mertl. You said earlier that you're supporting the Chinese dealers in two ways. However, I have not understood clearly to what extent of your support you're talking about. Can you please elaborate on that so that I understand it better this time?
Then secondly, you said that you have made good progress in exchanging the brake components. I would like to know in how many cars the brakes will have to be exchanged and in exchange of hardware, so to speak. What percentage of all cars, what you're going to be delivered? In what percentage of cars do the brakes need to be exchanged?
Thank you, Mr. Hansen. I understood both questions. Walter, it's your turn. Good morning, Mr. Hansen. About the question about China. So far in the first quarter, there was no support for the dealers. After long discussions in the third quarter, we agreed on supportive measures. These supportive measures consist of two parts. In one way, we want to increase the profitability of the dealers by giving them a discount.
And then we also want to support their liquidity that also decreased our free cash flow in Q3. And then we also paid out some bonus payments, but that was a one-off. And we also support them with our financial services as far as their liquidity goes. And about the brake situation, in the worst case, we would be talking about 1.2 million vehicles, as we have mentioned in September. 1.5 million cars have been affected. 1.2 million had already been delivered.
And so in some markets, we need to replace the brakes for all of the cars out there and in other areas of the world, according to what our software says. And that's why we have made some money available for that.
Mr. Walter Mertl, thank you.
Next question, please. The next question is by Markus Fasse from Handelsblatt. Please switch on your mic. Good morning, gentlemen.
I've got two questions about China and the USA. First of all, about China once again. You said you saw a decrease in demand of 30%. You're not the only ones, but 30% is a lot. Can you elaborate where you have been affected, in which segments, and what your countermeasures are? And then I have seen that also there was a write-off connected with BBA. Can you also explain more on that, why there were some changes here? And then I also have a question about the U.S. elections.
We don't know what the effects will be exactly, but they will be significant. Can you tell us why this market is so important for BMW? What do you expect in the years to come, independent of who's going to be the president, as far as drive trains go, growth goes, and potential investment of BMW goes on? All of that depends, and also what your experience has been with Republican administrations.
Thank you, Mr. Fasse. We have received your questions. Let's get started with the United States in general. A first general statement about the election, as you said, Mr. Fasse. There's no clear final result yet. We will have to wait and see, and in the past, we did not comment on the election results, and it is not our task to do this time either. The BMW Group has been, for almost 50 years, a responsible company in the United States, and during all that time, with all the governments, whether they were Democratic or Republican, we have always been cooperating very well. This is my statement so far about the election. Then about the sales in China, I will pass on to Mr. Mertl and to Mr. Zipse later. Walter Mertl.
Good morning, Mr. Fasse. About the sales in China in Q3, there were some impacts in Q3. We had a decrease of 4.5% in the first six months. Of the 30%, it's mostly due to IBS. We don't know whether the car, which we were not able to sell, could have been sold. We cannot identify that. Half of it is due to IBS. About the write-offs of BBA, when we bought the additional shares of 25%, we had purchase price allocations.
That's a regular write-off since the year 2022, EUR 1.3 billion-EUR 1.4 billion per year. Since we have this purchase price allocation in Renminbi, all of this is as planned, the regular write-off until the year 2028. There will be a write-off of EUR 300 million-EUR 400 million in every quarter as of now. And then we have the last question about the United States in general, why this market is so important for us. And I would like to ask Mr. Zipse to answer that. Mr. Fasse,
good morning. Well, the U.S. market traditionally is of very great importance, and it hasn't changed. If you look at the products which are being manufactured in the U.S., how well they fit the market, whether the X5, X6, X7, but also the X3, where we just started production. And our customers very much like these cars in the United States, but also in the rest of the world. And when we look at the month of October, and you will see that we have said the fourth quarter will not look as bad for us. And let me just mention some figures from October. In the U.S., we have almost sold 37,000 vehicles.
These are over 7,000 vehicles more than last year. So things are going very well over there. And that makes us also confident that some other burden here or there with the brakes, that we will be able to overcome this problem relatively quickly. So the United States, just like Europe and China, they all remain very important for us. And at BMW, we have developed the capability to offer or to play a role in the market in all these three big world markets. And nothing is changing when there's a new government. Because when there are changes in geopolitics, then it is important that you are locally present, and we are there.
Thank you, Mr. Fasse. And let's hear the next question. The next question is by Christina Amann by Thomson Reuters.
Good morning. I hope I switched on my mic. Yes, we can hear you. Great. I've got a question about the prices in China. When we look at their sales decrease, Mr. Mertl, you said the largest part was due to the IBS situation, but it's still a significant decrease. Can you tell us something about the pricing in China and give us an outlook when will things recover? And then also maybe if you could tell us also something about your expectations for next year, what the forecast will be for BMW for next year. And then also when it comes to political changes in the U.S., when electric cars are not as sought after anymore, and when you have your largest investment project in that area.
Well, Ms. Amann, thank you so much. Mr. Mertl is going to start.
Good morning, Ms. Amann. In China, over the past months, the transaction prices, which are under the responsibility of the dealers, they have changed differently. In June, they went down, and then they stabilized in the months after. And then sometimes they also went up by two, three points. And then in September, they went up to the level of June again. So there's some fluctuation, and there is a stimulus in different provinces, which the dealers are using.
And this is how it will continue. And during that time, we're supporting our dealers in profitability as well as in liquidity, as I said earlier. And in October, the October figures are on the level of June. So things are stabilizing, and we're seeing a growth again. And now I would like to ask Mr. Zipse that we don't do a forecast for 2025 yet.
About the future of BAFSA and the global situation in the USA. Good morning. We don't do any forecasts for 2025 yet, but let me give you some background information. First of all, we've got the X3 at BMW. That was traditionally a very strong product, and it is a new product. We're quite confident because it is a big technological leap. Even though it's an ICE, you should never underestimate this vehicle.
Especially when there will be a change in growth rates in the BAFSA, that will help this product. That's a big tailwind for us. Then also the Mini has all the vehicles next year, all the vehicles which we have announced, whether it's the Aceman, the Countryman, the Cooper as a combustion engine, or fully electric. All of that will give us some tailwind.
On the product side, and as you know, at BMW, it's always about products. Apart from the Neue Klasse, we are quite confident that things will stabilize for us. You can see that I'm trying to instill some confidence. As far as the U.S. market goes, let me mention a figure from the month of October because it's very up-to-date information. We have sold 3,500 BAFSA in one month.
That means more than 10% more than last year. So we need to look very closely at what is really happening and general trends. It's always difficult to generalize them, and also in Germany, there is less demand, even less demand than in other regions, and there's no big debate whether the Neue Klasse will be launched at the right time. It is actually the absolutely right time because the worldwide markets are growing. There are some shifts between the regions. There are regions with slower growth. And of course, there are also shifts between manufacturers. And as we have heard earlier, we're doing quite well. We're well positioned.
Thank you, gentlemen. Thank you, Ms. Amann. Next question, please. The next question is by Wilfried Eckl-Dorna, who's working for Bloomberg News.
Good morning, everybody. Mr. Zipse, Mr. Mertl, I have a very short question, which it was asked before, but it wasn't properly answered. I wanted to know about the situation in China. What is your forecast for the sales, not just electric vehicles, but for the market as a whole for the remainder of this year? And when do you expect that there will be a recovery of the market there? That's all.
Thank you, Mr. Eckl-Dorna. Mr. Mertl will answer that.
About the overall market, we believe the overall market has about a 1% increase compared to last year. And when we look at BMW, we can stress that we have now our X3. The Mini is going to be fully available. The X3 is being launched, and our 5 Series is doing better every month. And therefore, we can see at the end of the year a different figure compared to the third quarter. And also in China, the IBS problem is solved piece by piece, and we're getting better every month. And we see that in our sales figures, and we will hopefully be able to report like that in the end as well.
Next question, please. The next question is by Daniel Zwick at Welt am Sonntag.
Good morning. I've got a question about tariffs. Mr. Zipse, you mentioned protectionism before, and now the EU has introduced these penalty tariffs on Chinese electric cars. What does that mean for you? Is the iX3 going to be produced in Europe from now on? And then also when we look in the other direction, Trump declared himself the winner now and has also already received congratulations from other heads of state and government. So it seems to be pretty clear. And he has also announced tariffs or threatened with tariffs on the import of cars from Europe. So what would that mean for you? Would you have to invest more in the U.S. even?
Thank you. Mr. Zipse, please.
Well, Mr. Zwick, we expected your question. Of course, the tariffs have been adopted, but negotiations are ongoing. At the moment, we could say that both sides have strengthened their negotiation position. We are involved in this whole process. I'm on the phone with parties concerned, and our statement remains that these tariffs will see no winner. Whenever you have bilateral relations which are being jeopardized, and we believe that when new import tariffs are being introduced, the E.U. Commission will have a detrimental impact on free trade, and it might lead to a trade conflict.
The European Commission is aware. They know that if they adhere to their decision, it will be a bad decision, and they know that themselves. So I remain hopeful, and the iX3 is no longer an import product. We're mostly affected when it comes to the Mini, the Mini Cooper Electric, and the Mini Aceman Electric. That is the main topic, and what the price design will be, what it could be, that will remain to be seen. It has a negative effect on the market, and it affects negatively those customers who want to buy electric cars here. So let me say that it's actually they're shooting themselves in their own leg, if I may put it this way. So much about that.
Thank you. Thank you, Mr. Zwick. Next question, please. Next question is by Stephen Wilmot from the Wall Street Journal. Stephen, are you there?
I have two questions. One is, in the event of higher tariffs on vehicle shipments to the U.S., will you make adjustments to your production plans? And secondly, I want to ask what the market share trend is in China. What was your market share in the third quarter, and how did that compare to the same quarter last year? Thank you.
I think we should not speculate whether tariffs are going to be introduced or not because there's a lot of negotiation tactics in play here. We should not believe that new tariffs will definitely come. Even if the main volume which we're selling in the U.S. is being produced in the U.S., so whether it's the X3, X4, X5, X6, X7, they're all being manufactured in the U.S., and they make up the largest part of our volume. If we see higher volumes because of this situation, then we're well prepared for that. Thank you. Second part of the question was about China. Currently in China, we have 3.3% market share with BMW and Mini. As of September, we lost half a percentage point. In the quarter, we lost 1%, and that is mainly due to IBS. So in the fourth quarter, you will see a recovery. We will regain market share as soon as we're selling more vehicles in the fourth quarter again.
Thank you so much. Next question, please. Next question will be by Michael Gerster, Automobilwoche.
Good morning. Can you all hear me? Yes, we can. I also have a question about China and about the long-term trend. When it comes to combustion engines, the market is decreasing. When it comes to electric vehicles, the German manufacturers don't play a major role. And the CFO of Porsche, Lutz Meschke, said that there's a structural change in demand. So they're expecting that the Chinese market will not recover in the long term. We all have the same problems here.
The question is whether you are also prepared for such a scenario so that you're saying that China is not going to recover or get back to the figures we have seen previously, and whether you have thought whether you can also move into other markets and which other markets could exist. Are there any new markets which you could tap into? Another short question about the fuel cell vehicles which you have planned. Here, my question is, what are the main markets you have in mind there? And then also, what figures you're expecting per year for these fuel cell vehicles?
Thank you, Mr. Gerster. I will pass this question on to Mr. Zipse.
Mr. Gerster, good morning. Let's take a look at the figures, first of all, because not every competitor is the same. Year-to-date in China, when it comes to pure BEV sales, we have 83,011 units, including October. That is a growth, almost 5,000 units more compared to last year, so we're not shrinking, and we have over 80,000 units, so we do play a role. Of course, we have a low market share, but only between 3% and 4%, and that is also the case here.
The fact that this does not correspond to our growth ambitions, that is true. We have reduced them, but we're still growing, and we do play a role, and we want to expand that with a Neue Klasse, a completely new technology cluster, which will elevate BMW to a new level, and then secondly, it is important to recognize that the market in China is growing. The market is not shrinking. The question is, who are the competitors?
The capacities and market ambitions will be adjusted. They're not as high as last year. But a scenario where we don't play a role anymore, that is absolutely not true. It is a huge market for us, and it's working quite well. Of course, there's a price pressure in the lower price segments, especially in these lower price segments. There's price pressure because of the Chinese manufacturers, and we're adjusting our prices. We are doing that with a Mini, which is produced locally. We are there for this reason so that we can remain competitive. To sum up, the growth has slowed. We're adjusting our capacities, but it is still at a very high level. And one more thing I would like to add: the strategy of China, the electric vehicle strategy, has different pillars. There are the pure electric vehicles. It's going very well.
A lot of investments have been made, and that is working. And the second part is long-range plug-in hybrids in all shapes and sizes. And we're also a part of that. And the third pillar is hydrogen. A lot of people are overlooking that. China is the only nation. They're saying we have three pillars, and they all have their limits. And that's why China is playing a role there as well.
And I was just in the Middle East where we're also making major investments in order to offer hydrogen on the supply side. And in 2028, we will introduce a vehicle, and then there will be demand for hydrogen. And we believe no matter where we're going to produce the vehicles, we believe that hydrogen will be the third pillar. In Germany, you don't notice that as much, but abroad, you can see that that is going to be an important market growth segment in the next decade.
Thank you, Mr. Zipse. Next question, please. The next question is by Gabriel Wirth from BR.
Can you hear me?
Yeah. Yeah. We can hear you.
Great. I have a question for Mr. Zipse. Did I understand you correctly? Unlike the competitors, you want to adhere to the CO2 targets within the EU.
Yes. Yeah. That was the answer of Mr. Oliver Zipse, the CEO of BMW. Yeah. Please, can you elaborate on that? Can you, Mr. Wirth? Mr. Wirth, I think the answer, yes, is 100% clear, but I can comment on that. I just wanted to make it clear so that everybody understands it. I need that for the BR radio in German.
I need a clear answer for the radio. Okay. Let me try that once again. Yes. Yes. We adhere to that. And let me tell you why. Because for over five years, these goals have been set. They didn't develop overnight. And people were able to adjust their product portfolio. And in the European market, nothing happens overnight. Things take a long time to develop. And our BEV market is growing. We have the plug-in hybrids, and we also have improved ICE engine cars. Also, the ICE vehicles have been improved as far as their fuel consumption goes with the 48-volt network. And we're also thinking in different scenarios. Of course, the market can look different. But in all the different scenarios, it shows us that our product portfolio will meet its targets. And therefore, we believe we are preparing ourselves.
We don't want an adjustment in 2025, but what we want to see is a review in 2025 for the years after as of 2030 onward, where we will—I mean, next year, we're only talking about a decrease of the fuel consumption of 15%. But in 2030, we're talking about minus 55%. And that is going to be an enormous step in one year. And we're not talking about 2035 when we're talking about minus 100%. So we will be able to achieve that, but we're still open for review whether these short-time segments actually make sense and whether it's feasible or not. So does that answer your question, Mr. Wirth?
Yes.
And next question, please. Next question is by Regina Klier, Passauer Neue Presse.
Good morning. I hope you can hear me. I would like to know about the employment figures, especially when it comes to Germany. We have seen negative headlines in Germany. What are the plans for BMW for their employees? And you said, Mr. Zipse, before about the growing sales figures in Europe. What are the figures like for Germany? You talked about other European countries. You didn't talk about Germany. And a short question also about the hydrogen vehicles.
Will they be produced exclusively in the U.S., or will they also be produced in Europe? Thank you. Let's get started with the development of our employee figures. It is well known that unlike other companies, we have still employed new employees. We had a growth in our guidance. We're taking on people for all new skills, which we need, and especially when it comes to all things digital, also for the new technologies.
We have these people on board now. And that means without giving out a guidance for next year already, but since we already have everybody on board, so we will continue in that vein. Thank you so much. Mr. Zipse, please. You asked about the sales figures in Germany. Well, the current figures, including October, let me just read that out. Per month in Germany, we have sold more than 184,000 vehicles, 6,400 more than last year, about 3% more.
And in the month of October, 19,000. 19,000, that's almost 2,300 more, over a 10% growth in October. So things are positive. And we're also seeing the same picture for the BEVs here. As of October, we sold about 29,500 year-to-date. This is also more than in the previous year. So the overall market is growing for us as well as the BEV market in Germany.
So we don't agree that everything is really that the outlook is bleak. On the contrary, our product portfolio helps us to strengthen our market share. And about the production sites for hydrogen, we will announce that whenever we are ready. But of course, we're continuing our cooperation with Toyota here as well.
And our last question now is by Automotive News Europe, Mr. Nick Gibbs.
Thank you very much for taking my call. I had a question about the targets. You're on track to, as you said, hit the 2025 targets, but to want to review CO2 targets for 2030. Which models do you think will be hardest to switch to BEV from ICE? Which segments? Or do you imagine keeping an ICE vehicle in each segment? And my second, actually, yeah. I suppose the second question again would be about tariffs.
I mean, if Trump has said the most beautiful word in the dictionary is tariff, what could be the impact of those? Would you consider pushing more of your, maybe some of your sedan models into America for production there?
Thank you, Nick. We will answer in German. We will first hear from Mr. Zipse.
When you look at our product portfolio, in all segments, we have electric vehicles. When it comes to the Mini, we have three cars which we have switched to electric, apart from the ICEs. And then we have the X1, the X2, the i4. We have the iX and the 7 Series in electric, and also the 5 Series. Next year, we will have the Neue Klasse. So the question, which is the most difficult to change? Well, we're following the markets. In all segments, there's a demand for electric vehicles, but not exclusively.
So the question is not, where is it the hardest to switch? The question is rather, what is our overall product portfolio? And apart from our flexible approaches, we also are going to introduce the Neue Klasse, which is a new electric architecture. And why? Because the markets are large enough, so we can afford to do so. And in each and every segment, we will also offer highly efficient 48-volt ICEs. So there's no end date for that.
And about the tariffs in the United States, we talked about that earlier. We rather have an advantage because we have a big footprint in the United States for the United States and with the right vehicles. So we shouldn't be too nervous about that, of what could potentially happen. It might actually offer us a benefit. But it is much too early to discuss these tariffs now.
I think that concludes today's conference. Thank you for taking the time. Thank you for your participation. I conclude now this conference, and all the best from.