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BMW Prepares Staff Talks After Profit Warning Amid China Slowdown and Rising Costs

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German luxury carmaker BMW is preparing discussions with employee representatives after issuing its latest profit warning and announcing plans to accelerate efficiency measures. The company cited continued weakness in the Chinese market and rising costs linked to the conflict involving Iran as key reasons for the weaker outlook.

Industry analysts believe BMW could consider reducing jobs in Europe while increasing efforts to localise production in North America and China. Although the company has not announced large-scale layoffs like some of its competitors, its workforce declined slightly in 2025 and is expected to shrink further this year.

BMW’s shares fell to their lowest level in nearly six years following the announcement. The automaker expects its global workforce to decrease by up to 5% by the end of 2026, potentially affecting around 7,700 positions. However, the company said the reduction will be achieved through natural attrition rather than compulsory job cuts.

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Mercedes-Benz becomes latest Western company to pull out of Russia

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Mercedes is the most recent foreign corporation to leave Russia in the wake of the February invasion of Ukraine. Early in March, the German company halted producing in and importing from the nation.

However, it has now announced that it will leave the Russian market and sell stock in its subsidiaries to a regional investor. Nissan, a Japanese company, left Russia earlier this month after Toyota and Renault did the same.

Nissan handed over its business to a state-owned organisation for a small amount, reportedly less than £1, at a loss of $700 million (£600 million).

Mercedes’ departure from Russia, according to Chief Financial Officer Harald Wilhelm, is not anticipated to have a materially negative impact on the company’s earnings.

The choice was made after major Western businesses, including Starbucks, McDonald’s, and Coca-Cola, left Russia earlier this year. In the early stages of the war, deliveries from other automakers, such as Jaguar Land Rover, General Motors, Aston Martin, and Rolls-Royce, were all stopped.

Mercedes was in line with other businesses when it stopped exports and suspended operations in Russia earlier this year, but many other automakers subsequently swiftly withdrew from the nation entirely, according to James Baggott, editor-in-chief of the industry website Car Dealer Magazine.

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