BMW Stock Reels from Index Removal as China Slump Overshadows European and US Sales Gains

BMW ejected from major indices triggers forced selling; China deliveries fall 20.4% in H1 2026. Stock near 52-week low despite EV pre-orders.

The BMW share is caught in a pincer movement. On one side, a technical blow: the carmaker was ejected from the S&P Europe 350 and the FTSE All-World index on 3 July, triggering mandatory selling by passive funds. On the other, the fundamental drag of a 20.4% drop in China deliveries in the first half of 2026, which more than erased solid growth in Europe and the United States. The stock closed Friday at €58.16 in Xetra trading — just 1.9% above its 52-week low of €57.06 set on 30 June.

The index expulsion stems from a corporate action rather than a performance review. BMW completed the conversion of its preference shares into ordinary shares after shareholders approved the move on 13 May. The 1:1 exchange increased the free float of common stock by roughly 19%, which pushed the company past the index providers' criteria for inclusion — both S&P Dow Jones Indices and FTSE Russell announced the removal on 1 July. For exchange-traded funds and other portfolios that mechanically track these benchmarks, the consequence is a wave of automatic selling that adds further supply to an already weak market.

That supply pressure meets deteriorating fundamentals. BMW has issued three profit warnings in two years, the latest in June, when it slashed its full-year margin guidance for the automotive segment to just 1-3% from an earlier target of 4-6%. The company cited the China crisis and the impact of the Middle East conflict as the main reasons. Deliveries in the world's largest auto market fell to 261,773 vehicles in the first half, while Europe managed a 5.4% gain to 496,651 and the US rose 3.9% to 200,661. Global volume dropped 4.2% to about 1.15 million units.

The brand mix shows a split: the core BMW marque slipped 6.2% to just over one million vehicles, while MINI posted its strongest six months ever with an 11.7% increase to 149,538 units. BMW Motorrad sales dipped 2.9% to 102,847.

Despite the bleak headline numbers, JPMorgan reiterated its "Overweight" rating on Friday with a price target of €82. The bank pointed to the order book for the iX3, the first model built on BMW's "Neue Klasse" electric vehicle architecture. That model is approaching 100,000 pre-orders, which analysts argue shows strong underlying demand for the new generation of EVs in Europe, even as the broader China slowdown weighs on sentiment.

BMW is also investing through the downturn. On 30 June it completed a $1.7 billion investment in its Spartanburg, South Carolina, plant and unveiled the new X5 there.

Past financial performance confirms the strain: net profit in 2025 fell to around €7.45 billion, down 3% year-on-year and the third consecutive decline. Revenue contracted 6.3% to €133.45 billion, with management attributing the drop to fierce competition in China.

Technically, the stock is deeply oversold. The relative strength index stands at 31.1 (primary source) or 30.8 (secondary) — both levels that typically signal a short-term bounce could be due. Yet the moving averages tell a longer-term story: the 50-day average at €69.12 and the 200-day at €82.03 sit well above the current price, confirming the downtrend. The market capitalisation has shrunk to €35.38 billion.

From the 52-week high of €97.90 reached on 9 December 2025, the shares have lost 40.59%. The year-to-date decline stands at 39.37%.

The next major milestones are the half-year results, due 30 July, and a capital markets day in September. Until then, the stock remains vulnerable to further swings as passive fund outflows combine with persistent China headwinds to test the support at the recent trough. Whether JPMorgan's bullish conviction can withstand the margin squeeze will become clearer when the company reports.