The German carmaker is the latest in its home sector to downgrade profits, with Mercedes-Benz cutting its outlook last week. Western automakers have struggled to keep pace with lower-cost domestic rivals in China, which has reduced their sales there and driven a rise in exports to Europe.
BMW reported an 11% drop in third-quarter pre-tax earnings on Wednesday to €2.1bn (£1.75bn). Sales in China fell 22% in the first nine months of the year, a decline the company said was in line with the broader downturn in that market.
"Current developments in our industry call for decisiveness and swift implementation. We will therefore specifically intensify and accelerate structural measures," chief executive Milan Nedeljković said. China "remains a key focus", he added, with the group's Neue Klasse revival of its model offering beginning in China this month with the launch of the iX3.
At the start of the year BMW had considered a margin of 4-6% possible. It blamed fourth-quarter costs tied to the restructuring for the downgrade. Because of the rapid launch of its new generation of electric vehicles, the company is writing off parts of its previous vehicle and technology generations and pricing in the costs of the redundancy programme.
BMW follows Volkswagen with painful restructuring costs caused by the rapidly changing market. The operating margin in BMW's core automotive business narrowed to 3.4%, beating analysts' forecast of 3.1% but declining from 5.2% a year earlier. Excluding restructuring charges, the margin would be above 2%, within its previous forecast range, the company said. BMW said it planned to cut management functions more quickly under its restructuring drive.
Revenue fell 6% to €30.4bn in the third quarter, hurt by declining sales in China. Mercedes-Benz also reported lower quarterly profits, while Porsche rebounded slightly but only after steep charges last year as it overhauls its model lineup and retreats from China.