Former Continental Subsidiary Aumovio Pays €350M Settlement Over BMW Brake Recall, Secures Over €1B in New Orders

German automotive supplier Aumovio has reached a settlement with BMW in their legal dispute concerning the Integrated Brake System (IBS). Under the agreement, Aumovio will pay BMW €350 million in compensation, to be paid in installments during the third and fourth quarters of 2024. This settlement fully and finally resolves all claims related to the IBS defect. The dispute originated in February 2024, when BMW identified a potential fault in an electronic component within the IBS supplied by Continental AG, which could affect vehicles’ ABS and ESP functions. In September of the same year, BMW initiated a global recall of approximately 1.53 million vehicles, spanning multiple BMW model series as well as Mini and Rolls-Royce brands. Additionally, around 300,000 already-produced vehicles could not be delivered due to this issue. Aumovio was formerly the automotive division of Continental AG and became an independent, publicly listed company in 2025. Continental had previously set aside tens of millions of euros in warranty provisions related to this matter, but the two parties had long disputed over responsibility for the defect. Concurrently with the settlement, both companies announced an expansion of their collaboration, with new orders totaling over €1 billion covering braking technologies and electronic solutions. The MK C2 brake system will continue to be supplied in high volumes through the mid-2030s. As a result of this settlement payment, Aumovio expects its adjusted EBIT and EBIT margin for the second quarter of 2024 to decline. Its full-year EBIT margin guidance has been revised downward from the previous range of 3.5%–5.0% to 3.0%–4.0%. Detailed financial results will be released on August 6.