German luxury carmaker BMW has reported a strong rise in sales for both its car and motorcycle units.

But its profits fell nevertheless due to an increased tax bill.

The group said it was confident it would be able to meet its full-year sales and earnings target, despite the impact of the 11 September attacks.

BMW said it will "master" the economic fallout from 11 September and expects "the positive business development to continue in the fourth quarter."

Costly Mini launch

The results were better than analyst expectations and in sharp contrast to other European automakers like Renault and Fiat, which issued profit warnings after the attacks.

BMW reported a 29.4% fall in net profit to 315m euros ($284m) in the three months to September from the previous year, due mainly to a 68% rise in its tax bill to 252m euros.

Pre-tax profit before extraordinary items fell by 4.9% to 567m euros, while sales were up 9.8% at 8.2bn euros.

The car division reported a 26% fall in profits because of model changes in the 7-Series, rising research and development expenses, and the launch costs for the new Mini.

Hitting the target

The motorcycles division narrowed its pre-tax loss before extraordinary items to five million euros.

Car sales worldwide in the period rose 8.2% and motorcycles were up 15% more than in the period a year ago.

For the first nine months of the year, net profit shot up 63.3% and pre-tax profit before exceptionals was up 72.4% on a 7.1% rise in sales.

That meant BMW should be able to meet its target of selling more than 900,000 cars and Minis this year, 9% more than in 2000.