By Christoph Steitz FRANKFURT (Reuters) -Potential import tariffs under the U.S. presidency of Donald Trump may benefit BMW, its CEO said on Wednesday, even as shares in the German premium carmaker and its rivals fell due to concerns the sector would be hurt by escalating trade disputes.

Slowing demand in China led to steep falls in quarterly profit for Toyota, Honda and BMW, dragging even the strongest carmakers into a broader downturn hitting the sector. Until now, Japan’s Toyota and Honda had outperformed their European and US rivals due to strong hybrid and petrol sales in North America.

BMW said Wednesday it faced "extraordinary challenges" as its quarterly profits plunged due to slumping Chinese sales and a vehicle recall, the latest sign of the crisis gripping Europe's auto sector.