BMW guns for 50% growth in EV sales next year - TechCentral

BMW guns for 50% growth in EV sales next year

BMW is targeting another ambitious hike in plug-in hybrid and battery car sales next year to defend its position in the electric-car shift as competitors like Volkswagen ready their own battery line-ups.

The planned increase to about 150 000 cars sold would represent a 50% rise from this year, and a jump of about two-thirds from last year’s deliveries of green cars. BMW, an early mover in the electric-car shift with 2013’s i3, is facing increasing competition from rivals such as Mercedes-Benz and Volkswagen.

“We’ll definitely boost sales by a mid-double digit amount,’’ Klaus Froehlich, who heads development for BMW, told reporters in Munich. “This is to stay ahead of the competition that’s starting to do its own roll-out.‘’

Faced with tightening emissions regulation, BMW and other car makers are spending record amounts developing a more attractive suite of electric cars to kick-start sluggish consumer sales. The payoff remains uncertain, as high battery prices will squeeze returns compared to equivalent combustion engine vehicles — at least for a number of years. Demand for the vehicles remains at a fraction of total auto sales, with BMW’s target paling compared to total 2016 deliveries of 2.4m vehicles.

To help pay for the shift, BMW will start sales next year of the all-new X7 SUV and 8-Series coupe, priced at around €100 000. The expanded top-line segment will go head-to-head with Mercedes-Benz’s luxury variants like the S-Class coupe and Maybach sub-brand. Unlike Mercedes’s parent Daimler, also the world’s biggest commercial vehicle maker, or 12-brand behemoth Volkswagen, BMW has less opportunity to spread development costs of its suite of at least 12 all-electric cars by 2025. Volkswagen plans to have 50 battery cars by then.

“Our goal for the luxury segment in the next few years is taking more market share,” CEOHarald Krueger said in speech notes, adding that the new suite of luxury cars will be sold under the “Bayerische Motoren Werke” signature. “In 2018, we’re significantly enlarging our offering in this lucrative growth segment.”

Record roll-out

BMW is in the midst of a record roll-out of 40 all-new and revamped vehicles this year and next, seeking to wrest back global leadership of luxury car sales from Mercedes. Its Stuttgart, Germany-based rival overtook BMW last year for the first time in a decade, after overhauling a stodgy line-up with sportier styling and adding new models.

BMW’s electric push coincides with the biggest transformation for the industry in decades, drawing in a host of new competitors such as Tesla and Uber Technologies. BMW last month flagged it’ll spend €7bn on research and development this year, as much as 2011 and 2012 taken together.

BMW is feeling pressure from rivals like Tesla

Mercedes, meanwhile, said it’s targeting savings of €4bn by 2025, saying returns on electric cars could be roughly half of petrol and diesel vehicles for some years. The concerns about mastering the pressures have pushed the valuations of BMW, Daimler and Volkswagen to the bottom four rungs in the Dax Index.

BMW’s struggles with slow sales of the i3 city car, which used a lightweight carbon-fibre body for the first time in a mass-produced vehicle, prompted the car maker to dial back its electric ambitions and pause from adding more electric-only vehicles to its line-up.

Next year, it’s bringing out an electric Mini, followed by a battery-powered X3 SUV in 2020, adding electric powertrains to existing models rather than creating a distinct, separate line-up like Mercedes’s planned 10-vehicle EQ range. In the future, BMW will bundle its electric model versions under its ‘i’ brand, and has reserved naming rights for models iX1 through iX9.

“This can’t be just about showcase cars,” said Froehlich. “We have to boost profitability and keep prices on an acceptable level by delving very, very deeply into our cost structure.”  — Reported by Elisabeth Behrmann, (c) 2017 Bloomberg LP

1 Comment

  1. Ofentse Letsholo on

    Car range on a single charge is what matters when it comes to electric cars, if BMW can really push their ranges I bet their sales will go up. I would like to travel to Bloemfontein on a single charge with no worries at all, all the way from Mabopane, Tshwane.

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