BMW Group: Accelerating Electrification to Increase EV Share of Sales to Over 50%
Building EV assembly plant in Hungary; BBA and Spotlight Automotive setting up plants in China
2022/08/04
- Summary
- BMW Group targets to deliver 2 million EVs by 2025
- Transforming plants to ramp up EV production
- Autonomous driving technology: Level 2/3 systems to be developed with Qualcomm and Arriver
- Mobility services: BMW and Daimler to sell Share Now joint venture to Stellantis
- China: launching 5 EVs in 2022, BMW Brilliance is now fully consolidated
- BMW Group’s unit sales increase by 8.4% to 2.52 million units in 2021
- Revenues and EBIT for the Q1 2022 increase significantly due to consolidation of BMW Brilliance
- LMC Automotive Production Forecast: BMW’s light vehicle production expected to increase to 2.84 million units in 2025
Summary
The BMW Group is accelerating its electrification plan to achieve its target to reduce CO2 emissions per vehicle for every kilometer driven by at least 50% by 2030 compared to 2019. In 2022, the group is expected to launch 15 electric vehicle (EV) models, and have at least one EV model in about 90% of its current market segments. Total deliveries of EVs will be 2 million units by 2025, and over 50% of sales are expected to be EVs by 2030. The BMW Group plans to deliver a total of 10 million EVs over the next 10 years.
Along with its accelerated electrification plan, the BMW Group is transforming all of its plants, from the oldest Munich plant to the new plant in Debrecen to be open in 2025, to ramp up production capacity for EVs. The new plant in Debrecen will be a dedicated EV assembly plant with plans to start production of the next-generation EV series, Neue Klasse, in 2025. Regarding batteries for EVs, the group is raising its own production capacity of EV batteries, while it has signed partnership agreements with the Chinese battery manufacturer Contemporary Amperex Technology Co., Ltd. (CATL) and the U.S. battery development company Our Next Energy, Inc. (ONE) for supply of batteries.
In the field of autonomous driving technology, the BMW Group is partnering with multiple companies for joint development of the technology. The Canadian company BlackBerry signed an agreement with the BMW Group for supporting the development of level 2/2+ autonomous driving functions. The group also entered into an agreement with Qualcomm Technologies, Inc. and Arrriver Software for joint development of level 2/3 autonomous driving system technology.
As for mobility services, the BMW Group and Daimler AG agreed to merge their businesses in March 2018 and had been providing mobility services through five joint ventures. However, in May 2022, BMW and Daimler announced to sell their car sharing joint venture, Share Now, to Stellantis. The two companies will focus on Free Now multi-mobility app provider and Charge Now charging service operator.
In China, the BMW Group’s largest market, in 2022, the group will start operations at its three plants: the Lydia Plant that BMW Brilliance Automotive (BBA) built, the expanded BBA Dadong Plant, and the new plant that Spotlight Automotive is building. As the group is accelerating electrification in China as well, the Lydia plant will produce the i3, a midsize EV sedan exclusively for the Chinese market, and Spotlight Automotive’s new plant will assemble the MINI EV models. The group raised its shareholding in BBA to 75% in February 2022, and thus, BBA is now fully consolidated in the group’s financial statements.
The BMW Group’s global unit sales for 2021 increased by 8.4% year-over-year (y/y) to 2.52 million units. With the relatively small impact of the semiconductor shortage, the group earned the top spot for global deliveries among luxurious car brands for the first time in six years. In 2021, the group’s revenues increased by 12.4% y/y to EUR 111.24 billion, and EBIT grew by 177.4% to EUR 13.4 billion. For the first quarter of 2022, the group’s unit sales declined by 19.0% y/y to 542,000 units, while revenues increased by 16.3% y/y to EUR 31.14 billion, and EBIT rose by 12.1% y/y to EUR 3.39 billion. The group’s business results were supported by consolidation of BBA and its positive pricing. According to the BMW Group’s outlook released in July 2022, its global deliveries in 2022 will be in line with the previous year’s level with the impact of Russian invasion of Ukraine. The automotive segment’s revenues and EBIT are expected to increase significantly due to consolidation of BBA.
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| BMW i7 (BMW’s fully electric flagship sedan) to be launched in November 2022 (Source: BMW) | BMW i3 exclusively for China (fully electric midsize sedan) (Source: BMW) |
Related reports:
ScaleUp 360° Advanced Driver Assistance Systems Europe 2022 (Mar. 2022)
CES 2022: Major OEMs accelerate electric vehicle push (Feb. 2022)
Chinese market Q4 2021 (2)： Honda, BMW and Audi announce electrification strategy plans (Feb. 2022)
IAA Mobility 2021: Startup Companies at Munich Motor Show (Oct. 2021)
IAA Mobility 2021: BMW and Polestar emphasize high performance and sustainability (Oct. 2021)
CES 2021: EV and electrification technologies (Feb. 2021)
BMW Group's plan for 25% of sales to be electrified in Europe by 2021 (Dec. 2020)
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