BMW’s Electric Vehicles Will Make Up Half Of Sales By 2030—A Lower Target Than Some Peers - Forbes

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Topline

BMW said on Wednesday that one-half of its sales will comprise electric vehicles by 2030, a somewhat more conservative target compared to its automaker peers who are scrambling to produce more green cars to meet EU climate mandates.

Key Facts

BMW said about 90% of its vehicle lines will have all-electric models ready by 2023, while its popular MINI brand will be fully electric “by the early 2030s.”

The company’s all-electric BMW i4 electric sedan model–its first all-electric sports car–will be introduced three months ahead of schedule, while its iX electric SUV will go on sale by the end of this year.

By the end of 2025, BMW said it will have delivered 2 million fully electric vehicles across the world.

For 2021, BMW expects its operating profit margin to rise by 6%-8%, up from a 2.7% increase last year.

Crucial Quote

“We have started the new year with strong momentum and are aiming to return to pre-crisis levels as swiftly as possible–and go even further,” said Chief Executive Oliver Zipse.

Key Background

BMW’s EV targets are less ambitious compared to some of its peers like VW, which on Tuesday said it expects 70% of European sales to be electric by 2030. BMW chief Zipse said the company could accelerate its green plans if customer uptake exceeded expectations. Matthias Schmidt, automotive analyst at SchmidtMatthias in Berlin, told Forbes by email that BMW has a larger global exposure compared to other manufacturers such as Volvo which have announced they will cease making cars with internal combustible engines by 2030. “BMW and Daimler simply aren’t able to match [this 2030 end date] due to exposure in markets such as Brazil, Russia and India, and South Africa that are likely going to be slower in transforming to EVs...also they are likely happy to push their profitable [internal combustible engine cars] for as long as possible,” he added. BMW joins a flurry of other European and U.S. automakers which are ramping up EV productions by 2030 to meet tightening carbon emissions standards in Europe.

Tangent

The European Commission, the executive branch of the European Union, aims to have at least 30 million zero-emission vehicles on European roads by 2030 as part of its overall campaign to achieve carbon-neutrality in the EU by 2050. About 27% of EU greenhouse gas emissions come from the transport sector, the Commission estimates, adding: “The EU’s goal of climate neutrality by 2050 cannot be reached without introducing very ambitious measures to reduce transport’s reliance on fossil fuels.” Among other major car producers, Japan’s Toyota plans to have 40% of new global vehicle sales be electrified models by 2025 and increase that proportion to 70% by 2030. In February, Ford Motor said it planned to invest $1 billion in an EV manufacturing facility in Germany, as part of its goal to sell electric cars exclusively in Europe and the U.K. by 2030. General Motors said in late January that it will exclusively sell emission-free vehicles by 2035.

What To Watch For

Recent research by Wood Mackenzie, a consultancy group based in Edinburgh, Scotland, predicted that annual EV sales will reach 62 million by 2050–at which time some 700 million EVs will be on the roads. Auto sales in Europe (86%), China (81%) and North America (78%) will be dominated by EVs by that time, the group estimates.