Late last week, Reuters reported that several top executives from BMW would be skipping the Paris Motor Show to figure out how the company will proceed in its electric car strategy.
Anonymous sources said the company is weighing whether it will change course on its electric i3 program, which only saw 25,000 deliveries last year. Some executives want the company to produce an electric Mini that would hit markets as soon as 2019—but that’s likely an expensive endeavor since the company would have to alter the Mini platform to house a giant battery and upgrade its factories to accommodate that production. One anonymous source told Reuters it would be more expensive to retool the i3 platform for a Mini body than to re-engineer the Mini platform to support the kind of battery it would need to be all-electric.
Still, government regulation in the US and Europe is increasingly favoring low- and zero-emissions vehicles, and the popularity of Tesla’s Model 3—which received hundreds of thousands of reservations in the week after it was announced—are encouraging companies to invest in electric vehicles.
Other executives are reluctant to invest more in electric vehicles until i3 sales increase. BMW recently announced that it would increase battery capacity on the i3 by 50 percent with a 33kWh battery, allowing 100 miles of range on a full charge.
Also there’s the price of BMW cars versus that of Minis to consider. “Senior managers fear they will not recoup the investment costs with Mini-branded cars because these do not command the same sticker prices as BMW-labelled cars,” an anonymous source told the news outlet.
But BMW will be competing not just with electric vehicle automaker Tesla but with more traditional competitors like Mercedes-Benz, Volkswagen, and even Chevrolet’s Bolt program. The Bolt is expected to cost $30,000 and have a range of about 200 miles. Volkswagen, reeling from its diesel emissions scandal, has promised to deliver 30 new electric vehicles by 2025.
“How does the company expand into the loss-making segment of electric cars and retain its industry-leading profitability. That’s essentially the question facing management now,” one source told Reuters.