BMW Hedges on Hybrids, Via Partnership with Peugeot

BMW and France’s PSA Peugeot Citroën issued a press release this week stating that the two companies, the longtime partners in engine development, would begin developing hybrid technologies together. Bloggers jumped to the conclusion that the move is a sign of strength and shows a renewed commitment about electric drive vehicles. They immediately started guessing about which models would get hybrid or plug-in hybrid drivetrains.

Is it going to be a hybrid 1-series? Will it be a gas-electric Mini? Maybe a hybrid Mini Clubman or even a Mini Countryman crossover SUV with a plug-in hybrid system?

(Actually, the conjecture started in October when BMW made a nearly identical preliminary announcement about the tie-up with PSA.)

It makes for a fun blog post to guess at possibly-could-be-maybe future vehicles, but of course, there’s no real evidence to back up those images in the crystal ball. According to the press release, the new venture, dubbed BMW Peugeot Citroën Electrification, vaguely states that the two companies will work on battery packs, generators, power electronics and chargers, and software for hybrid systems—the generic stuff that all hybrids need. Executives offered banal quotes, talking about “competitive advantages” and “cost structures.”

The announcement is more accurately interpreted as a sign of weakness—a fearful response to falling way behind in the hybrid space. In other words, instead of taking a bold step and making an investment, these companies don’t have to really commit to a full R&D budget and time commitment. After all, BMW is not a big company and would find it challenging to pursue the full range of advanced auto technologies all at the same time.

Have We Seen This Before?

BMW played the same card in 2005, when it glommed on to the hybrid technology project with General Motors and Daimler-Chrysler that yielded the two-mode hybrid system. At the time, Burkhard Goschel, BMW’s head of development, said, “The creation of a shared technology platform for hybrid drives will allow us to more quickly integrate the best technologies on the market.”

Six years later, what did this “quick integration” produce? One vehicle: the $90,000 BMW X6 SUV hybrid. How many of those did BMW sell in 2010? Ahem, 248 units. That puts its 2010 hybrid sales at No. 25 out of the 27 hybrids currently on the market. No. 26 was the $104,000 Lexus LS 600h L, followed by BMW’s other hybrid, the $103,000 BMW Hybrid 7 (using a system not developed in the G.M.-Daimler partnership), in dead last place.

As a point of reference, BMW sold 11,727 of its clean diesel vehicles in the U.S. in 2010— 7,925 units of the BMW X5 SUV and 3,892 units of the BMW 335d The company sells more of its diesel SUVs in month than all its hybrids in a year.

Meanwhile, BMW has launched an excellent web documentary series about the future of mobility. The first segment is about cars and the design of cities.

More Hope for EVs

If BMW’s hybrid efforts have been completely lame, at least it’s pure electric program has shown some life. The company has put a lot of effort into the Mini-E and ActiveE test programs—and the electric production model, the Megacity, is slated for 2013. With regard to the “BMW Peugeot Citroën Electrification” joint project, it’s more likely to yield components for that promising EV than a mainstream affordable hybrid Mini or 1-Series.

Most of all, the tie-up with PSA is a cost-saving hedge to keep hybrid development slowly moving forward at BMW, just in case regulations or market forces push the company to get serious about hybrids, rather than continuing to issuing press releases every few years about another joint development project.


  • Dom

    “As a point of reference, BMW sold 11,727 of its clean diesel vehicles in the U.S. in 2010— 7,925 units of the BMW X5 SUV and 3,892 units of the BMW 335d The company sells more of its diesel SUVs in month than all its hybrids in a year.”

    Right, so why should BMW focus more on hybirds when their diesel’s are much better sellers?

  • Anonymous

    Imagine this: when you drive in a vehicle, how often do you look into the rear view mirror, compared with how often you look thru your windshield?

    To stare at the sales numbers is like looking thru your side window, if not looking into the rear view mirror. Where you’re now is because of action or inaction of the past (from a second or two ago, to a minute or two ago – decisions like you pass the vehicle in front of you or not, you change lane or not). What the CEO of an automaker should focus is looking far ahead, thru’ the windshield, not the rear mirror.

  • Liam

    I have to say I am surprised Mini isn’t slightly more out ahead of the curve here. THey seem like a natural fit for hybrid and certainly should be leaning this way. I for one would rather see them focusing on this than on more advertising stunts. Although this billboard in chicago for the mini Countryman was pretty well timed with what that city is dealing with ….
    http://bssp.com/2011/news/mini-countryman-goes-well-over-ice/

  • Anonymous

    @anonymous #1:

    it’s very simple why people look at the past…

    “Those who cannot remember the past are condemned to repeat it.” – George Santayana

  • Anonymous

    What bunch of crap that video is. Germany isn’t America thank God. I want & will always demand a personal vehicle big enough to live life to the fullest. Not possible in a pea sized pod.

  • Shines

    A personal vehicle big enough to live life to the fullest!?! What does that mean? How about an example? Unless you are a race car driver or your vehicle is your work tool I hope you would be living your life outside of your vehicle…
    I agree that owning a car (and the kind of car you own) says something about who you are. Still – its main purpose is transportation.
    What’s big enough anyway? Mine’s big enough – I have 3 sons ;-D

  • jonak

    I considered a BMW 3 series for my new car, they are lovely, but the gas mileage is dreadful compared to a Prius, couldn’t bring myself to do it.

  • Anonymous

    Jonak

    Prius Gen-II has a lot smoother ride than BMW and also lot more spacious with the hatch which has 16 cu ft space.

    Prius Gen-III has even more space (22 cu ft) and 5 MPG more and it costs 10K less than BMW 3 Series / Benz C Series / Audi A4.

    People are just unaware.

  • Anonymous

    Mini sold only 2300 + units in Jan with 2 models (a 4 seater and a 5 seater). Unlike Landrover or Jaguar, they dont sell in 40 – 50K price tag. I dont think BMW can ever make a profit on Mini.

    The 2 other retro models are
    PT Cruiser – phased out in 2010.
    Chevy HHR – Still going strong with 7,000 + sales in Jan and it has comfortable seating for 5 with 25 cu ft space.

    Also its a Flexfuel since Model Year-2009, so u can make use of Ethanol as well. And HHR costs the same as Mini.

  • Anonymous

    “I want & will always demand a personal vehicle big enough to live life to the fullest.”

    Do you want to live in a Recreational Vehicle which gives 2-3 MPG. If every American wants to live like that, then American economy will go bankrupt. Then everyone will live under the bridge and ride a bike.

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