Following a similar projection by Daimler, BMW AG’s chief said it sees plug-in electrified vehicles (PEVs) making up from 15 to 25 percent its overall sales across the BMW and Mini brands within 10 years.
“With more range and more infrastructure being available, you’ll see more electrified vehicles,” chief executive Harald Krueger said during a Bloomberg Television interview in Los Angeles. “We need some time for this movement and development, but it’s nothing that’ll go away.”
Considering 2015’s sale of 2.25 million vehicles, and assuming further growth, this could project to well over half a million plug-ins per year when the company hits this ambitious stride. Today PEVs comprise just up 2 percent of its deliveries in a model line dominated by gasoline and diesel cars.
Not so incidentally, this sales projection is the exact same figure that Daimler CEO Dieter Zetsche stated at the Paris Motor Show.
Daimler previewed its new EQ electric car brand yesterday through the Generation EQ concept at the Paris Motor Show. Daimler expects electric cars to account for 15 to 25 percent of its global sales by 2025, Zetsche said during introduction of the Generation EQ concept.
What’s behind those massive PEV sales increases – from less than 1 percent of total new vehicle sales in the U.S. and 2 percent for BMW – up to as much as one quarter of deliveries? Krueger sees the technology going mainstream soon and a linchpin for staying competitive with others luxury makers, especially Mercedes-Benz and Tesla.
BMW has been disappointed enough in the sales of its i3 electric crossover vehicles to have kept top executives away from the Paris auto show to discuss the company’s electrified vehicle future. During those meetings, the company announced plans in Paris for an all-electric model for its Mini brand and an all-electric version of the BMW X3 sport utility vehicle.
These models are to join the i3 crossover all-electric (with a plug-in hybrid option), i8 supercar plug-in hybrid, and X5 plug-in hybrid SUV. U.S. sales of these models have lagged behind the Tesla Model S and X, Chevrolet Volt, and Nissan Leaf. Overall, BMW offers seven models worldwide with plug-in hybrid technology, including the $89,100 BMW 7-Series sedan.
BMW faces other key challenges pressing automakers to invest more in PEV technologies as government emissions reduction mandates hover on the horizon. Range is improving and costs are dropping as the Chevrolet Bolt and Tesla Model 3 among others over on the horizon. Daimler asserts it will beat those numbers in its upcoming EQ sub-brand models – with range almost twice as long as the Model 3. General Motors’ Opel division and Renault are expected to be rolling out more long-range PEVs in the near future.
BMW was counting on the i-Series sub-brand taking off, but has been disappointed in the sales figures since the i3 was launched in 2013. Limited driving range – now up to 124 miles, but previously only 81 – and the starting cost of $42,400 have made buyers beware with more affordable models with comparable range already on the market; and more recently with attention going over to the Bolt and Model 3.
For BMW, Volkswagen, and Daimler, the brand image and enthusiasm gained by Tesla in recent years seems to be as much behind their ambitious electric car product campaigns as the other factors previously mentioned. Tesla plants to boost production soon up to 500,000 vehicles per year, and has been effective at boosting its eco-friendly and cool image with much less spent on marketing than its rivals.
Some of Tesla’s rivals are setting up assembly lines that can produce electric drivetrains along with traditional vehicles with internal combustion engines. They’re hoping to be ready for growing demand PEVs but still need to have flexibility in place.
“Electric cars are very important for the future – if you’d like to offer sustainable mobility solutions then you need electrified products,” Krueger said. “But in the next couple of years you’ll still have combustion engines.”