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BMW has pledged to continue investing in combustion engine and hybrid technology as it warned of a “rollercoaster ride” in the US transition to electric vehicles following the return of Donald Trump as president.
Board member Jochen Goller said the group remained optimistic about sales of petrol and plug-in hybrids in the US even if demand for EVs slowed over the next few years on the back of policy changes under the new administration.
“I think it would be naive to believe that the move towards electrification is a one-way road. It will be a rollercoaster ride,” Goller, who is in charge of customer, brands and sales, told the Financial Times at BMW’s headquarters in Munich.
“This is why we are investing in our combustion engines,” he said. “We are investing in modern plug-in hybrids. And we will continue rolling out electric cars.”
BMW, which also owns the Rolls-Royce and Mini brands, has long been cautious about the pace of the global shift to EVs, developing a broad range of products long before growth in EV sales started to slow.
The company last year issued a profit warning after it was hit by sliding sales in China and forced to recall 1.5mn vehicles due to potentially faulty brake systems developed by Continental.
But its broader strategy has mostly paid off at a time when its German rivals Volkswagen and Mercedes-Benz have struggled to adjust to slowing demand for EVs despite their earlier ambitions to go all-electric.
While international peers including Toyota and Stellantis have also taken a multi-energy approach, BMW has stood apart for its strong offering of EVs with the same design and appearance as their petrol and hybrid counterparts.
The group’s sales of fully electric cars rose 13.5 per cent last year to 426,594 vehicles, accounting for 17 per cent of total sales. Including hybrids, the electrified proportion was 24 per cent.
“We anticipated that people wouldn’t want to be discriminated against because of the power train,” Goller said. “We’ve gone the path which others are now following.”
Analysts say BMW is better positioned than rivals to meet the EU’s tougher emissions targets without selling EVs at deep discounts. It is also less exposed to Trump’s tariff war since 65 per cent of its cars sold in the US are built locally, and it is also a net exporter from the US.
“From an operational standpoint, I think BMW, outside China, is very well placed,” said UBS analyst Patrick Hummel. “They’re pretty much where they need to be in terms of the EV share in the mix.”
Jefferies analyst Philippe Houchois has described BMW, which has in the past drawn criticism from investors for hedging its bets on power train technology, as “the most thoughtful [original equipment manufacturer] over the years”.
This year, the group will launch its Neue Klasse platform for its next generation of EVs with longer range, faster charging and upgraded software capabilities, which Houchois said would “consolidate a lead in software-defined vehicles, multi-energy power train and battery sourcing”.
But China has proved challenging to the Munich-based carmaker. BMW and Mini sales in the world’s largest automotive market fell more than 13 per cent last year to 714,530 cars, a more severe slump than rivals such as Mercedes-Benz and Audi.
Analysts at Citigroup have warned that BMW remains vulnerable to China, where intensifying price pressure in an overcrowded market has been forcing carmakers to discount prices. Sliding sales in the country, where BMW still delivers just under a third of its cars, “remains our key concern”, the Citi analysts said.
Goller acknowledged China was unlikely to return to the explosive economic growth that first attracted foreign carmakers to flood into the country.
“But we still see a growing market . . . and therefore, our ambition is clearly that we want to participate in a growing market,” he said.
Goller added that it shouldn’t come as “a shock” that Chinese brands were rapidly taking domestic market share from foreign carmakers.
“The cars are really good from a technology perspective,” he said. “But we are not afraid.”
