BMW is claiming the European “tipping point” between battery-electric vehicles and those using internal-combustion engines has passed.
Yet, the German automaker announces its overall sales of vehicles in 2023 were made up of just 15% BEVs. While the European Union's 2030 target for automakers is that 80% of vehicle sales be emission-free, the U.K currently has stiff penalties against automakers that do not achieve at least 22% of overall vehicle sales as emission-free vehicles by the end of this year. The fines would amount to £15,000 ($19,100) for every vehicle sold that misses the target.
Despite this, in a media roundtable interview reported by Reuters, the automaker’s chief financial officer, Walter Merti, insists BEVs now generate its most sales growth. He adds: “The tipping point for the combustion engine is already there. The current sales plateau for combustion cars will continue and then fall slightly.”
He referred to the EU’s plans to ban all sales of fossil-fueled vehicles by 2035 without mentioning the loophole for ICE technology that will allow sales of new vehicles using carbon-neutral fuels such as e-fuels.
Nonetheless, BMW hopes 33% of its overall sales will be BEVs by 2026 as it rolls out six new models in its "Neue Klasse" BEV-only line. That goal suggests the automaker could be contemplating seriously cutting sticker prices to persuade car buyers to purchase BEVs in the teeth of a Europe-wide cost-of-living crisis, something Merti acknowledges as a possibility.
The plans also will squeeze near-term profitability, with BMW admitting it will not see its profit margins for BEVs match those of its ICE products until at least 2026, largely owing to the extra costs of battery packs.
