BMW on Tesla's EV reign: ‘That's over'

NEW YORK — Since Tesla has moved in on BMW's dominance as reigning U.S. luxury sales champ, BMW intends to move in on Tesla's dominance as U.S. electric-vehicle king.

The German marque's top executives said last week they are ready to bring out a fleet of electric vehicles, aiming to sell 200,000 of them globally this year — doubling the number it delivered last year.

The focus will be "on a very strong and fast ramp-up of electric vehicles," BMW Group sales chief Pieter Nota told journalists last week at a press event here.

Tesla "had a unique selling point for quite some time. That's over," Nota said.

For the first two months of this year, Tesla had 71,250 new-vehicle registrations in the U.S., according to data from the financial information company Experian. BMW had 54,210 registrations.

Last month, BMW fired its first salvos against Tesla with the launch of a pair of next-generation electric models in two market sweet spots.

The 300-mile BMW i4 fastback aims at Tesla's bread-and-butter Model 3.

"It's the electric product that customers expect from BMW," Nota said. "It's the ultimate electric driving machine."

The X5-size BMW iX, meanwhile, targets the much larger-selling midsize crossover segment.

Nota said the order books are already full for the iX and i4.

"Dealers have hundreds of orders for those two vehicles," Nota said. "The order time would now be around six months."

Three more BMW Group EVs are planned for the U.S. over the next two years. At a private event last week, BMW revealed to journalists an electric version of the brand's 7 Series top-of-the-line sedan.

Battery additions to the 5 Series midsize sedan and the Mini Countryman compact crossover are due in 2023.

BMW Group said it expects at least one out of every two vehicles sold to be fully electric by 2030.

"I think we will be able to hit that point even a little bit earlier," Nota said. "We are working hard together with our production colleagues to drive that ramp up."

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BMW CEO Oliver Zipse underscored Nota's optimism.

"We will push the company to the limits of production capability," Zipse said last week. "Demand will be surging. We already see that with the iX, with the i4."

As automakers bring more electric vehicles to market, the customer profile is changing.

The EV customer in the past couple of years "was very much an early adopter," Nota said. But EVs are now attractive to a much broader audience, he said.

BMW's product offensive arrives amid an industrywide pivot toward EVs. Faced with regulatory pressure from Europe and China, automakers are plowing billions of dollars into EV fleets.

But the luxury competition might not be the only threat to BMW's electric ambitions.

Supply chain crises that surfaced early last year continue to dog vehicle production.

"Our expectation is it will last well into 2022," Nota said. "We probably will see some relaxation in 2023."

Prescient planning has helped BMW navigate parts shortages better than some of its rivals. BMW was one of just three major luxury brands to post a year-over-year sales gain in the first quarter.

"We did not make the mistake of reducing [semiconductor] orders too much following COVID," Nota said.

As the shortages dragged on, BMW entered direct agreements to secure several million semiconductors a year.

The war in Eastern Europe is now further threatening global vehicle production. Last month, BMW paused production at its German and other European plants after Russia's invasion of Ukraine suspended deliveries of wire harnesses, a vital part of a vehicle's electrical systems.

In response, BMW has expanded sourcing of the key component from other Eastern European countries, North Africa and Mexico.

Even as BMW executives talk up electric vehicles, the automaker isn't willing to go all in on the emerging technology yet.

While Mercedes and Volvo broadcast their intent to switch to EV-only fleets by early next decade, BMW plans to also keep pumping out combustion engine and hybrid models.

"If you want to be resilient, you have to be flexible," Zipse said. "We think the [EV] infrastructure will not move as fast as market demand."

In Europe, the EV market is growing five times as fast as the charging infrastructure, Zipse said.

"In Europe, you have a growing EV market for all brands — all growing equally," he said. "In the United States, you have one brand which is super successful."