BMW Sees U.S., China Leading EV Sales

NEW YORK – The U.S. will be the top electric-vehicle market for now, but China eventually will challenge for sales leadership, BMW global marketing chief Peter Schwarzenbauer predicts.

“I would guess more EVs will be sold in the U.S. than in Europe,” Schwarzenbauer says here during the recent media launch of the auto maker’s new i3 EV.

“In the next few years, the U.S. will lead in EV sales, but in the long term I see the U.S. and China (vying) for EV leadership,” he adds. “In China, it depends on how quick the government can provide an infrastructure for EVs.”

Consumers rarely are eager to pay more for new technology, admits Schwarzenbauer, who as marketing head has primary responsibility for making the coming generation of BMW’s electrified vehicles profitable. “But they are more open to EVs when you explain the concepts to them.”

BMW i3 buyers will pay a premium over an equivalent conventionally powered car, “but they will break even after 30,000 miles (48,000 km),” he predicts.

However, with tax breaks, particularly in California, where state and federal tax credits total $10,000, i3 buyers would pay less than for a BMW 328, the closest conventionally powered car to the i3 in the auto maker’s portfolio.

“We're going to attempt to attract a new customer base for the i3,” Schwarzenbauer says. “The target group will be completely new, but it's too early to tell how many there will be.”

About 90,000 potential buyers have registered globally to test-drive the i3. Some 60% of i3 customers are expected to be new to the BMW brand. “That's a brave guess,” Schwarzenbauer admits.

Fuel economy is getting to be a huge factor in why buyers choose a particular vehicle, the BMW executive says. “It's a new performance paradigm.”

Overall he forecasts the premium market to grow at a stronger pace than other car segments, sparked mostly by demand in Asia and the U.S. Sales of premium-luxury cars will increase 7%-8% this year, Schwarzenbauer predicts.

Ludwig Willisch, president and CEO of BMW of North America, admits EV sales have been sluggish in the U.S. But he forecasts combined industry EV and hybrid deliveries will reach 850,000 units annually by 2018.

BMW Chief Operating Officer Peter Miles dismisses any notion EVs will constitute only a small part of the automotive market in the next decade. “It's the beginning of (EV) growth, not the end,” he says.

However, a lot of capital investment from all sectors, including state and city governments, will be needed to boost demand, Miles says.

BMW plans to stimulate EV sales by persuading its retailers to buy and install solar-powered battery-recharging stations, which Miles believes ultimately will be a source of revenue.

“Our aim is to produce a sustainable business from this,” he says.

Willisch says BMW’s biggest dealers “are really excited about the introduction of the i3, and they already want more (than we promised to supply).”

He believes the i3 will sell close to its suggested retail price of $41,350, because few options are offered. “The car is pretty fully equipped,” Willisch says, adding he expects more than half of i3 buyers will purchase the optional range-extending gasoline engine.

BMW will have a “fantastic” 2013, the CEO says, with growth opportunities in trucks and with the new 4-Series coupe. “It might even be a record for us.”

BMW’s U.S. sales peaked at 293,795 units in 2007.