BMW (BMWG.DE) said on Wednesday that it will invest 650 million euros ($711 million) to convert its main plant in Munich to build only electric vehicles starting at the end of 2027. This is a significant step towards the shift to an electric vehicle.
It is constructing four facilities, including a body shop and assembly line for new cars. It has relocated 1,200 workers formerly employed in conventional engine manufacture to Austria and Great Britain.
In contrast to other automakers, BMW has not set a deadline for stopping the manufacturing of combustion engine vehicles. Instead, it is facing regulations from the European Union that, as of 2035, virtually forbid the sale of new gasoline and diesel vehicles within the EU.
In 2023, the Munich-based automaker’s sales included 15% of all-electric vehicles; by 2026, it hopes to have increased that percentage to a third.
Manufacturers ranging from Mercedes-Benz to Volkswagen have issued warnings recently about the slow pace of electric vehicle (EV) sales, citing consumer economic constraints and the release of supply chain bottlenecks that have slowed manufacturing.
In September last year, BMW debuted its “Neue Klasse” preview at the IAA auto show. This was the company’s multibillion-euro attempt to outpace rivals like Tesla and other EV manufacturers in terms of technology.
The vehicle will be produced at the Munich facility starting in 2026, in tandem with combustion engine vehicles. It will be about the size of the automaker’s already famous 3-series model line.
It will also be manufactured in Shenyang, China; San Luis Potosi, Mexico; and BMW’s new facility, now under development in Debrecen, Hungary.
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