And yet it'll probably work beautifully.
Switching over to electric vehicles after nearly a century of designing, engineering, and manufacturing combustion vehicles is a huge challenge, to say the least. While EVs are not about to overtake conventionally powered cars, trucks, and SUVs just yet (they only currently account for around 5 percent of the market), automakers know what's coming as governments continue to crack down on emissions. Zero emissions are the future and automakers very much want to remain in business.
Unfortunately for BMW, it has fallen behind its major rivals, specifically the Volkswagen Group and Mercedes-Benz, with EV development but it has a new plan to change that. In the meantime, finding a way to fund this shift to EVs is essential and Bloomberg reports BMW has found a key way to do this. According to the report, BMW wants to more than double sales of the X7 SUV to help counter lower profits and, equally important, to help fund the shift to EVs.
The large and thirsty X7 won't be alone in this sales blitz as it'll be joined by the 7 Series sedan and 8 Series lineup, such as the M8, and the i8 plug-in hybrid. BMW Chief Financial Officer Nicolas Peter said late last week the plan is to sell between 135,000 and 145,000 of these specific models next year. This is a significant jump from last year's figure of 65,000 combined sales of these models, though with one major exception: the X7, which only recently went on sale. "The important topic for us is how do we get our profitability up," Peter said. Of course, an increase in gas guzzlers, such as the X7, kind of defeats the purpose of EVs. But, again, money doesn't grow on trees. "This is a worldwide growing segment," Peter added in reference to increased EV demand.
Meanwhile, BMW is currently cutting costs by $14 billion specifically in order to fund more EVs. The next BMW EV, the iX3, is due next year, followed by the i4 and iNext crossover.
BMW's profits dropped in the second quarter of this year due to factory retooling expenses for EVs and global economic slowdown in general. But what remains popular, at least for now, are luxury SUVs, big luxury sedans (mainly in China), and luxury grand tourers with up to 617 horsepower. Building and selling more gas guzzlers in order to help fund future zero-emission vehicles is, for lack of a better word, ironic.