BMW CEO claims 'Neue Klasse' just as lucrative as existing electric vehicles

Home > Industry Analysis > Content

【Summary】BMW CEO Oliver Zipse announced that the upcoming "Neue Klasse" electric vehicle range will be as profitable as their current EVs. The Neue Klasse, set to be launched in 2025, is a crucial part of BMW's strategy to compete with Tesla. Zipse also confirmed that BMW aims to stay within their long-term profit margins of 8-10% but may exceed that range in some quarters. The company plans to release six models within 24 months of the Neue Klasse's launch, all powered by electric engines.

FutureCar Staff Sep 02, 2023 10:07 AM PT

BMW CEO claims 'Neue Klasse' just as lucrative as existing electric vehicles

BMW's Chief Executive, Oliver Zipse, announced at the IAA car show in Munich that the upcoming "Neue Klasse" electric vehicle (EV) range will be just as profitable as BMW's current battery-powered cars. The Neue Klasse, set to be launched in 2025, is a crucial part of BMW's strategy to compete with EV pioneer Tesla. Zipse stated that BMW is already highly profitable with electric cars and expects the Neue Klasse to be equally successful.

Zipse also emphasized that BMW will maintain its long-term profit target of 8-10% in its automotive segment. However, he mentioned that in some quarters, BMW could exceed this range. Last month, BMW raised its EBIT margin outlook for its cars division to 9-10.5% for 2023, citing a strong order backlog and improved availability of premium vehicles.

The CEO revealed that BMW plans to introduce six models within 24 months of the Neue Klasse's launch, including "sports activity vehicles" and sedans. All of these models will be powered by pure electric technology. Production of the Neue Klasse will begin at BMW's factory in Debrecen, Hungary, where the company is investing €2 billion in new battery-making and assembly operations. The production will later expand to sites in Munich, China, and Mexico.

The development of the Neue Klasse aims to reduce battery pack costs by 50% and achieve 25% more range per kilowatt-hour, enhancing efficiency. BMW is determined to replicate its past successes in the EV market and establish a strong position alongside Tesla.

Overall, BMW is confident in the profitability of its electric vehicle range, with the Neue Klasse expected to contribute significantly to the company's success in the growing EV market.