Copyright FOURIN, Inc. 2022
BMW Expands New-energy Vehicle Sales and Infrastructure in China
In 2019, BMW’s automobile production in China increased 9.1% year-on-year to 536,000 units. In the first half of 2020, production went up 3.5% to 254,000, maintaining growth despite the spread of the new coronavirus. Sales revenue in 2019 reached 20.6 billion EUR, surpassing the 20 billion EUR mark for the first time. Sales in China accounted for around 19.7% of BMW’s combined sales around the world. BMW is accelerating its electrification strategy by launching new products in the Chinese market, while also strengthening alliances with other companies.
Brilliance BMW is stepping up the introduction of electric vehicle products. Pre-order sales of the BEV version of the iX3 began in September 2020 and it is scheduled to be launched at the end of the year. It will be the first mass-produced model equipped with BMW’s 5th generation electric powertrain the eDrive. The model is equipped with CATL’s battery cells and has a NEDC driving range of 500km. In September 2020, Brilliance BMW’s drive battery center went into operation, coinciding with the introduction of the iX3. It manufactures battery modules and packs for the iX3.
BMW: Business Strategy and Recent Developments in China (As of September 2020)
|Electric vehicle launch and sales plans||・In March 2020, BMW set a goal of launching 25 electric vehicle models by 2023, of which over half are planned to be BEV models. ・In August 2020, BMW announced a plan to sell more than 7 million electric vehicles (BEVs and PHEVs) in the global market including China by 2030. – According to BMW, about two-thirds (about 4.7 million units) of the 7 million units will be BEVs. – BMW also revealed that, BMW and MINI brand electric vehicles are sold in 74 countries and regions around the world, and the cumulative number of electric vehicles sold by 2019 has exceeded 500,000 units. The cumulative number of electric vehicles sold by 2021 is aimed to reach 1 million units.|
|Results Sales volume||・In 2019, BMW’s vehicle sales in China increased 13.1% year-on-year to 724,000 units (including imported vehicles and the MINI brand), reaching an historic high. China’s share of total sales increased from 25.7% to 28.6%. – Since entering the Chinese market in 1994, cumulative sales have reached more than 4.72 million units by the end of 2019, of which cumulative sales of new-energy vehicles have exceeded 50,000 units. – In 2019, the factory shipment volume of the MINI brand in China increased 11.3% year-on-year to 33,267 units.|
|Sales revenue||・BMW’s sales revenue in China was around 20.6 billion EUR in 2019, surpassing the 20 billion EUR mark for the first time. Sales in China accounted for around 19.7% of all sales.|
|Increasing battery procurement from CATL||・In November 2019, BMW expanded its global battery procurement contract with CATL from 4 billion EUR to 7.3 billion EUR, extending the procurement period from 2020 to 2031. Of which 4.5 billion EUR worth of products are supplied to global locations and 2.8 billion EUR worth of products are supplied to BMW’s production bases in China.|
|Launching the iX3 EV||・In September 2020, Brilliance BMW unveiled the BEV version of the iX3. The automaker announced that it will start pre-order sales in China and launch the model on the market at the end of 2020. The model has been developed based on the BMW X3 and will be produced at Brilliance BMW’s plant in Shenyang city, Liaoning province. The model is planned to be sold not only in China but also in the global market. It will be the first mass-produced model equipped with BMW’s 5th generation electric powertrain the “eDrive.” – The model uses CATL’s new NCM 811 battery (80 percent nickel, 10 percent cobalt and 10 percent manganese). – The iX3 is equipped with a motor which has a maximum output of 210kW and a maximum torque of 400Nm, and a 74kWh battery. The energy density of the battery pack system is 154Wh/kg. it has a NEDC driving range of 500km. The battery can be charged 80% in 45 minutes in rapid charging mode and 100% in 7.5 hours in regular charging mode. – The model accelerates from 0 to 100km/h in 6.8 seconds. – The selling price ranges between 470,000 CNY and 510,000 CNY. – NEDC electricity consumption is 16.7kWh/100km. – Rival models are the Mercedes-Benz EQC and Audi e-tron.|
|Starting operation of local battery plant||・In September 2020, Brilliance BMW’s drive battery center (second phase) went into operation. It produces BMW’s 5th generation batteries. The center is BMW’s first production base in the world for 5th generation batteries. – It supplies battery modules and packs to the iX3.|
|Setting up Spotlight Automotive with Great Wall Motor||・In December 2019, BMW and Great Wall Motor established a 50-50 joint venture, Spotlight Automotive, in Zhangjiagang city, Jiangsu Province. The joint venture has a capital of 1.7 billion CNY. – The construction of Spotlight Automotive’s plant began in 2020 and is scheduled to be completed in 2022. Total investment will reach 5.1 billion CNY and annual production capacity is planned to be up to 160,000 units. – Spotlight Automotive will manufacture new-energy vehicles including the BEV version of the MINI Series.|
|Tie up with State Grid Electric Vehicle Service||・In June 2020, BMW and State Grid Corporation of China’s subsidiary State Grid Electric Vehicle Service, which engages in charging and battery swapping services for BEVs, concluded a strategic partnership. – According to the agreement, State Grid Electric Vehicle Service will collaborate with BMW in three main areas: charging technology research, charging services, and expansion and promotion of electric power for new-energy vehicles. – BMW announced that it will have more than 270,000 chargers in China by the end of 2020 in partnership with State Grid Electric Vehicle Service, of which 80,000 will be DC quick chargers. BMW's charging network will cover over 50,000 km of highways as State Grid Electric Vehicle Service’s highway fast-charging network will also be available for BMW owners.|
|Tie up with Tencent||・In July 2020, BMW announced that it would strengthen its digital content cooperation with Chinese IT giant Tencent. – The two companies agreed that TAI (Tencent Auto Intelligence)’s in-vehicle applications WeScenario and In-car WeChat will be installed in BMW vehicles. – BMW will utilize Tencent's technology to enhance the content of the automaker’s multimedia system.|
|Tie up with Alibaba||・In July 2020, BMW entered into a strategic partnership with Alibaba Cloud, a cloud services platform under the umbrella of e-commerce giant Alibaba. The two companies will jointly establish an innovation base in Shanghai to support Chinese startups in the Internet and automotive fields. – The alliance’s base will be established in Pudong New Area, Shanghai.|
In an effort to ensure a stable battery supply, BMW expanded its global battery procurement contract with CATL from 4 billion EUR to 7.3 billion EUR in November 2019, extending the procurement period from 2020 to 2031.
Looking at tie-ups with Chinese companies, a 50-50 joint venture Spotlight Automotive was established with Great Wall Motor in December 2019 with the aim to locally manufacture new energy vehicles, including the BEV version of the MINI Series. Simultaneously with the introduction of NEV models, BMW and State Grid Corporation of China’s subsidiary State Grid Electric Vehicle Service, which engages in charging and battery swapping services for BEVs, concluded a strategic partnership in June 2020. State Grid Electric Vehicle Service will collaborate with BMW in three main areas: charging technology research, charging services, and expansion and promotion of electric power for new-energy vehicles. In addition, BMW announced in July 2020 that it would strengthen its cooperation with Chinese IT giant Tencent. Tencent’s app will be installed in BMW’s multimedia system to improve user convenience.