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BMW CEO warns companies to not depend only on a few countries

BMW CEO Oliver Zipse says that companies must be careful about not becoming too dependent on some countries. Especially with respect to manufacturing, EV makers have been relying on some countries and it has impacted drastically. Zipse further added that there is still a market for combustion engine vehicles.

BMW CEO warns against electric-only strategy

Image credits- RTE

“When you look at the technology coming out, the EV push, we must be careful because, at the same time, you increase dependency on very few countries,” Zipse said at a roundtable in New York, highlighting that the supply of raw materials for batteries was controlled mostly by China. “If someone cannot buy an EV for some reason but needs a car, would you rather propose he continues to drive his old car forever? If you are not selling combustion engines anymore, someone else will,” said Zipse.

He has long advocated against all-out bans on combustion engine car sales in the face of rising pressure from regulators on the auto industry to curb its carbon emissions and environmental impact. Offering more fuel-efficient combustion engine cars was key both from a profit perspective and an environmental perspective, Zipse argued, pointing to gaps in charging infrastructure and the high price of electric vehicles. Companies also needed to plan for energy prices and raw materials to remain high by being more efficient in their production and stepping up recycling efforts to keep costs down, he said.

“We have a peak now, they might not stay at the peak, but they will not go back to former prices,” he said. “How much energy you need and use, and circularity, is important – for environmental reasons but even more for economic reasons.”

Combustion engine vehicles

“Combustion engine is the largest [automobile] market segment in absolute terms by far in Germany, also in Europe and worldwide. Before you simply switch off something like this within eight or ten years, you have to know what you are doing,” Zipse said in the meeting, first reported by German newspaper Automobilwoche. The meeting took place in the parliament’s CSU (Christian Social Union) group in February, a Christian-democratic and conservative political party in Germany.

BMW is actually a pioneer among European automakers in the race toward electrification. BMW created its EV division and introduced its first all-electric vehicle, the i3, in 2014. But its EV effort seems to have fizzled out since then while competitors like Volkswagen and Mercedes catch up with the launch of their own EV series.

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