BMW AG

Low-carbon vehicle share

BMW is systematically providing electric options for all of its passenger vehicle brands and model series. It is also adopting a flexible, modular vehicle production framework to produce both internal combustion engine and electric versions of all vehicles on the same production lines. The company’s share of sales from low-carbon vehicles has increased from less than 0.1 percent in 2013 to nearly 6 percent in 2018. While this current level and speed of change aligns with that set for the low-carbon pathway, BMW will need to increase its efforts to remain on track over the long term.

BMW’s consumer engagement focuses on promoting design, autonomous driving, connectivity, and services, with electrification playing a major role in the company’s preparedness for a low-carbon economy. BMW is speeding up the pace of e-mobility expansion and plans to rapidly increase its sales of electric vehicles. Electric versions of all of BMW’s passenger vehicles are in the pipeline under a “One Platform Serves All” manufacturing strategy, and models are being released ahead of schedule.

BMW’s business model focuses on “sustainable individual mobility” in the premium segment – combined with attractive mobility services. The company has several initiatives and programmes which  reduce the structural barriers facing low-carbon vehicles when entering the market, as well as contribute to decarbonising personal mobility. However, no details regarding the size and growth potential of these initiatives, nor evidence of modal transport shifsts, were found. BMW could better demonstrate how it is positioning itself to remain profitable in a low-carbon economy through business activities outside personal vehicle ownership.

BMW’s current fleet emissions target – a 25 percent reduction from 2008 to 2020 – is less ambitious than that set for the low-carbon pathway. With just one short-term fleet emissions reduction target, BMW currently lacks milestones to ensure that it remains on track in the medium and long term. BMW should improve its target setting approach, particularly around cutting its fleet emissions, when planning for its low-carbon transition.

BMW commits to net zero manufacturing emissions by 2050. It also aims to cut a quarter of its fleet emissions by 2020, as compared to its 2008 levels. To achieve this target, BMW plans to have half a million electric vehicles, including plug-in hybrids, on the road by the end of 2019. It is also committed to offering 25 electrified passenger vehicle models by 2023, with more than half of these being fully electric. By 2025, BMW states that between 15 and 25 percent of its newly sold vehicles will be electric vehicles.

BMW is applying a flexible, modular vehicle production framework to produce both internal combustion engine and electric versions of all vehicle models on the same production lines. It has partnerships and joint technology consortiums in place to secure its battery supply, together with in-house manufacturing of electric powertrains and batteries, and is engaging with policy makers for harmonised e-mobility framework conditions to encourage consumers’ acceptance of electric vehicles. BMW is also working on projects to support low-carbon infrastructure.

BMW’s targets for reducing manufacturing emissions are well aligned to those set for the low-carbon pathway. However, the company’s fleet emissions reduction targets could be more ambitious. Available data suggests that BMW may not be sufficiently prioritising research and development expenditure on non-mature mitigation technologies over internal combustion engine drivetrains.

BMW has achieved significant fleet emissions reductions, but the company’s reputation is still withstanding backlash from its involvement in the 2015 diesel emissions scandal. BMW is also involved in an ongoing European Commission investigation, along with other German auto manufacturers, in regard to alleged efforts to restrict competition in the development and rollout of emission reduction technologies.

BMW could further embed climate change mitigation efforts into its low-carbon transition plan by strengthening its emissions reduction targets and adding measurable, time-bound indicators and milestones. BMW publicly acknowledges the challenges ahead in order to achieve existing European decarbonisation standards for the automotive industry by 2020 and beyond. However, the company’s seems to be more focused on remaining compliant with emissions regulations than on proactively driving the low-carbon transition.