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BMW Wants European Union to Postpone Ban on Gas-Engine Vehicles
BMW Wants European Union to Postpone Ban on Gas-Engine Vehicles-July 2024
2024-10-17 EDT 14:59:29

  BMW CEO Oliver Zipse wants the European Union to reverse its decision to ban the sale of new gasoline vehicles as of 2035.

  Background

  At the turn of 2023, the European Union voted on strict emission regulations, including a ban on the sale of new vehicles equipped with combustion engines.

  That came at a time when the development of electric models was in full swing, and buyers were rushing to get their hands on the new models entering the market. All indications pointed to booming demand.

  Things have changed somewhat since then. In a nutshell, early adopters, those able and ready to make the transition to EVs have done so, and those that havent yet are proving more reticent to make the leap. Growth in the EV segment continues, but it is not happening at the anticipated pace. Many would-be buyers are waiting for more affordable electric models to hit the market.

  Automakers worried

  Over the 18 months or so, several automakers have expressed their increasing concern. These companies have made astronomical investments in the transition to electric. In the medium to long term, it remains inevitable no one is questioning that. Rather, it is the speed at which change must take place that that has company executives speaking up.

  One of those is BMW CEO Oliver Zipse, who expressed at the Paris Motor Show his worry about what will happen to the viability of auto manufacturers if the ban on gas engines is allowed to take effect as scheduled.

  As reported by Motor 1, Zipse highlighted Chinas position as a major supplier of batteries, which requires considerable cooperation between carmakers and battery makers, this at a time when relations between the Chinese government and Western countries are not ideal. He also spoke of the current pessimism in Europe regarding electric vehicles. Many brands are seeing declines, and several are worried.

  The reality automakers face is that if they can no longer sell gasoline models, with which they make larger profits, they wont be able to continue to invest so heavily in EV technologies and models.

  In North America, Chevrolet, Ford and others make huge profits from the sale of their pickups. Without them, one wonders if investments in electrification would have been as significant.

  Zipse explained that, in his view, A correction of the 100 percent BEV target for 2035 as part of a comprehensive CO2-reduction package would also afford European OEMs less reliance on China for batteries. To maintain the successful course, a strictly technology-agnostic path within the policy framework is essential.

  The BMW executive is not alone in worrying about the 2035 all-electric target. Even before the ink was dry on the European Unions 2023 proposal, the German government was leading an alliance of seven countries opposed to the ban. Germany and the European Union ultimately compromised with an exception for vehicles using synthetic or carbon-neutral fuels.

  And other voices have been raised. In January 2024, Porsche Chief Financial Officer Lutz Meschke said he expected the ban to be delayed or ended outright. BMW and Volkswagen have continued to develop new combustion engines, as have many other manufacturers.

  In Italy, the Minister for the Environment and Energy Security, Gilberto Pichetto Fratin, recently said that the ban must be modified.

  Theres no pan-industry consensus, however. Volvo, fully committed to the electrification of its model range, remains fully in favour of the 2035 ban.

  Its worth repeating that automakers are not backing down on plans to go electric. BMW itself is preparing to launch the first vehicles in the Neue Klasse, a series of new-generation electric models.

  Cohabitation

  Its becoming ever clearer that the world can expect a longer cohabitation between all-electric and ICE (internal combustion engine) models.

  Things could change quickly, of course. The day electric models become cheaper and ranges start to hit 1000 km or more, theres no doubt many, many new consumers will start choosing an electric model for their next purchase. Consumers think of their wallets first, which is perfectly understandable.

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