BMW chief warns EU combustion engines ban is stoking price war with Chinese rivals
Zipse sees ‘imminent risk’ to European makers of cheaper cars vying against brands such as BYD
BMW’s chief executive has warned that EU plans to ban combustion engine vehicles is pushing European makers of cheaper cars into a price war with Chinese rivals that they are unlikely to win.
“The base car market segment will either vanish or will not be done by European manufacturers,” said Oliver Zipse, pointing to the growing ambitions of Chinese car brands such as BYD, which specialise in electric vehicles.
China — the world’s largest market for cars — has in the past 15 years built up an electric vehicle industry that has cornered much of the world’s battery supply chains and is now, among increasingly fierce competition at home, trying to enter the European market.
“I want to send a message: I see that as an imminent risk,” Zipse said, adding that premium carmakers such as BMW were better insulated against competition from Chinese manufacturers — most of which target buyers of cheaper vehicles.
The EU’s plans to phase out combustion engine vehicles by 2035 have been criticised by the region’s car industry, which indirectly employs nearly 14mn people. Concerns have ranged from the lack of access to raw materials necessary to make car batteries to the slow rollout of charging infrastructure.
Zipse also questioned whether the bloc’s deadline could be met. In a nod to a review of the EU’s e-vehicle legislation planned for 2026, he argued that European charging infrastructure was still “far behind expectations . . . there are countries where they are not developing anything at all”.
“You wouldn’t do a review if legislators were certain that everything was in order,” he added.
Zipse, who oversaw BMW’s production lines before taking over as chief executive in 2019, was speaking ahead of the annual IAA Mobility conference in Munich that is set to be attended by more Chinese companies than ever before.
“I am not worried about BMW,” he said, adding that the company had not been affected by the price wars that have been pushing down margins for many car manufacturers in China.
“There is super fierce competition below Rmb300,000 ($41,310) — most new competitors enter that market segment,” Zipse said, noting that most of BMW’s brands were priced above that. One company that has been hit by the rise of Chinese rivals is Volkswagen, whose flagship VW brand was this year dethroned as China’s best-selling car by BYD.
BMW has, under Zipse, also become a relatively lone advocate for hydrogen-powered cars as an alternative to battery-driven vehicles, and has vowed to continue selling cars with combustion engines outside of Europe.
“If you want to be a participant in the 80mn worldwide car market, you have to do all technologies, otherwise you are not participating,” Zipse said, as the company presented a prototype for its Neue Klasse electric series, which is set to hit production lines in 2025.
“Some players are doing only electric, but these players are not covering the whole market,” he said.