BMW increased its EBIT margin outlook for the cars division in 2023

BMW's CEO, Oliver Zipse, declared during the IAA Mobility auto show in Munich that the upcoming Neue Klasse electric vehicle range will generate substantial profits, potentially surpassing the success of the automaker's current electric offerings. Scheduled for a 2025 launch, the Neue Klasse holds a central role in BMW's strategy to emulate past achievements and compete with electric vehicle pioneer Tesla, who is also making a return to the IAA this year.

Zipse emphasized the current profitability of.BMW's electric cars, stating, "We are already highly profitable with electric cars today." He further assured that the Neue Klasse, also known as the New Class, is poised to be highly lucrative, affirming that it will at least maintain current profit levels, if not exceed them.To solidify BMW's commitment to profitability, Zipse noted that the Munich-based company intends to remain within its long-term target profit margin range of 8 to 10 percent for its automotive segment.

Encrypting your link and protect the link from viruses, malware, thief, etc! Made your link safe to visit.

He even hinted that in certain quarters, BMW might surpass this margin range.In a recent development, BMW increased its EBIT margin outlook for the cars division in 2023 to a range of 9 to 10.5 percent, up from the previous forecast of 8 to 10 percent. This upward adjustment is attributed to a robust order backlog and improved availability of their premium vehicles.Regarding product plans, Zipse revealed that BMW aims to introduce six models within two years of launching the Neue Klasse. These models will span various categories, from "sports activity vehicles" to sedans, all unified by their electric powertrains.

Production of the Neue Klasse will commence at BMW's Debrecen factory in Hungary, where the company is investing 2 billion euros ($2.2 billion) in new battery production and assembly facilities specifically for this model. Subsequently, production will expand to sites in Munich, China, and Mexico.The development of the Neue Klasse is heavily focused on reducing battery pack costs by 50 percent and achieving a 25 percent increase in range per kilowatt-hour, a crucial measure of efficiency, according to BMW executives.