Tesla may only be a newcomer to the automotive world, but its influence is already enormous. In addition to its electric vehicles, it is above all its way of working and its power in terms of services and software that has changed the way a vehicle is designed (and used). Traditional car manufacturers have now understood this and have started their revolution. At this little game, BMW certainly seems to be the best equipped for the future.
The automotive world in 2019 has little in common with the world of the 1980s, as it will certainly have little to do with the world of 2050. One thing is certain: adaptation is survival. But there is no point in denying your roots, otherwise you risk destabilizing your customers. BMW has been experimenting with this for several years. The Bavarian manufacturer, known for its driving pleasure, has understood the new challenges facing the automotive industry and the world leader in the premium segment in 2018 must make a successful transition or risk losing its status.
Electrification across the board
The first sign is the diversification and electrification of its range. Driven by the dieselgate scandal, encouraged by the public authorities, constrained by the challenges of future mobility and climate change, BMW has little choice. A pioneer in electric cars with the launch of the BMW i3 in 2013, the manufacturer has completely lost its lead. Worse still, in the premium segment where it has been the leader until now, competition is becoming increasingly fierce, with Tesla in the lead. This situation probably explains the appointment of Oliver Zipse to replace Harald Krüger as head of the group.
BMW plans to offer 25 electric vehicles in its portfolio, including 12 electric and 13 plug-in hybrids. However, the manufacturer is not rushing to the conclusion that the market is not necessarily ready. In view of the current sales figures for electric cars in Europe, the manufacturer can only be proved right.
Gradually, the range of electrified BMWs is being built. BMW is drastically reducing its costs by €12 billion by 2022 but is investing heavily in the development of flexible platforms (electric and thermal) for its cars, so the new electric Mini was launched at the IAA. The small city car has a 32.6 kWh lithium-ion battery for a range of 230 kilometres. The iX3 will follow next year and then it will be the iNext and the i4, and so on.
BMW has also confirmed its willingness to invest in hydrogen technology, unveiling a prototype based on the X5 in Frankfurt. In total, the brand plans to sell more than one million electrified vehicles in 2021.
The digitization of the brand continues
The second sign of the brand's change could also be seen in person at the IAA 2019 Motor Show, although the manufacturer was still present in Frankfurt in its native country, its stand had clearly decreased in size compared to previous editions. The Munich firm is now allocating its budget differently and investing more in digital technology. The brand now focuses on high-tech shows, such as CES in Las Vegas and MWC in Barcelona. This choice is not surprising in the end, given the change in consumer behavior and the importance of digital technology.
As a result, more connected services are available in cars but also outside with more complete applications. Voice assistants are becoming more important and the approach of the Munich teams is increasingly similar to that of the digital tech giants and Tesla. Motorists are evolving and expect more technology in their vehicles. No matter how they drive (sharing services, rentals, purchases, etc.), they expect services and ease of use equivalent to that of their smartphones. It is therefore necessary to have an important software update and monitoring policy throughout the car's life cycle. Tesla is the example to follow in this regard.
BMW also develops everything internally to facilitate this, and unlike some of its competitors, avoids buying small start-ups. Combining two technologies can sometimes complicate things and slow things down.
Taking on the digital giants
Last but not least, the manufacturer wants to compete with the technology giants. Google, Samsung, Intel, Qualcomm (and more) are spending money on the car of tomorrow. The autonomous car is at the heart of this race and BMW wants to avoid becoming a simple equipment manufacturer in the future. Alejandro Vukotich, Senior Vice President Fully Automated Driving and Driver Assistance at BMW, is well aware of this and promises an autonomous level 3 car in 2021. The man is confident about the success of the group and the role of the brand in changing the future of mobility.
How do you see the automobile industry in the coming years? Let us know.