Latest news with #OliverZipse
Miami Herald
13 hours ago
- Automotive
- Miami Herald
German Automakers Discussing U.S. Tariff Deal, What You Need to Know
Volkswagen, Mercedes-Benz, and BMW are leading talks with Washington over a tariff deal involving German automakers receiving credits for vehicles they export from America to other countries, which would lower or offset the tariffs on cars they import into the U.S. from Germany. America is the European Union's (EU) fifth-largest vehicle export destination after China, Japan, Britain, and Turkey, according to Reuters, but the U.S. is the largest export destination for German cars. Mercedes-Benz is expanding its U.S. production by manufacturing its GLC SUV at its Alabama plant starting in 2027, BMW is considering adding shifts at its Spartanburg plant in South Carolina, and Volkswagen's Audi mulls over producing some vehicles in the U.S.-a plan predating the Trump administration. Germany's leading automakers are aiming for talks with the U.S. Department of Commerce to result in a tariff deal in June. The potential new and current investments that the Commerce Department is reviewing from German automakers are worth billions of dollars. BMW CEO Oliver Zipse said that the manufacturer's Spartanburg plant supports 43,000 jobs and contributes over $26 billion yearly. While many European automakers withdrew their 2025 financial forecasts, BMW is backing its March projections alongside Ferrari, which also stood by its 2025 earnings forecast. However, BMW's decision to stick with its 2025 guidance is partially based on the idea that some tariffs will go into reverse from July at the latest. BMW finance chief Walter Mertl said: "We are noticing that things are moving, developing, and being negotiated everywhere. Accordingly, our reading, based on all the networks that we have at our disposal, is that we assume that something will change in July," Just Auto reports. The German automaker's 2025 outlook includes earnings on par with 2024 and an operating margin in the car segment of 5-7%, according to Reuters. The head of Germany's auto lobby, Hildegard Müller, highlighted in an interview with Politico that Germany produces about 840,000 vehicles annually within the U.S. for both the American market and exports, with 140,000 total employees. In addition to BMW's Spartanburg plant, Mercedes-Benz's Tuscaloosa, Alabama factory has been operating since 1997, resulting in approximately four million vehicles produced. Volkswagen's Chattanooga plant, which opened in 2011, built 175,000 cars in 2023. Müller also pointed out that building a U.S. automotive plant, even if you're quick, takes one or two years, and companies are losing money fast. U.S. tariffs are causing manufacturers like BMW to lose $11.3 million daily and impacting about €67 billion ($76 billion) of EU automotive exports, Euronews reports. Automakers like Volkswagen, BMW, and Mercedes-Benz are pushing for a U.S. tariff deal with the selling point that German automakers receive credits based on the number of vehicles Germany produces in America to reduce the two countries' car market trade deficit. However, if the tariffs stay in place, powerful voices in the automotive industry, like Hildegard Müller, noted that these policies can lower the pressure that U.S. car manufacturers face to be innovative, weakening their international competitiveness in the medium term. Copyright 2025 The Arena Group, Inc. All Rights Reserved.
Yahoo
6 days ago
- Automotive
- Yahoo
Home-grown Chinese Carmakers Edge Past Luxury Brands BMW, Mercedes
European luxury carmakers are shrinking in China's rearview mirror as shifting dynamics in the world's largest auto market threaten to leave them behind. Case in point — a little-known, home-grown carmaker in China called Seres Group lapped BMW and Mercedes in car sales last year, enticing domestic customers with souped-up cockpits developed in partnership with the country's telecom giant Huawei Technologies. This story was originally published on The Daily Upside. To receive delivering razor sharp analysis and perspective on all things finance, economics, and markets, subscribe to our free The Daily Upside newsletter. Seres Group's status as a luxury contender was cemented with its electric-vehicle brand AITO. Deliveries of its M9 SUV in 2024 totaled 151,000, surpassing BMW and Mercedes in the 500,000 yuan-and-up category (~$69,000), per a Bloomberg article citing data from Shanghai-based auto consultant ThinkerCar. AITO, an acronym for 'Adding Intelligence to Auto,' is something of a bellwether for shifting consumer preferences in China, where electrification and 'smartification' are in the driver's seat, according to McKinsey's 2024 China Auto Consumer Insights report. Its models feature luxury appointments, including roomy interiors and intelligent driving assistance, but come at affordable prices and with a domestic brand name. Stealth wealth has become more culturally palatable given China's macroeconomic challenges lately and President Xi Jinping's distaste for flashing cash. Legacy luxury automakers have acknowledged the environment while catering to customers there: 'In all major sales regions outside of China, we increased our sales compared to the same period of last year,' Oliver Zipse, chief of BMW, said in an earnings call in early May. 'Thanks to our strong performance in other markets, we were able to nearly offset the persistent challenges in the Chinese market.' Ola Källenius, chief of Mercedes-Benz, said the company is 'ever strengthening its commitment to China' in a presentation in Shanghai late last month of the Vision V, a luxury van he called a 'private lounge on wheels.' The German carmaker's first-quarter sales declined slightly year-over-year, primarily due to weakness in China. Per ThinkerCar data, BMW and Mercedes vehicle deliveries picked up in January and February this year, overtaking AITO. EV Traction. China's carmaking prowess, particularly in EVs, also shows up in other places, like Europe. BYD, the Chinese EV giant that has enticed investment from Warren Buffett, sold more of its cars in Europe than Tesla for the first time last month, according to London-based auto intelligence firm Jato Dynamics. However, BYD has hit roadblocks at home: Its shares plunged 8% on Monday as markets reacted to price cuts designed to clear inventory amid waning demand. Fears of a potential price war also dragged down other Chinese automakers, spurring slides of more than 5% for Li Auto, Great Wall Motor, and Geelo. The post Home-grown Chinese Carmakers Edge Past Luxury Brands BMW, Mercedes appeared first on The Daily Upside. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Time of India
16-05-2025
- Automotive
- Time of India
BMW CEO tells how the company was right on 'Tesla trend', unlike Mercedes, Volkswagen, and Volvo
BMW CEO Oliver Zipse declared victory over rivals in the electric vehicle market strategy , claiming his company's cautious approach has been validated as competitors scale back ambitious EV targets. "We took a clear stand on this, even in the face of strong headwinds. Now the wind has shifted in our direction," Zipse told shareholders on Wednesday. While competitors like Mercedes-Benz, Volkswagen, and Volvo made aggressive commitments to all-electric lineups five years ago, BMW maintained its strategy of offering multiple drivetrain options including combustion engines, hybrids, and electric vehicles. "E-mobility as the sole technology leads to a dead end. That should be obvious by now," Zipse stated, doubling down on BMW's technological flexibility. Legacy automakers have struggled with EV adoption Traditional automakers have faced challenges convincing their established customer base to embrace electric vehicles. Companies including Mercedes and Volvo have recently walked back their earlier EV sales targets as market growth proves slower than anticipated. Even Tesla, the industry's EV pioneer, hasn't been immune to the slowdown. The company experienced its first annual sales decline since the Model Y launch and continued struggling through the first quarter of this year. BMW says it stays flexible while expanding EV offerings Despite advocating for technology openness, BMW isn't avoiding the EV market. The company reported 14% growth in electric vehicle sales last year, with over 426,500 vehicles sold across its BMW, Mini, and Rolls-Royce brands. "Technology openness means following the markets, because markets evolve, but not all at the same pace," Zipse explained. BMW is also preparing to launch the iX3 mid-size electric crossover by year-end, built on its new dedicated EV platform called "Neue Klasse." The company further plans to introduce hydrogen fuel-cell powered vehicles in 2028, maintaining its multi-technology approach in an increasingly uncertain automotive landscape. AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Yahoo
15-05-2025
- Automotive
- Yahoo
Betting all your chips on EVs is a ‘dead end,' BMW tells shareholders: ‘That should be obvious by now'
BMW's chief executive Oliver Zipse felt his company's reluctance to jump on the EV bandwagon has been vindicated even as he prepares to launch his first of several models underpinned by an platform built from the ground up for EVs. 'We took a clear stand on this, even in the face of strong headwinds. Now the wind has shifted in our direction,' he said. Market research firm Gartner dubbed it the 'trough of disillusionment': the stage when a buzzy new technology first fails to live up to its hype. One of the earliest to predict electric vehicles would suffer its own growing pains has been BMW. For years, executives at the German premium carmaker have been warning car buyers would not make the switch as quickly as anticipated, despite all the excitement around Tesla. Now, it's told shareholders it would stand by its commitment to offer customers a wide range of drivetrain options including combustion engine, hybrid, and even hydrogen fuel-cell powered cars, with the latter debuting in 2028. 'Technology openness means following the markets, because markets evolve, but not all a the same pace,' said CEO Oliver Zipse at BMW's annual meeting on Wednesday. 'E-mobility as the sole technology leads to a dead end. That should be obvious by now.' Some five years ago, a number of brands including Mercedes-Benz, Volkswagen, and Volvo proclaimed ambitious targets for how soon they would switch to EVs. By comparison, BMW's reluctance to jump on the EV bandwagon saw rivals like VW's ex-CEO Herbert Diess criticize the company for slowing down progress. 'We took a clear stand on this, even in the face of strong headwinds. Now the wind has shifted in our direction,' Zipse continued. BMW turned bearish on EVs after the company was burned by the i3, a small EV for inner-city driving that launched in 2013. Featuring a lightweight but expensive carbon-fibre body, it was supposed to be a trend setter, but ended up a financial failure in the eyes of analysts and investors. At the start of the decade, this EV evangelizing seemed to make sense as Tesla was all the rage and CEO Elon Musk struggled to keep up with demand. In 2020, Tesla eclipsed all automotive peers to become the most valuable carmaker in the world despite selling only half a million vehicles that year. BMW's rivals had already poured billions into the development of dedicated architectures capable of economically building a wide variety of EVs in all shapes and sizes—such as the EVA2 at Mercedes-Benz and Volkswagen's vaunted MEB platform. The results have been sobering. Legacy brands have had a difficult time explaining the advantages of the technology to their skeptical customers. Carmakers have complained there are still plenty of popular myths around EVs that need to be debunked, including whether owners might be electrocuted while charging in the rain. By comparison, Tesla could cater to a predominantly progressive audience eager to be the first to test out the latest that technology had to offer, and were well-versed about the various pros and cons. Now, many of these same legacy companies such as Mercedes and Volvo have been walking back their more ambitious EV sales targets. The slower-than-expected uptake in EVs hasn't left Tesla untouched either. Last year, it buried its own 2030 sales target, suffered its first annual sales decline since the Model Y launched, and saw its slump continue into the first quarter. For one, the Chinese EV market, which is the world's largest, is increasingly shutting out western brands that had expected to transfer their market share in the traditional combustion-engine market to the EV market. Even Tesla dropped to eighth place last month, from third in 2024. Other countries like the United States are flat-out no longer willing to finance the purchase of a more expensive EV with a $7,500 per car federal tax subsidy. Europe also has experienced disparate levels of interest. While few new cars sold in oil-rich Norway still require gasoline or diesel, in the euro area's third-largest economy, Italy, the EV share of the new-car market languished at just 4% last year. 'The differences are too severe, even within Europe,' Zipse said, whose company's own global EV sales grew by 14% to over 426,500 vehicles across the BMW, Mini, and Rolls-Royce brands. Nevertheless, even the Munich carmaker has dropped its opposition to dedicated EV platforms. The BMW iX3 mid-size electric crossover, scheduled to go into production at the end of this year in Hungary, is based on the Neue Klasse, an all-new and EV-only architecture. This story was originally featured on
Yahoo
07-05-2025
- Automotive
- Yahoo
BMW boss predicts Trump's 25% tariffs on foreign cars will be lowered by July
BMW CEO Oliver Zipse also said he expected a return to lower tariffs between the US, Canada and Mexico because the 'costs are far too big for everybody'. Photograph: Héctor Retamal/AFP/Getty Images The boss of BMW has predicted that Donald Trump's tariffs on imports of foreign cars will be lowered this summer, as the German carmaker reported that its profits for the first quarter tumbled by 25%. Oliver Zipse, BMW's chief executive, said that he expects Trump's 25% tariffs on the import of foreign cars will be dropped by July. He made the prediction after the German carmaker reported a 25% drop in profit for the first quarter of the year to €3.1bn (£2.6bn) as it braced for the effects of Donald Trump's trade war and strong competition in China. Zipse also said he expected a return to lower tariffs between the US, Canada and Mexico – previously a free-trade zone under a deal he signed – because the 'costs are far too big for everybody'. 'In trade conflicts, nobody wins. All sides should avoid a spiral of isolation and trade barriers,' Zipse said. He called for 'zero-zero' tariffs deals amid 'challenging' trading conditions for car manufacturers. In March, the carmaker said that tariffs imposed by the US, EU and China could cost it €1bn this year. EU tariffs on Chinese electric car imports in response to alleged state aid from Beijing cost BMW more than €100m in the first quarter of 2025, it said on Wednesday. Trump's 90-day 'pause' on tariffs above a flat rate of 10% on most countries is due to end in early July, with the threat of a return to much higher levies, alongside the 145% duties still in force on China. However, the US is rushing through a series of what it describes as trade deals with major trading partners which could lower tariffs. BMW insisted that it is nevertheless well placed to endure extra tariff costs, with separate factories in the US and China. Zipse said BMW has experienced 'hardly any effect' from the steep US tariffs on China and China's retaliation. Zipse said that its factory in Spartanburg, South Carolina, makes BMW the largest automotive exporter from the US by value. He added that the company's arguments against tariffs were being listened to. BMW also owns the Mini factory in Oxford, where the company last month cut 180 contract workers in response to lower demand. Despite the first quarter earnings slump, BMW stuck with its guidance for profits for the year in line with 2024. It said that it expected an improvement in the global tariff situation as countries scramble to secure trade deals with the US, and insisted that it was experiencing continued strong demand for its battery electric vehicles, with sales up 32% year-on-year, despite stiff competition in China. In the first months of the year, BMW's sales in China, the Munich-based manufacturer's biggest individual market, fell 17% during the period even as sales in Europe and the US rose by 6% and 4% respectively.
