German automaker BMW is ramping up electric vehicle production in China to catch up with frontrunners Tesla and domestic rivals such as BYD. The new plant in Shenyang is BMW’s third factory in China and will bring the country’s annual production capacity to 830,000 cars.
Anadolu Agency | Getty Images
BMW has officially opened its new 15 billion yuan ($2.2 billion) factory in China with a strong focus on electric vehicles as it tries to catch up with frontrunners Tesla and domestic competitors.
The Lydia plant in the northeastern city of Shenyang is BMW’s third plant in China, but the largest investment in the country.
The plant’s capacity can only be used to make electric vehicles and traditional combustion engines.
BMW’s i3, BMW’s first all-electric mid-size sports sedan for the Chinese market, began production at Plant Lydia in May.
“The expansion of our manufacturing footprint in China shows that we are preparing for further growth in the world’s largest electric vehicle market and are confident in China’s long-term prospects,” said Jochen Goller, president and CEO of BMW Group in China. a press. release on Thursday.
“We are stepping up our e-mobility efforts and aim to have more than a quarter of our sales in China be fully electric by 2025.”
But BMW still has some catching up to do in China, the world’s largest electric vehicle market, where US rival Tesla and domestic players like Warren Buffett-backed BYD dominate sales.
Foreign traditional car manufacturers, including BMW and Volkswagen, have been left behind. But they are ramping up production now. BMW’s newest plant brings the German automaker’s annual production capacity in China to 830,000 cars.
Ralf Brandstaetter, CEO of Volkswagen Passenger Cars, told the Nikkei in February that the automaker could build as many as 1 million electric vehicles per year in China by 2023.
Still, carmakers in China, already struggling with global supply chain problems, have faced further challenges in the world’s second-largest economy after a resurgence of Covid-19 in recent months led to closures of major cities, including especially Shanghai.
This has led to further supply disruptions. In an interview published Wednesday, Tesla chief executive Elon Musk said the tools needed for the company’s Austin and Berlin plants are stuck in China. He added that the two plants are “losing billions of dollars right now” as supply chain problems hamper production.